Dozens of Swedish songwriters signed an OpEd in Aftonbladet, a leading Swedish newspaper, complaining of low royalty payouts from streaming services compared to royalties collected by record labels, and predicted an imploding industry if a different balance is not created.
the declaration aims much of its criticism at record labels. “Record companies and other industry players in danger of sawing off the branch they sit on […] Very few songwriters will be able to afford to write songs except as a hobby.”
The open letter gives some historical perspective from the songwriter viewpoint. Spotify, a Swedish-born company, is the only music service mentioned, and the songwriting group gives credit to Spotify for launching as an antidote to piracy. At the same time, Spotify’s service discouraged CD sales also, and the letter takes labels to task for demanding so much equity and high royalty rates as an offset. That, in the songwriters’ minds, leaves an unbalanced payout scenario in which performers and labels get most of the royalty money.
This is a well-publicized argument in the U.S. music-rights arena as well, with ASCAP and BMI both complaining about low payouts to publishers and creators of music. U.S. terrestrial radio is the only platform where songwriters get a better deal, because radio is exempt from performer licensing requirements in their over-the-air programming.
The Swedish songwriters call for more transparency as a first step. Private deal-making between Spotify and record labels keep the details hidden. The songwriter group points to a CISAC study which evaluates the imbalance of payouts to labels and creators, and recommends high royalties overall in addition to leveling the scale.