Jeff Price had nothing to do with Cracker and Camper Van Beethoven frontman David Lowery's recent lawsuit against Spotify for as much as $150 million in copyright infringement damages. "I'm not trying to steal his thunder and glory," Price says. But the founder of Audiam, who works with Bob Dylan, Metallica and others to recover unpaid publishing royalties from streaming services such as Spotify, Apple Music and YouTube, has been railing about the issues raised in Lowery's class action for years. He wants the services to shell out the money.
Price, who takes a cut whenever artists such as Dylan or Metallica retrieve publishing royalties, isn't popular among streaming services. They argue artists' record labels are to blame for not ensuring the songwriting royalties get to the right place. "We are committed to paying songwriters and publishers every penny," Jonathan Prince, a Spotify rep, said in a statement. "Unfortunately, especially in the United States, the data necessary to confirm the appropriate rights holders is often missing, wrong, or incomplete."
Spotify is working with the National Music Publishers Association to overhaul its database and more effectively pay royalties to songwriters and publishers; the NMPA's president, David Israelite, believes a settlement is "the best way forward" and could happen within a few months. In a Q&A, Price tells Rolling Stone he supports a settlement, but he feels streaming services should still be accountable for not paying songwriters.
Spotify is taking a lot of heat for this unpaid royalties issue, from Lowery's lawsuit and in the media. Is it purely a Spotify issue, or do other services have this problem, too?
This is an endemic problem since the launch of Rhapsody over 13 years ago. The problem still exists today. Every company has to deal with the problem of the copyright holders. One of the things I love about the fact that the class action has been filed — it sends a potential message out to a variety of other companies that might be doing this, which is you've got to fix the problem. You can't just sweep it under the carpet.
What's the ultimate risk for the streaming services?
The ultimate risk is damages that exceed $15 billion, and the really distressing part is they did this to themselves.
What made you realize there were issues with streaming services like Spotify and Apple Music properly paying songwriters their royalties?
I really thought that the problem was they had licenses in almost every case, but they just weren't able to accurately pay songwriters and publishers. The concept of, "Holy shit, they're actually not getting licenses to potentially millions of songs!" was insane, but it turned out to be true. That's what we unearthed without trying to.
So explain the problem there.
Sony Records has Whitney Houston record the song "I Will Always Love You," so the recording of the song is owned by Sony, but the songwriter is Dolly Parton. Every time there's a recording of a song that streams on a service like Spotify or Rhapsody or Rdio, there are two royalties, one goes to Sony for the sound recording and one to Dolly Parton as the songwriter. Spotify built no internal infrastructure to deal with this. So they outsourced it to a third-party [company] who they knew could not do it for them.
Spotify expected this third party to take this list of, let's say, 35 million recordings in the service that streamed that month and connect each one of these recordings back to the songwriters.
There are different things that need to happen. "Do I have a license for the composition?" If the answer is "no," then you don't use the music. Second, you need to know who wrote the song. Third, do you have a way to contact them and pay them? And do you have the ability to calculate how much you owe them? There are these different layers to it. The idea that Spotify didn't build any of that stuff, again, seems kind of insane. That's a lot of important stuff.
So the streaming services are using songs without permission?
I'm going to stop there for a second and address the fallacy pushed into the market by the streaming services — "there is no data out there for us to collect, the music industry doesn't have its shit together, people aren't getting paid because the music industry is at fault." Bullshit! If you pick up the phone and ask Bob Dylan what songs he wrote, guess what, Bob Dylan knows what songs he wrote. He knows what percentage he gets publishing for. The problem is the services didn't build the system to take the data.
How can this be fixed?
What we'll get from songwriters is a list of all the songs that they wrote. We got the royalty statements from the interactive streaming services and we analyzed them. "Here's what we're getting paid on, and here's what we're not getting paid on." And, oh my God, what we're not getting paid on is mind-blowing.
Can't the services just fix the problem?
The companies running streaming services have to want to fix it. Clearly it can be fixed. They just have to want to do it. I tell people you should just get a license and pay the songwriters. Why is that so controversial? I know it isn't easy. Being a musician isn't easy either.