Spotify Acquires Blockchain Startup to Tackle Royalty Issues

No Comments 1 May 2017

Spotify Acquires Blockchain Startup to Tackle Royalty Issues

Spotify, the $8 billion music streaming service provider, which is projected to reach 100 million users and a $53 billion valuation by 2020, acquired Mediachain, a startup backed by leading venture capital firm Andreessen Horowitz, to simplify royalties utilizing bitcoin’s underpinning technology.

In March, Spotify found itself amidst legal troubles with its partnered musicians, record labels and producers over unpaid royalties. According to the announcement of the National Music Publishers’ Association (NMPA), Spotify settled a $25 million deal and a $5 million penalty over unpaid and unmatched songs.

Upon the settlement of the $30 million deal, Spotify’s Global Head of Communications and Public Policy Jonathan Prince admitted that while the company has been committed in compensating its musicians and publishers since its launch in October of 2008, tracking all of its registered songs streamed by tens of millions of users and distributing royalties accurately and proportionally has been difficult.

“As we have said many times, we have always been committed to paying songwriters and publishers every penny. We appreciate the hard work of everyone at the NMPA to secure this agreement and we look forward to further collaboration with them as we build a comprehensive publishing administration system,” Prince stated.

At the time, NMPA President and CEO David Israelite emphasized that through the multimillion-dollar deal, music streaming service providers including Spotify will allocate more resources into compensating musicians and publishers transparently and properly. He further noted that NMPA and Spotify found the appropriate method of distributing royalties to music creators.

Read More/Original Source: http://m.nasdaq.com/article/spotify-acquires-blockchain-based-startup-to-tackle-fair-royalty-issues-cm781649

 

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