Why Spotify’s Royalty Fight With Comedians Is A “Double Edged Sword”

Recently, Spotify (SPOT) deleted the recordings of hundreds of comedians – including the works of Jim Gaffigan, John Mulaney and Kevin Hart – amid a royalty dispute.

It’s a move that highlights the struggle many podcasters, comedians, poets and other spoken word artists face as streaming dominates the entertainment industry and raises questions about how to compensate for those involved.

Spoken Giants, a rights administration company founded in 2019, has led the fight against royalties for these types of artists. CEO Jim King, who previously worked as an executive for the performing rights organization BMI, said the company “is a reflection on the growing importance and power of spoken word.”

Attacking the rights of comedians is the first step in the effort.

Historically, “comedy has been paid for the main recording or sound recording, but comedians have never been paid for their writing,” King told Yahoo Finance Live in an interview.

He added that the goal is to reflect the same payment structure of songwriters, who receive their own royalty payments within the music industry.

“We’re not trying to recreate anything. We’re not trying to set new precedents. From a pricing perspective, we believe comedy writers should be paid the same as writers- composers, lyricists and songwriters are in the music industry, ”explained the CEO.

According to Spoken Giants, the current target rate per feed is $ 0.004; therefore, a comedy with 50,000 plays per month will incur $ 200 in royalties. A comedy with 1,000,000 annual plays equals $ 4,000 in royalties, and so on.

‘A double-edged sword’

The Spotify logo displayed on a phone screen and headphones can be seen in this illustrative photo taken in Poland on October 18, 2020. (Photo Illustration by Jakub Porzycki / NurPhoto via Getty Images)

In response to a request from Yahoo Finance, a spokesperson for Spotify said the streaming giant had spent “significant sums on the content in question, and would like to continue to do so.”

However, “as Spoken Giants disputes the rights of various licensors, it is imperative that the labels that distribute this content, Spotify and Spoken Giants come together to resolve this issue to ensure that this content remains available to fans. around the world, ”the spokesperson said. added.

King revealed that Spoken Giants had contacted the streaming platform “several times” since the decision to remove the comedians on the eve of Thanksgiving.

“We would love to work with them. Our aim is to support Spotify as an important platform in the industry, but also, very importantly, to support our members. We are very surprised by this aggressive decision and we want to speak to them directly. and resume negotiations as soon as possible, ”added King.

Spotify remains a huge platform for comedians and the removal is a huge blow to artists who value visibility and better access to fans.

“It’s a double-edged sword for consumers, for platforms, and very important for our members,” King said.

But he explained that the support is still there, noting that the company has seen a “strong rallying cry” from customers whose membership numbers “increase dramatically” since the first withdrawal.

“We are seeing almost 100% support for what we are working to do on their behalf. Our goal is to resolve this issue as quickly as possible to get them back to this platform,” he concluded.

Alexandra is a producer and entertainment correspondent at Yahoo Finance. Follow her on twitter @ alliecanal8193

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