Streaming platform and record label join forces for 'ambitious' change to royalties

Universal Music Group (UMG) and independent streaming platform Deezer have announced the “most ambitious change” to the economics of streaming since its creation, with the launch of a new model promising higher royalties for artists.

The collaboration between UMG, the world’s largest record company, and French streaming platform Deezer means artists will be paid double if users actively search for their music, rather than listening to it when a song auto-plays.

And performers deemed to be “professional artists” – those who generate at least 1,000 streams a month from a minimum of 500 listeners – will also receive double that of non-professionals.

The amount of money paid to music acts through streaming has been a huge issue in the industry in recent years.

Stars – including Nile Rodgers, Noel Gallagher, Lily Allen, Gary Barlow, Paul McCartney and Robert Plant – have all criticised the current model used by streamers.

A UK inquiry also concluded in 2021 that musicians and songwriters receive “pitiful returns”.

Taylor Swift famously boycotted Spotify for a period from 2014, saying at the time that “music should not be free”.

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While Deezer is a relatively small platform compared with the likes of Spotify and Apple Music, Deezer and UMG’s new model could have a significant impact should its rivals follow suit.

Change is ‘ambitious’ and ‘necessary’

“This is the most ambitious change to the economic model since the creation of music streaming and a change that will support the creation of high-quality content in the years to come,” said Jeronimo Folgueira, chief executive of Deezer.

“We are now embracing a necessary change, to better reflect the value of each piece of content and eliminate all wrong incentives, to protect and support artists.”

Other changes include the replacement of “non-artist noise content” which makes up about 2% of streams on the platform – including background sounds such as rain or birds tweeting – with Deezer’s own content, which will not receive royalties.

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The company has also promised to continue work to tackle fraud and protect royalties.

The model will launch in France at the end of 2023 before it is widened out.

“The goal of the artist-centric model is to mitigate dynamics that risk drowning music in a sea of noise and to ensure we are better supporting and rewarding artists at all stages of their careers, whether they have 1,000 fans or 100 thousand or 100 million,” said UMG’s Michael Nash, adding that music by artists “that attracts and engages fans will receive weighting that better recognises its value”.

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