The National Music Publishers' Association's (NMPA's) settlement with Spotify -- which Billboard has reported on previously -- will include the streaming service paying $5 million in damages on top of the $16-25 million that the service owes music publishers and songwriters. (A source tells Billboard that the deal has yet to be signed.) Now publishers and songwriters that own their publishing will have to decide between opting in to the settlement or joining one of the class-action lawsuits filed against the service.
Since most interactive music services can't accurately report on and pay the publishers' royalties, chances are likely that the NMPA's template for its Spotify settlement will be brought to other digital services. A source tells Billboard that the template wouldn't remain exactly the same, but would retain the same general structure. When the NMPA brokered a deal between its constituents and YouTube in 2011, most opted in.
According to sources, the NMPA, and apparently publishers, would assist Spotify in building a database at the same time as publishers make claims for royalties owed. After publishers match their claims against the company's play counts, the NMPA would then dole out payment to publishers according to that play accounting. Any money left over after those claims, with the addition of the $5 million penalty, would then be doled out to publishers by market share. In exchange for collecting on the settlement(s), publishers would forfeit any past copyright infringement claims.