After months of negotiations, Sony Music Entertainment has reached a licensing agreement with Spotify, sources tell Billboard, becoming the second major label to do so this year and paving the way for the streaming service to go public.
The deal, expected to close imminently, comes on the heels of Spotify’s multi-year licensing agreement with Universal Music Group announced in April. The terms of Sony’s deal with Spotify weren’t clear. Spokespeople for Sony and Spotify declined to comment.
UMG’s deal gives Spotify a break on the percentage of revenue that it must pays UMG in royalties as its subscriber base grows, going down to about 52 percent of revenue from 55 percent, sources have told Billboard. UMG’s deal also gives its artists the ability to limit their albums to Spotify’s paid tier for two weeks after release -- though no big acts have yet taken advantage of that freedom to date.