Digital

Universal to licence Last.fm directly

By | Published on Tuesday 12 July 2011

Last.fm

Universal Music has announced it will licence all of Last.fm’s streaming services directly, rather than via collecting societies like PPL, according to Music Week. Previously some elements of Last.fm’s offering in the UK were licensed by the music major directly, while others were covered by PPL licences.

The use of collecting societies, or not, in the digital domain is a big debate in the music business just now, of course, with regards to both recording and publishing rights. Unlike, say, with radio, there is no obligation on rights owners to license digital services through a central collecting society. In the main the record companies have chosen to licence digital services directly, while the publishers have chosen to licence many of their digital rights through societies, but the situation is in a constant state of flux.

Most in the industry agree the current system for licensing digital music platforms is not ideal, but there is disagreement as to how things should change. Some reckon all digital rights should be licensed through collecting societies, so that digital service providers would only need two or three licences from relevant societies in each territory, and would be charged industry-wide standard rates, opening up the market to digital start-ups who can’t afford to pay large upfront advances.

Others argue that all digital rights should be licensed directly by labels and publishers, cutting out collecting societies completely. Although this would mean digital service providers would have to negotiate their own rates and terms with each major music company and indie label aggregator, some say that this way rights owners could offer multi-territory, or even global, licenses, actually simplifying things for digital companies with ambitions to operate worldwide.

In reality, Universal cutting PPL out of the Last.fm relationship isn’t that big a deal. The record labels have generally kept their collecting societies out of digital deals anyway, with only the most simple of interactive radio services (so, Pandora style) being covered by PPL licences (though arguably Mixcloud have pushed the boundaries on that a little). But, following EMI’s recent decision to take some of its publishing rights away from US collecting society ASCAP in the digital domain, Universal’s move is seen by some as part of a trend of big rights owners pulling away from the collective licensing system for digital just at a time when others are arguing they should be embracing that approach full on.



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