The National Music Publisher’s Association (NMPA) held its yearly gathering at Alice Tully Hall in Lincoln Center, New York. The New York event honored songwriters including Lana Del Rey, featured a fireside chat with WMG CEO Robert Kyncl, and the reveal of the U.S. music publishing revenue in the last year — $6.2 billion — but what got the most attention was the raised concerns about Spotify‘s bundling strategy.
NMPA President & CEO, David Israelite, outlined a complaint the organization sent to the FTC regarding Spotify’s bundling scheme, urging government intervention. It’s estimated that Spotify will pay $150 million less in music royalties this year because of its audiobook bundling.
The NMPA alleges that Spotify is misleading its customers by automatically switching its music subscribers to these bundled plans without their consent. They argue that Spotify is not providing an option for subscribers to switch back to a music-only subscription and is making it difficult to cancel through confusing website interfaces and dark patterns. The NMPA hopes the FTC will take action against Spotify’s bundling, pointing out that its Audiobook Access Tier is exclusively available in the United States, which they see as an attempt to exploit U.S. royalty regulations established in the Phonorecords IV settlement.
Israelite criticized Spotify’s move to reclassify its music service as an audiobook bundle as a cynical and potentially illegal action, disrupting the peace agreed upon in 2022. The NMPA is considering all options and has filed a complaint with the FTC. Although an agreement was reached to modernize the treatment of bundled products or services containing music streaming, the NMPA accuses Spotify of violating the spirit of the agreement by offering Premium plans at a rate lower than the established headline rate for 2024.
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