It is being reported this week that YouTube and Spotify’s longer-term licensing agreements have expired with at least two if not three of the major record labels. As a result they are apparently going forward in the meantime on the basis of month-to-month rolling contracts.
Is this a problem?
In both cases, the music continues to be licensed, it’s just that there isn’t much certainty in the longer term.
For Spotify, it’s not immediately a problem, and you would think that a deal would be reached. There’s no reason a month-to-month agreement can’t continue for a while whilst new terms are discussed. And the record labels (who are also Spotify shareholders) wouldn’t exactly be popular if they pulled all their music at short notice (not to mention the fact that it wouldn’t be in their financial interests either.
For YouTube, however, it’s potentially a bigger problem since users don’t generally pay to watch the videos and the record labels would no doubt prefer to change that situation. Perhaps negotiations there might get a bit tricker.
Check out the full story at the MusicAlly blog.