Spotify has just inked a new deal with Merlin – an independent label organization – that is similar in some respects to their recently signed Universal Music deal. The multi-year licensing agreement will ensure a steady flow of new music from labels outside the sphere of the “majors.”
The similarity in the deals is not about the streaming royalty fees, but in the idea of “Windowed” albums. The UMG deal allows Universal to preview albums to non-paying members of the stremaing service. Certain albums will be exclusive to premium subscribers only.
The deal with Merlin allows the indie labels to do the same with it’s artists. Merlin has worked with Spotify since 2008 under a single global license arrangement. CEO of Spotify, Daniel Ek, is “super happy” about the deal and members of Merlin believe the deal will allow for sustainable growth in the coming years.
Spotify still has a couple of big players to bring to the table – namely Warner and Sony. But this new deal is significant in the global music market.
Merlin represents over 20,000 indie labels, who collectively make up roughly 12 percent of the global digital music market. The deal will give Merlin’s members, including Beggars Group, Domino, Epitaph/Anti, Kobalt Music Recordings, Secretly Group, Sub Pop and many others, improved access to data and marketing opportunities going forward.
According to the Recording Industry Association of America, streaming accounts for over half of all U.S. recorded music revenue. 2016 was the first year of growth for the recorded music business, following decades of decline.