Taylor Swift just signed a new record deal with Universal Music Group, and her contract included a provision that benefits other musicians on her label. Universal agreed to share a portion of its profits with musicians, if the label sells its shares of music-streaming service, Spotify.
Musicians get a cut, regardless of debts
Universal, Sony and Warner all own shares of Spotify, and all promised to share proceeds of a sale with musicians before Spotify went public in March. According to Rolling Stone, Swift’s deal goes further because it states artists will be paid proceeds, regardless of whether they owe Universal money for unrecovered advances.
Swift also keeps ownership of her masters
Swift stated this provision was more important to her than any other part of her contract, and she hopes it is a step toward creating positive change for musicians. Her deal also gives her ownership of all her master recordings. Labels often retain ownership of masters.
Currently, Universal owns about 3.5 percent of Spotify, which adds up to about $1 billion at its current value.
Musicians are pushing for change in the industry
This is not the first time Swift has used her considerable influence to try to enact change in the music industry. She boycotted Spotify for three years in protest of their payments to musicians. She also insisted that Apple Music pay artists during its free trial period in 2015. It is also a part of a growing trend of musicians pushing to become business people and protect their music from predatory business practices.
The music industry is notoriously tough to navigate, especially for unknown and emerging artists. Labels often take advantage of their eagerness to put their music out and may push to unfair contracts on them. These contracts may not provide adequate compensation or protect their work through trademark and copyright registration.