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I don't know if the economic advantages to this move are going to be true. They will have to pay the compulsory royalties for these spins, but they already have agreements to pay a % of ad revenue to the labels who they have direct licenses from, and a % of subscriber revenue. Unless they foresaw this or have managed to rework their licensing agreements, it stands to reason that they may still pay the higher amount on these streams, and may even pay more for playing things that aren't in their catalog, where they have to pay both the SX royalties, plus their normal fees to their direct content providers.

Not sure I agree

"...online radio roaylty rates are generally lower than for on-demand."

I don't believe this statement is accurate.

If it were, then Spotify would have chosen the radio model instead of negotiating direct licenses in the first place.


I was thinking the same thing. Does anyone have real numbers to shed some light on this?

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