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Digital Music: Spotify & Ministry of Sound Settlement

Last September, Ministry of Sound initiated proceedings before the English High Court seeking an order requiring Spotify to remove from its service playlists created by users that mirrored Ministry of Sound compilation albums.

Spotify is licensed by artists and record companies to stream individual tracks,  Ministry’s claim, however, appears to have essentially been that its compilation albums should be protected by copyright as an intellectual creation in their own right (separate from the individual tracks) due to the selection and arrangement involved in compiling the albums.  It is understood that Ministry also wanted Spotify to block users that made use of its branding and artwork when creating and sharing the playlists.

The terms of the settlement are confidential, but media reports suggest that Spotify has agreed to remove the playlists in question and to block users from following such lists.  It is understood that the settlement was amicable and that discussions between the companies will continue with the possibility of some collaboration in future.

The growing success of online subscription streaming services, such as Spotify, is one of the statistics highlighted in the International Federation of the Phonographic Industry’s (IFPI) Digital Music Report (available here). The IFPI, which represents the music industry worldwide, noted that revenues from such services grew 51% in 2013, exceeding the global $1 billion threshold for the first time. The trend towards digital sales and streaming is also evident in the news that physical format sales value declined by 11.7% in 2013.