In response to recent developments in Uruguay’s copyright legislation, Spotify, a leading music streaming platform, has announced its decision to discontinue services in the country. The decision comes following the approval of an amendment to Uruguay’s copyright law by the Uruguayan Parliament, requiring “equitable remuneration” for artists.
The approved bill, known as “Rendición de Cuentas,” proposed amendments to Articles 284 & 285 of Uruguay’s copyright law, introducing a mandate for “fair and equitable remuneration” for artists related to their recorded material. Additionally, the bill stipulates that “social networks and the Internet” should be treated as platforms where performers are entitled to financial compensation when their music is reproduced.
Spotify had initially expressed concerns about the lack of clarity and the introduction of an additional mandatory payment for music services when the bill was first tabled in July. The streaming giant, in a letter to Uruguay’s Minister of Education, Pablo Da Silveira, emphasized that the proposed changes could render its business in Uruguay unfeasible, negatively impacting Uruguayan music and its fan base. Spotify argued that the amendments would result in a doubling of royalty payments.
In an official statement released yesterday, Spotify confirmed its phased withdrawal from Uruguay, with operations set to cease entirely by February 2024. The statement highlighted the company’s commitment to paying nearly 70% of its generated revenue to record labels and publishers, contributing over $40 billion to date. Spotify expressed concerns that additional payments, as mandated by the amended law, would make its business untenable.
The statement also addressed the positive impact of streaming on Uruguay’s music industry, noting a 20% growth in 2022 alone. Despite the withdrawal, Spotify emphasized its pride in being a significant revenue driver for artists, songwriters, and the music industry as a whole.
Gabriela Pintos, a spokesperson for the Uruguayan Society of Performers (SUDEI), clarified that the organization is not against platforms like Spotify but advocates for fair distribution of royalties. Pintos emphasized that the legislation aims to ensure artists can negotiate a percentage that corresponds to their contributions, aligning with global efforts to address digital reproduction of music.
As the situation unfolds, the withdrawal of Spotify from Uruguay raises broader discussions about the intersection of technology, copyright legislation, and the fair compensation of artists in the digital age.
