Spotify is withdrawing support for two music festivals in protest against a controversial new tax aimed at music streaming platforms operating in France and has threatened more action in the coming months.
Antoine Moninmanaging director of Spotify in France and Benelux regions; went to X this week to criticize new tax which will impose a tax expected to range between 1.5 and 1.75% on all music streaming services, with the proceeds going to the Center National de la Musique (CNM); which was founded in 2020 to support the French music sector.
While all the major music streaming platforms have come together in opposition to the new law, including Apple, Google’s YouTube and local player Deezer, Spotify has been the most vocal. In the wake of last week’s announcement, Spotify said that the move it was a “real blow to innovation” and that it was evaluating its next moves.
The company has now given the first indication of what those moves are, with Monin noting that it will pull support for Francofolies de la Rochelle and Printemps de Bourges festivals starting in 2024, which it supports financially and through other on-site resources. Monin added that “more announcements will follow in 2024,” though he did not specify what those actions might be.
Tête-à-têtes
It’s worth noting that Spotify was recently involved in one tête-à-tête with the Uruguayan government over a new law that promises “fair and equitable” pay for all artists involved in a recording. Spotify argued that the law would mean it would have to pay rights holders twice for the same tracks and would thus ceases to operate in the country. Later, the company made a U-turn when the government gave assurances that music streaming platforms would not be expected to cover any additional costs arising from the law.
France is different, in that it is probably a much bigger market for Spotify and leaving is not a viable course of action. And as Monin hinted last week, its action plan is likely to focus more on reallocating resources to other markets.
“Spotify will have the means to absorb this tax, but Spotify will divest in France and invest in other markets,” Monin said. in an interview with FranceInfo last week. “France does not encourage innovation and investment.”
