Warner Music announces new deals with Spotify and Amazon

Warner Music Group and Spotify have announced a new multi-year agreement covering both recorded music and music publishing. It effectively ends the companies’ dispute over the streaming giant’s “bundling” option, which pays rights holders fewer royalties by offering audiobooks and music together for a reduced subscription fee. A few days ago, Universal Music entered into a similar agreement with Spotify. While terms of the deal were not announced, it appears a compromise has been reached on royalties, reported by Variety.

Warner Chappell Music

The new deal will help provide fans with new experiences, a deeper catalog of music and videos, additional paid subscription tiers and differentiated content packages. The deal also builds on the companies’ existing agreement on “artist-centric” royalty models that reward and protect artists while helping them attract audiences.

Like the Universal deal, the new publishing deal introduces a direct licensing model with Warner Chappell Music in several other countries, including the U.S. During the earnings call, CEO Robert Kinkle also announced a new licensing deal with Amazon Music. The deal provides new benefits for artists, songwriters and fans, and unlocks further collaborations that expand the music ecosystem. It’s a big step forward in better alignment between rights holders and streaming services.

Warner Earnings Report

The announcement came alongside a mixed Warner earnings report, in which total revenue fell 5% (4% in constant currency) and operating income fell about 40% to $214 million from $354 million in the year-ago quarter. Top sellers included Linkin Park, Charli XCX, Teddy Swims, Mariya Takeuchi and Benson Boone.