Shattering industry norms, BMG has signed a multiyear direct licensing agreement with Spotify that bypasses traditional intermediaries, marking a significant shift in how music publishers and streaming services collaborate. The landmark deal, set to commence in 2025, represents BMG’s strategic move to take direct control of its digital business, following the company’s late 2023 decision to transform its operational approach to streaming platforms.
The agreement aims to deliver greater value to songwriters through enhanced transparency and a fairer distribution of streaming revenue. By eliminating collection societies and aggregators from the equation, BMG can now manage relationships directly with Spotify, leveraging detailed streaming data to guarantee creators receive compensation aligned with real-world music usage. This approach addresses longstanding concerns about the “bundling loophole” that many creators felt Spotify had previously exploited.
Both companies emphasize that this partnership reflects a shared interest in reshaping licensing for mutual benefit in the digital age. Spotify views stronger industry collaboration as vital to music’s future, while BMG sees this as an essential step in redefining what it means to be a “modern music company” that prioritizes fair representation for creators. The deal includes explicit provisions that support the nonnegotiable protection of artists’ works while embracing AI’s potential to enhance human creativity.
The deal includes specific provisions addressing artificial intelligence, with BMG supporting Spotify’s stance on AI protections within licensing terms. These commitments safeguard artist rights while acknowledging the evolving technological landscape of music creation and distribution. BMG CEO Thomas Coesfold has publicly endorsed Spotify for its strong measures against AI misuse in the industry.
BMG joins several major publishers engaging in direct licensing with Spotify, including Universal Music Group, Warner, and Sony, signaling a broader shift in negotiating power from traditional collectives to direct publisher-platform arrangements. This trend potentially resolves ongoing legal disputes involving mechanical licensing while reducing complexity around digital music rights.
Industry observers note this agreement could serve as a template for future deals, potentially establishing new standards for transparency, operational efficiency, and creator compensation in an increasingly streaming-dominated music ecosystem. This partnership exemplifies how musicians can secure more reliable streaming royalties through direct licensing arrangements between publishers and platforms. The partnership demonstrates how direct collaboration can potentially benefit all parties in the value chain. This direct approach aligns with the growing importance of royalty structures for artists seeking fair compensation in today’s digital music landscape.
