Spotify Begins Divestment from France as Reaction to Music Streaming Tax

Spotify is pulling support for two music festivals in protest against a controversial new tax directed at music-streaming platforms operating in France, and threatened more action will follow in the coming months. 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 the announcement last week, Spotify said that the move was a “real blow to innovation,” and that it was evaluating its next moves. The company later pulled a 180-degree turn when the government gave assurances that music-streaming platforms wouldn’t be expected to cover any extra costs resulting from the law. “Spotify will have the means to absorb this tax, but Spotify will disinvest in France and will invest in other markets,” Monin said in an interview with FranceInfo last week.

Spotify has announced that it will be withdrawing support for two popular music festivals in protest against a controversial new tax aimed at music-streaming services in France. The company’s managing director for the France and Benelux regions, Antoine Monin, made the announcement, promising more action to come in the future.

Monin expressed his frustration with the new law, stating that it will impose a levy of between 1.5 and 1.75% on all music-streaming platforms, with the proceeds going towards the Centre National de la Musique (CNM). This organization was established in 2020 to support the French music sector.

“All major music-streaming platforms, including Apple, Google’s YouTube, and local player Deezer, have joined together in opposition to this new law,” Monin stated.

Spotify has been particularly vocal in its opposition and has stated that this move is a “real blow to innovation.” The company is currently considering its next steps and evaluating the impact of this tax on its operations.

In a show of protest, Spotify has announced that it will no longer be supporting the Francofolies de la Rochelle and the Printemps de Bourges festivals. These festivals, which the company has been providing financial support and on-the-ground resources for, will no longer receive support from Spotify starting in 2024. Monin also mentioned that there will be further announcements in 2024, though he did not provide any specifics on what these actions might entail.

It’s worth noting that Spotify has recently been embroiled in discussions with the Uruguayan government over a new law that promises fair and equitable remuneration for artists involved in a recording. The company argued that this law would result in paying rightsholders twice for the same tracks and ultimately threatened to cease operations in the country. However, they reversed this decision after receiving assurances from the government that music-streaming platforms would not be expected to cover any additional costs resulting from the law.

France presents a different situation for Spotify, as it is a much larger market and simply pulling out is not a feasible option. As Monin alluded to last week, their plan of action will likely involve reallocating resources to other markets instead.

“Spotify has the means to absorb this tax, but we will be disinvesting in France and investing in other markets,” Monin explained in an interview with FranceInfo.

“France does not encourage innovation and investment,” he added.

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Ava Patel

Ava Patel is a cultural critic and commentator with a focus on literature and the arts. She is known for her thought-provoking essays and reviews, and has a talent for bringing new and diverse voices to the forefront of the cultural conversation.

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