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2 Berkeley J. Ent. & Sports L. 180 (2013)
Spotify: Incentivizing Album Creation through the Facebook of Music

handle is hein.journals/bjesl2 and id is 189 raw text is: Spotify: Incentivizing Album Creation Through The Facebook of Music David von Wiegandt Introduction................................................ 180 What is Spotify? ........................................... 181 The Legal Environment Surrounding Spotify................................ 183 Licenses with Record Labels ........................................... 185 Licenses with Performing Rights Organizations ............................ 187 Licenses with Other Music Distributors ................... ........ 188 Spotify and Social Norms ................................ ..... 188 Eliminating Piracy through Spotify . ......................... ..... 190 Artists Get Paid Very Little through Spotify ................... ..... 192 A Solution: Removing the Interactive Distinction in the Statute................... 194 Conclusion ................................................ 199 INTRODUCTION Spotify, a Swedish-based music streaming service, hit the U.S. market in July of 2011.1 It is quickly becoming a leading music service, allowing users to 2 choose from over 15 million songs to listen to any time they wish. Unlike services like Pandora, Spotify is considered an interactive service because it provides on-demand streaming of any song at any time. As a result of its interactive nature, Spotify is unable to use the compulsory music licenses provided to services like Pandora, and instead is forced to negotiate directly with record labels to gain access to their master sound recordings. Spotify has successfully negotiated licenses with every major record label, in part by selling these labels stock in its company.3 Spotify has also obtained licenses 1. Jacqui Cheng, Spotify's US Launch: Three Tiers, Free is Currently Invite-Only, Ars Technica, July 14, 2011, http://arstechnica.com/media/news/2011/07/music-service-spotify- finally-to-launch-in-us-on-thursday-morning.ars. 2. Jason Kincaid, Live Blog: The Spotify Special Event, Tech Crunch, Nov. 30, 2011, http://techcrunch.com/2011/11/30/live-blog-the-spotify-special-event!. 3. Seth Fiegerman Spotify Launches in U.S.: Should You Care?, The Street, July 15, 2011, http://www.thestreet.com/story/11186953/1/spotify-launches-in-us-should-you-care.html. 180

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