This article was originally published on TipRanks.com
Audio streaming subscription service Spotify Technology SA (SPOT) has removed the work of several comedians over royalties and copyright disputes, The Wall Street Journal said. The artists are part of a global rights administration group, Spoken Giants, which was established in 2019. Shares closed at $228.80 on December 3.
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Artists Work Pulled Back
The group is demanding royalty rights and related payments on spoken-word media, which covers words and jokes written by the comedians, similar to how a songwriter’s lyrics are remunerated.
Currently, the comedians are compensated as performers for their labels or distributors. For performances played on digital media, the compensation is paid through their digital performance rights organization SoundExchange. The comedians are not necessarily compensated as writers or owners of the spoken content.
As per the report, Spoken Giants started negotiating with streaming services during spring this year. Since both parties could not come to a deal, Spotify informed the group about its decision to withdraw the work of its artists.
Spotify withdrew the work of several comedians including famous artists such as Tiffany Haddish, Jim Gaffigan, Kevin Hart, and John Mulaney. Other platforms such as SiriusXM, Pandora, and YouTube are also being targeted by the group.
As per the report, “Spotify has paid significant amounts of money for the content in question and would love to continue to do so.” This new stance taken by the artists reflects the revolution in the online listening business and their huge fan following, which the artists plan to leverage on. Only time will tell how and when these negotiations will end, hopefully with a win-win situation for both parties involved.
Wall Street Take
The Wall Street community is cautiously optimistic about the stock with a Moderate Buy consensus rating based on 12 Buys, 4 Holds, and 2 Sells. The average Spotify price target of $317.33 implies 38.6% upside potential to current levels. Shares have lost 33.1% over the past year.
TipRanks’ Website Traffic tool, which uses data from SEMrush Holdings (SEMR), the world’s biggest website usage monitoring service, offers insight into Spotify’s performance.
In October, Spotify website traffic recorded a 30.93% year-over-year increase in monthly visits. However, year-to-date website traffic growth decreased by 1.89% compared to the same period last year.
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