Merlin Opposes Last.fm's Artist Royalty Program

Last.fm's Wednesday launch of its Artist Royalty Program, which pays money directly to artists or labels whenever their music is played, has raised the ire of Merlin, an international rights body that represents over 12,000 independent labels. (Combined, Merlin's labels control more music than the smallest major label, EMI.)

Merlin claims Last.fm's Artist Royalty Program (ARP) doesn't pay artists retroactively for past plays and is vague as to what rights the license gives CBS/Last.fm regarding uploaded music. In addition, Merlin is upset that direct contracts between independent copyright holders and Last.fm seem to have undermined Merlin's negotiations with Last.fm to license its members' music to the service.

• The Program announced (yesterday) does not appear to offer anycompensation for any past illegal use of repertoire. It is unclear tous whether or not the terms and conditions of the Program are intendedto prevent master owners pursuing such compensation.
• As you will be aware, we have for the last few months beennegotiating with Last.fm regarding a non exclusive blanket license anda settlement agreement on behalf of Merlin members. Unfortunately,
  these negotiations have stalled - in particular due to Last.fm'sunwillingness to properly address its illegal infringing activity.
• Several provisions of the license terms and conditions ofthe Program appear ambiguous and open to legal interpretation. We notethat this would tend to lead to uncertainty as to the "true" meaning ofthe license. The license points out that if you are unsure about any ofit, "You are advised to obtain independent legal advice" - we wouldendorse that view.

Indie labels who are members of Merlin could be better off waiting for negotiations to continue, since Merlin's requested terms are most likely favorable to those offered as part of Last.fm's ARP. However, for non-member labels and unsigned bands, Last.fm's ARP is a promising step forward, in terms of compensation and transparency.

Update: Last.fm has responded to Merlin's opposition to its Artist Royalty Program:

The Artist Royalty Programunderscores the respect we have, at Last.fm, for artists and songwriters. Theprogram, which goes beyond working just with the majors and big indies where wehave deals, extends the benefits to independent artists, giving them a chanceto share in the value their music creates. While we are disappointed thatMerlin is talking publicly about our discussions, we respect them and theirmembers, and will continue to work hard to close a deal with them.

See also:

• Indies: The Fifth Major Label?
• Indie Music Takes on the Majors
• Last.fm Compensates Artists, Unlike Some People We Know
• Warner Music Group Pulls Music from Last.fm
• MySpace Music Won't Give Equity to Indie Bands