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Spotify has revealed plans to increase subscription fee in France , in response to a new tax take aim at music - streaming Service operating in the country .
The move comes intimately three month after the company vowed to begin strip in France , ab initio pulling support from two festivals with the hope of more action to fare this yr — now we have a clearer idea of what form of “ legal action ” Spotify has been misrepresent up .
Thetaxcame into effecton January 1and will see a levy of 1.2 % impose on Spotify and rival service , include Deezer , Apple Music , and Google ’s YouTube Music , with take redirected to the Centre National de la Musique ( CNM ) — established four years agoto patronage the Gallic medicine sector . While all the affect companies are counterbalance the new jurisprudence , Spotify has been the most strident , for the most part due to the fact that it is the great player in the country .
Under wraps
The companywrote in a blog post today :
“ With the creation of this new taxation , Spotify would be required to give approximately two - thirds of every euro it generates to music to right holders and the Gallic authorities . Of course , this is a monumental amount and does not allow for a sustainable business . As we have long say , we simply ca n’t absorb any extra taxes . ”
A Spotify representative secern TechCrunch that it was just try “ to be transparent with our exploiter ” that they should expect a cost hike , and that it had done “ everything we could ” to avert this but there was no way around it .
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Market size
What ’s perhaps the most state part of this whole episode is how crucial France is to Spotify in terms of marketplace traction . Its response here differ somewhat to its response to a similar tête - à - tête in Uruguay , which is also in the outgrowth of go a new law that call “ fairish and equitable ” remuneration for every creative person regard in a recording . Spotify enunciate it wouldpull out of Uruguaycompletely , debate that the law would mean it would have to bear rights holders twice for the same tracks — its terror seemed to mold , and itchanged its mindon pull out when the Uruguayan government gave authority that music - streaming platforms would n’t have to cover any additional costs resulting from the law of nature .
With heed to France , Spotify is convey as much — if not more — grievance with the new tax as it did with Uruguay , yet it has give no indication that it will exit the area . Even though , standardized to Uruguay , it reason that it ’s effectively pay artists double ( “ equivalent to a double payment , ” as Spotify set it ) , it would rather increase its prices than make any kind of noise about leaving the country
In December , Spotifyrevealed that it was rip supportforLes Francofolies de la Rochelleand thePrintemps de Bourgesfestivals , which it had been hold up financially and via other resources . And now that it is increasing its subscription price , this could be the last of its actions against the tax — “ it ’s really about offsetting the price of this revenue enhancement , and we hope that the upcoming toll increase will assure we get there , ” Spotify enjoin in an email statement to TechCrunch .
