We’re taking a look at the legal side of the music industry, especially regarding deepfakes, TikTok’s latest, and the Hipgnosis Songs Fund... Let's dive in!
#1. New Legislation to Combat AI Deepfakes in the US
A bipartisan group of US Senators has introduced the NO FAKES Act to combat AI deepfakes in the music industry. The bill aims to establish federal rights over individuals' voices and images. Major industry players, including Warner Music Group, Universal Music Group, and Sony Music, have backed the initiative. They stress the need to protect the identity of creators and limit unauthorized content generated by artificial intelligence.
The new law would allow individuals to request the removal of "deepfake" content and to sue infringers, but of course includes exceptions for news, commentary, and parodies. The Recording Industry Association of America (RIAA) and other groups showed their support, sensing this as essential for the ethical use of AI. This legislation will regulate the impact of AI on intellectual property and individual rights, alongside other bills such as the COPIED Act and the Generative AI Copyright Disclosure Act.
#2. A decelerated growth in music streaming
Following the trend, music streaming is witnessing a slowdown in subscriber growth, with major services like Spotify, Apple Music, and Amazon Music being affected. Spotify's Q2 2024 report showed a 14% year-on-year increase in monthly active users to 626 million. Quite an interesting number, but this was below expectations. To address this, Spotify plans to enhance its free tier and launch a higher-priced 'deluxe' subscription with additional features. Deezer reported a 14.9% revenue increase in H1 2024, yet faced a decline in direct subscribers outside France, prompting a focus on established markets and new service packages.
Universal Music highlighted similar trends, noting a slowdown in subscription revenue growth from some major platforms. UMG indicated that while Spotify and YouTube have maintained subscriber growth, other large services are struggling to attract new users. This slowdown, along with a decline in ad-supported streaming revenue due to changes in licensing agreements, underscores the need for streaming services to innovate and diversify their offerings to sustain growth.
#3. Best practices to distribute on Apple Music
The app has implemented new download requirements for all new releases, designed to improve the listener experience. Digital music distributors have received the new requirements, which won’t impact previous releases.
From now on, all uploaded songs will include both lyrics when they contain vocal content and one or more of the roles of each of its three contributor groups: songwriter, performers, and production & engineering. We can’t help to see the need for a well-organized catalog to fit these requirements, which are fully aligned with the current trend of the music industry working to get data insights for a better recommendation algorithm.
If you’re looking for a way to organize your catalog in a workspace, you know where to find us!
#4. The Ministry of Justice responds to TikTok lawsuit
The U.S. Department of Justice has defended a new law requiring ByteDance to sell TikTok or face a ban. Following the announcement, TikTok and ByteDance filed a lawsuit against the law signed by President Joe Biden last spring, which requires TikTok to sell its U.S. operations or face a ban from next January.
In a response filed Friday with the U.S. Court of Appeals for the District of Columbia, the Justice Department expressed concern that TikTok could be used by the Chinese government to collect sensitive data on Americans, again. In particular, it cited classified information from the intelligence community to back its claims about the app's threat to national security.
Although TikTok has assured that it has implemented significant measures to address the government's concerns, the department believes these measures are insufficient and highlighted the potential for China to use its app's vast reach to undermine American interests, noting the risk of the Chinese government manipulating TikTok's algorithm to covertly influence public opinion.
#5. Hipgnosis Songs is no longer a listed company
Today marks the end of an era for the Hipgnosis Songs Fund (HSF). Listed on the London Stock Exchange in July 2018, the company saw its listing canceled on the morning of July 30, 2024. Private equity giant Blackstone had notably acquired HSF after a bidding war with Concord, following a shareholder vote on July 8 in favor of a $1.584 billion offer.
HSF, which owns 138 catalogs with copyrights on over 40,000 songs, is to transfer all its share capital to Lyra Bidco, an entity financed by Blackstone. This acquisition, approved by a British court, took effect on July 29, with changes to HSF's board of directors.
Following this cancellation, Blackstone now holds two portfolios under the Hipgnosis brand: Hipgnosis Songs Fund (HSF) and Hipgnosis Songs Capital (HSA), which owns rights to artists such as Leonard Cohen and Justin Timberlake. Hipgnosis Song Management (HSM), headed by Ben Katovsky, continues to advise HSF and HSA.
