Spotify to pull support for French music festivals in protest against new tax
Spotify has announced that it will withdraw its support for two music festivals in France. This is in response to a controversial new tax imposed on music streaming platforms operating in the country. The company’s managing director for France and Benelux, Antoine Monin, took to Twitter to decry the new tax, which is expected to levy a charge of 1.5 to 1.75% on all music streaming services. The proceeds will go to the Centre National de la Musique (CNM) to support the French music sector.
The major music streaming platforms, including Apple, Google’s YouTube, and Deezer, have come together to oppose the new law. However, Spotify has been the most vocal in its opposition. The company has described the move as a “real blow to innovation” and is evaluating its next steps in response to the new tax.
Now, Spotify has revealed its first action in response to the tax. The company will pull support for the Francofolies de la Rochelle and the Printemps de Bourges festivals beginning in 2024. Spotify has been financially supporting these festivals and providing other resources. Monin hinted that more actions will follow in 2024, but did not provide details.
Notably, Spotify was recently in a dispute with the Uruguayan government over a new law that would require fair and equitable remuneration for artists involved in a recording. Spotify initially announced that it would cease operating in Uruguay, but later reversed its decision when the government assured that music streaming platforms would not have to cover additional costs resulting from the law.
In contrast to the situation in Uruguay, Spotify views France being a much larger market, and pulling out is not a viable option. Monin suggested that the company’s strategy will likely involve reallocating resources to other markets. He stated in an interview that while Spotify has the means to absorb the new tax, it will disinvest in France and invest in other markets. Monin added that France does not promote innovation and investment.
Spotify’s decision to withdraw support from French music festivals is a clear signal that the company is prepared to take a stand against the new tax. As the situation unfolds, it will be interesting to see what further actions the company plans to take in response to the controversial new levy.
