Spotify starts ‘disinvesting’ in France in response to new music-streaming tax

Spotify is pulling support for two music festivals in protest against a controversial new tax directed at music-streaming platforms operating in France, and threatened more action will follow in the coming months.

Antoine Monin, managing director for Spotify in the France and Benelux regions, took to X this week to decry a new tax that will impose a levy of what is expected to be between 1.5 and 1.75% on all music-streaming services, with the proceeds going toward the Centre National de la Musique (CNM), which was established in 2020 to support the French music sector.

While all the major music-streaming platforms have come together in opposition to the new law, including Apple, Google’s YouTube and local player Deezer, Spotify has been the most vocal. In the wake of the announcement last week, Spotify said that the move was a “real blow to innovation,” and that it was evaluating its next moves.

The company has now given the first indication of what those moves are, with Monin noting that it will pull support for Francofolies de la Rochelle and the Printemps de Bourges festivals starting from 2024, which it has been supporting financially and via other on-the-ground resources. Monin added that “other announcements will follow in 2024,” though he didn’t elaborate on what those actions might be.

Tête-à-têtes

It’s worth noting that Spotify was recently embroiled in a tête-à-tête with the Uruguayan government over a new law that promises “fair and equitable” remuneration for all artists involved in a recording. Spotify argued the law would mean it would have to pay rightsholders twice for the same tracks, and it would thus cease operating in the country. The company later pulled a 180-degree turn when the government gave assurances that music-streaming platforms wouldn’t be expected to cover any extra costs resulting from the law.

France is different, insofar as it’s likely a much bigger market for Spotify and pulling out is not a viable course of action. And as Monin hinted at last week, its plan of action is likely to center more around reallocating resources to other markets.

“Spotify will have the means to absorb this tax, but Spotify will disinvest in France and will invest in other markets,” Monin said in an interview with FranceInfo last week. “France does not encourage innovation and investment.”