Business

Kobalt and Downtown cut ties with Russia; News continues to be active in the market but is ‘monitoring the situation very closely’

The music business’s relationship with Russia is a fast-moving story right now.

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Before we get into the details of the latest developments, MBW has an important update to the story we brought to you yesterday (March 10).

In that story, we told you correctly that Spotify is no longer taking any money out of Russia – through advertising or subscribers – and so obviously does not pass on such (non-existent) funds to music copyright holders.

However, a Spotify spokesperson told MBW: “Spotify continues to pay copyright holders for music streams in Russia.”

In other words, Spotify seems to be subsidizing royalties will was created on its platform in Russia if it is not canceled monetizing its services and is paying that cash out for brands and publishers.

Meanwhile, two of the biggest music companies in the industry – Kobalt music group and Downtown – in the last 24 hours both confirmed that they are suspending business in/with Russia.

In doing so, they joined all three major music companies (Universal, Sonyand Warner) – each of them announced this week that they are suspending their own trading activities in the market.

“Kobalt will be suspending all business in Russia and has voiced support for any decision by us to remove the local Russian collection organization, RAO, from its network of collection associations. “.

Spokesperson for Kobalt

A Kobalt spokesman said: “Like the rest of the world, we in Kobalt are deeply disturbed by Russia’s unprovoked and illegal invasion of Ukraine. We call for and hope for a peaceful resolution of the conflict soon.

“To support practical humanitarian efforts, Kobalt has donated to the following organizations: Global Donation – Ukraine Crisis Relief Fund, International Rescue Committeeand Save children.

“Additionally, Kobalt will be suspending all business in Russia and has voiced support for any decision we take on any decision that would eliminate the local Russian collection organization, the RAO. , from the network of collectors associations.”

Downtown Music Holdings The CEO, Andrew Bergman, sent a memo to his employees yesterday that read: “With immediate effect, Downtown will be suspending all business with Russia.

“This means that we will not distribute any new music to Russian DSPs including Yandex, VKontakte and Zvooq, we will cease all local music publishing royalties. and we will exclude Russia from all sync licenses worldwide.

“We are encouraging all international music organizations to join in solidarity with Ukraine.”

Andrew Bergman, City Center

“While music copyright has previously been managed on a local basis, in this regard, we believe that the global music industry should have one voice. To that end, we are encouraging all international music organizations to unite with Ukraine.”

Bergman also confirmed that Downtown is donating funds to Ukraine-related NGOs including the ICRC, the International Rescue Committee, and UNICEF.

One of the world’s most prominent independent music companies – headquarters in Paris Believe – told MBW that it currently has no plans to suspend business activities in Russia.

A company spokesperson told us that this is Believe’s strategy “at the moment”, but added that the company is “monitoring the situation very closely”.

The news said in an official statement: “We are monitoring the situation very closely as it is evolving constantly. Our top priority was to ensure the safety of our teams and their families in the region, and we immediately made a donation to help the people of Ukraine. Second, we worked with our teams to align our operations with global sanctions.”

According to Believe’s first half of 2021 results, as of September last year, the company employed 1,370 employees globally.

In addition to the Headquarters in Paris, Believe said in Apply for the first half of 2021 that “its main subsidiaries are located in Canada, China, France, Germany, India, Italy, Japan, Luxembourg, Russia, Singapore, Turkey, the United Kingdom and the United States”.


It is particularly interesting to see Kobalt clearly demonstrate his support for “any decision that would remove the local Russian collection organization, the RAO, from the network of collectors associations”.

To date, the umbrella group for music publishing collections associations – CISAC – Yes Not suspended RAO from its global membership network, despite calls to do so from high-profile figures in the music publishing industry.

Due to CISAC’s refusal to suspend RAO, UK PRS for music take unilateral action earlier this week, announced that it was “formally suspending, with immediate effect, our agency relationship with the RAO, the Russian collection of musical works, pending confirmation. separation from the Russian Government and the individuals and companies on the sanctions list”.

“I can’t believe CISAC can’t get rid of the RAO… it’s really mythical at this point.”

US Senior Publication Personality

PRS added: “We are also working with CISAC to consider the continued membership of Russian societies in the global network.”

A senior leader of the US music publishing market told us Monday: “I can’t believe this has to be done unilaterally. [by PRS] and CISAC can’t get rid of the RAO… it’s really a myth at this point. ”

(BMIThe company, which has an international reciprocal collection agreement with PRS, has also confirmed that it is severing ties with the RAO.)


CISAC announced on wednesday (March 9) that it was launched a support fund dedicated to helping the victims of the war in Ukraine – but again stopped at the suspension of the RAO.

The Fund was approved by the CISAC Council.

The agency said it was the first step in a broader initiative called “Creators for Ukraineit aims to “unite the global creative community to support creators and refugees forced to leave the country”.Worldwide music business

https://www.musicbusinessworldwide.com/kobalt-and-downtown-cut-ties-with-russia-believe-continues-to-operate-in-market-but-is-monitoring-the-situation-very-closely/ Kobalt and Downtown cut ties with Russia; News continues to be active in the market but is ‘monitoring the situation very closely’

Fry Electronics Team

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