Deezer exploring user-centric licensing model with labels

MIDiA Research Managing Director Mark Mulligan, a celebrated industry writer in the UK who unpacks big issues on his blog, claims Deezer is changing its mode of music licensing.

According to his report, Deezer is exploring ‘user-centric’ licensing that ditches the model of paying royalties based on the entire pool of monthly listening and instead pays based on each individual user’s listening habits.

Mulligan explained it like this: “If a subscriber listens 100% to Metallica, Metallica gets 100% of the royalty revenue generated by that subscriber.”

This is vastly different to the existing model. Currently, if a listener listens exclusively to deathcore but music from an artist like Drake accounted for 10% of all streams in a month, then 10% of that deathcore fan’s subscription fee goes towards the rightsholders tied to Drake’s music.

Mulligan reported Deezer is exploring the ‘user-centric’ licensing model with record labels.

“The general consensus among labels I have spoken to is cautious optimism and a willingness to run the models and see how things look,” he wrote.

The proposed licensing model would certainly be a more transparent way of licensing – something many rightsholders have been pushing for since the dawn of streaming.

More than that, it could give the local market a reason to switch to using Deezer as a preferred streaming platform. Deezer shut its Sydney office in 2014, pulling out of its Australia and New Zealand presence. A year later its local boss Thomas Heymann joined Pandora.

The French-based platform services Australia and New Zealand out of Singapore, however, it’s struggled to rise to its challenger giants in Spotify and Apple Music.

This article originally appeared on The Industry Observer, which is now part of The Music Network.