Data and legal issues in the music industry
By Andy Blair
Music is deeply emotional and cultural. Formative moments in our lives are often inextricably linked to a song that captures our feelings of joy, love, heartbreak, or loss. While those emotional connections with music and artists remain core to the music industry, the business of music increasingly depends on something a bit less romantic: data.
Industries everywhere rely heavily on data and music is no exception. With the rise of the Internet, social media, and digital content distribution, data has redefined how the music industry works. Data links music to the talented songwriters, performers, and producers who contribute to its creation. Data helps labels, managers, and tour planners understand how and where music is being consumed. Data helps artists build rich relationships with fans and communicate new releases, shows, and merch.
Let’s take a short magical mystery tour through these examples and some of the data-related issues that lawyers in the music industry confront every day. To help us on our journey we’ve enlisted the help of the hot new (fictional) Minnesota band Is It Spring Yet?—or IISY—through the creation, distribution, and promotion of their debut album Nope, Still Cold.
Content Data and Metadata
Our first stop on the tour is content data and metadata. These measures capture who wrote, performed, and produced a recording, as well as who owns the right to collect royalties. Without this data, digital revenue generated from music might never reach its creators. Content data and metadata is used by streaming and social media platforms, labels, and copyright collection societies to collect and distribute royalties to labels, creators, and other rightsholders.
A key part of Is It Spring Yet’s album creation process is working with their label to assign unique identifiers to their recordings (an International Standard Recording Code or ISRC) and compositions (an International Standard Work Code or ISWC) and to attach those identifiers to the metadata of their tracks before distribution. The band and label also ensure that the band, band members, writers, and producers all have unique personal identifiers, known as ISNIs, to help attribute credits and royalties correctly. Accurately capturing this data may sound simple on its face but can be difficult in a creative industry with no historic “source of truth” for such data. Adding to the complexity, major hits can spawn dozens of variants including remixes, mashups, covers, lyric videos, and more, each of which may have different contributing writers, producers, performers, and royalty splits.
In addition to metadata, data related to licensing and assignment agreements must be tracked over time to continue paying royalties correctly as rights are licensed or sold. With the life of copyright lasting decades, collecting and maintaining content data and metadata is a challenging but critical long-term effort.
What part do lawyers play here? Lawyers draft agreements among bandmates and with labels and publishers that cover recording and songwriting rights, royalties, and administration. Counsel may be needed to assist in audits, recovering unpaid royalties, or resolving disputes related to royalty splits, which in some cases are driven by bad data more than bad faith. Because these creators are also people, data collection can trigger privacy issues as personal information about those people is collected, used, and shared throughout the music rights ecosystem.
Content data and metadata management is one of the most important issues in the music industry. While the nature of artistry has always made music creation a bit messy, the ongoing democratization of music production and distribution through technology compounds data challenges facing artists, rightsholders, and content platforms has only increased. Lawyers have a key role in the industry-wide tools and legal frameworks that facilitate accurate data collection and use.
Distribution and Consumption Data
After weeks in the studio, IISY is ready to release their album, just in time for another Minnesota winter. Once the album is out, IISY and their label turn their attention to data about where and how fans are listening. The band uses dashboards and data provided by streaming and social media platforms to see how many times their tracks—typically organized by ISRC and ISWC—have been streamed, as well as details such as listener geography, repeat listeners, playlist inclusion, and more. They also review data about digital downloads, retail sales, and user-generated content as well as merch sales on their official store.
The early results for IISY are amazing! Their album has millions of streams in its first week and the hit track “Saunas and Glögg” has inspired viral TikToks connecting IISY to millions of new fans. The data behind these streams and social engagement is central to determining royalty payments, but that’s not all it is used for. Billboard uses consumption data for its weekly rankings of most popular songs, IISY’s managers use data about where their fans are to plan stops in their upcoming tour, and IISY’s label uses social and streaming data for marketing strategy.
Consumption data also keeps music industry lawyers busy. Negotiations over commercial and privacy issues related to data access, ownership, audits, and use limitations are ever-present in licensing deals. Streaming fraud and piracy also continue to drain revenue from legitimate rightsholders as barriers to music creation and distribution have fallen.
Fan Data
The final stop on our tour is all about the fans. As IISY knows, bands often need more than just great music to build a successful career. To capitalize on their album’s success, IISY captures fan data they can use to sustain and grow fan relationships through their tour, merch, and future album cycles. This data includes email and SMS direct marketing subscriptions, online advertising data from their websites and ecommerce store, and audiences on social media platforms. Increasingly, artists collect these kinds of fan activity into profiles that help identify superfans and personalize online experiences.
To keep fans engaged, IISY’s label and management teams post regularly to the band’s social media accounts and send periodic direct marketing updates to keep fans engaged on new releases, tour updates, and merch. Email and SMS messages are personalized to promote local shows and merch to increase fan engagement and revenue. Similarly, online advertisements are targeted geographically and demographically to optimize return on advertising spend.
Legal issues related to fan data primarily involve data privacy, security, and promotional law. US privacy laws recently passed in more than a dozen states increase compliance obligations such as transparency, choice, and data sharing limits. The FTC and class action plaintiffs have also increased their activity related to online tracking compliance. Navigating these risks in a complex ecosystem with widely varying levels of legal sophistication is a growing challenge for music industry lawyers.
These are just a few of the many areas where data has become essential in the music industry, and where legal issues have grown in parallel. This trend will almost certainly persist as AI and other emerging technologies create new opportunities and risks. In an industry still adapting to more than two decades of continuous technological disruption, there is no end to data-related change, or legal issues, in sight.
Andy Blair is Chief Privacy Officer at Universal Music Group, where he has led the company’s global data, privacy, and cybersecurity legal function for more than eight years. Andy and his team advise UMG’s business units around the world on data-related compliance, AI, contract, incident response, investigation, litigation, audit, M&A, and public policy issues. He leverages his Computer Science degree and deep understanding of technology to help UMG navigate complex business and legal challenges.