Napster Dogged By Reports of Late Royalty Payments

Photo Credit: Ashley King

A new report suggests Napster is behind on royalty payments to major distributors and record labels. Some say Napster is a few months behind schedule; others say they’re behind more than a year.

A new report from Billboard suggests the now-legal streaming service isn’t making royalty payments to distributors and record labels. “For years, they have cited fundraising struggles as an excuse for delayed royalty payments,” one executive at a distributor told Billboard anonymously. When asked for a comment on the report, Napster CEO Jon Vlassopulos declined to comment.

Napster is a small-time player in the world of music streaming. Rights holders who spoke to Billboard confirmed the payments received in the past from the digital service provider (DSP) have accounted for less than 1% of their overall streaming income. “What we earn from it as a distributor isn’t that much, but in terms of payouts to the artists and the labels who we represent, it can be a solid sum of money,” said another executive.

The current iteration of Napster was bought by Rhapsody and transformed from a pirate download service into a music streaming service. Rhapsody rebranded itself under the Napster name in 2016. Then in 2020, the virtual reality concert app MelodyVR purchased Napster for $70 million. In 2022, the company changed hands yet again with Hivemind Capital Partners and cryptocurrency Algorand becoming the new owners.

Napster CEO John Vlassopulos was brought in the same year after serving as the Head of Music at Roblox. As rights holders say they are struggling to get paid, they’re considering removing their catalogs from Napster or refusing to deliver new releases to the DSPs. The only other option is litigation for missed royalty payments, but those costs would eat into any sum recovered.

“Not only have they failed to pay royalties, but they have also been unresponsive when we’ve attempted to resolve these matters,” another executive speaking with Billboard confirmed.

Link to the source article – https://www.digitalmusicnews.com/2025/01/21/napster-dogged-by-reports-of-late-royalty-payments/

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