{"id":97771,"date":"2023-12-18T18:00:00","date_gmt":"2023-12-18T18:00:00","guid":{"rendered":"https:\/\/routenote.com\/blog\/?p=97771"},"modified":"2023-12-18T17:18:34","modified_gmt":"2023-12-18T17:18:34","slug":"french-governments-music-streaming-tax-controversy","status":"publish","type":"post","link":"https:\/\/routenote.com\/blog\/french-governments-music-streaming-tax-controversy\/","title":{"rendered":"French government’s proposed music streaming tax sparks controversy among streaming services"},"content":{"rendered":"\n

The French government’s proposal to levy a tax on music streaming services has sparked controversy, with Spotify and Deezer expressing strong opposition.<\/span><\/h2>\n\n\n\n

Confirmed by President Emmanuel Macron, France’s new streaming tax, aims to fund the Centre National de la Musique (CNM)<\/a><\/strong><\/span>.<\/p>\n\n\n\n

As reported by Music Ally<\/a><\/strong><\/span>, Spotify’s Director General in France, Antoine Monin, has labelled the tax a “monumental strategic error” and warned that it could lead to the company deprioritizing France and therefore be detrimental to innovation and investment. <\/p>\n\n\n\n

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France proposes a new tax for music streaming companies<\/strong><\/h3>\n\n\n\n

Set at 1.75% on the revenue of streaming apps, the tax has faced criticism for potentially disadvantaging European platforms compared to their US counterparts. However, the specific terms of the tax are yet to be revealed by the Ministry of Culture.<\/p>\n\n\n\n

The controversy nevertheless arises as the tax is expected to have a disproportionate impact on European streaming companies, Spotify (Sweden) and Deezer (France) in particular due to their dominance in the French market. <\/p>\n\n\n\n

After gaining The Senate’s approval, France’s proposed streaming tax has been met with opposition from major streaming services. Spotify’s Monin has highlighted the potential repercussions by stating that while the company could absorb the tax, it might result in disinvestment in France and prioritizing other markets.<\/p>\n\n\n\n

Meanwhile, Deezer CEO Jeronimo Folgueira has expressed disappointment and labelled the tax the “worst possible outcome” that could negatively impact France’s music industry. <\/p>\n\n\n\n

Ultimately, the proposed flat-rate tax for all streaming companies is viewed as potentially harming independent European music streaming companies while American tech giants can continue as they are. The outcome is not yet certain, but the tax could lead to services creating measures that “safeguard” their business which may impact support for French artists and lead to lower rates of music consumption in the country.<\/p>\n\n\n\n

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What is the CNM?<\/strong><\/h3>\n\n\n\n

The controversy has added to the ongoing debate about how to best fund the CNM which is designed to support stakeholders in the music sector. <\/p>\n\n\n\n

Spotify, Apple, Deezer, and other major streaming platforms had announced a voluntary agreement to contribute \u20ac14 million to the CNM in 2025 as an alternative to the government’s tax plan. <\/p>\n\n\n\n

However, the French government’s push for the tax is seen as an attempt to address the perceived lag in the country’s streaming market compared to other Western nations. <\/p>\n\n\n\n

France currently ranks as the sixth-largest recorded music market globally, with \u20ac920 million in revenue from recorded music in 2022 compared to the USA’s $15.1 billion in 2016.<\/p>\n\n\n\n

The disagreement between the French government and streaming companies has highlighted the challenges of finding a balance between supporting cultural initiatives and fostering a competitive environment for streaming platforms by showing potential far-reaching consequences on the industry landscape.<\/p>\n\n\n\n

What do you think? Do you think streaming sites are right to object to the French government’s music streaming tax? Let us know in the comments! <\/p>\n\n\n\n

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YouTube TV is getting more like TV, with adverts<\/a><\/blockquote>