Spotify Inks Direct Licensing Deal With Kobalt, Following Similar Pacts With UMPG and WCM

Spotify has struck a new direct licensing agreement with Kobalt. The news follows about six months after the streaming service struck agreements with other top publishers — Universal Music Publishing Group and Warner Chappell — both of which reported at the time that their deals with Spotify improved remuneration for songwriters on the platform.

Details of the deal remain limited, but a source familiar with the matter says it positions Kobalt to earn beyond the baseline mechanical royalties set by the U.S. Copyright Royalty Board. Kobalt’s CEO, Laurent Hubert, calls the company’s direct deal with Spotify a “step in the right direction” which “reaffirms our unwavering commitment to ensuring our songwriters are paid fairly for their work, and underscores the importance of progressive licensing models that reflect the real-world use of music across digital platforms.”

Spotify has had strained relations with music publishers and songwriters at different points throughout its history, due to royalty rate disputes, but tensions intensified in March 2024 when Spotify began paying a significantly lessened royalty rate for streams on its premium tiers to songwriters and publishers. This occurred as a result of Spotify reclassifying those tiers as “bundles,” a type of plan that qualifies for a discounted rate on U.S. mechanical royalties given that multiple products — in this case, Spotify’s music and newly added audiobooks — are both offered under one price tag.

At the time, Billboard estimated that this change will lead songwriters and publishers to earn about $150 million less in royalties for the first year bundling is in effect, compared to what was projected pre-bundling. More recently, at the National Music Publishers’ Association’s (NMPA) annual meeting in June 2025, the trade organization representing UMPG, WCM, Kobalt and the vast majority of other publishers reported that the bundle actually led to a loss of $230 million in the first year.

While the NMPA has lead a broad campaign against Spotify’s bundling practices since March 2024, by January 2025, several major players in the music publishing industry had begun exploring private deals with the streaming platform. UMG announced a recording and publishing deal with Spotify first — becoming the first direct deal between Spotify and a publisher since the passage of the Music Modernization Act in 2018. The deal impacted both UMG’s recorded music and publishing royalty rates and included language about protection for UMG talent through Spotify’s fraud detection and enforcement systems.

A Spotify spokesperson told Billboard at the time: “Spotify maintains its bundle, but with this direct deal, it has evolved to account for broader rights, including a different economic treatment for music and non-music content.”

WCM followed shortly after, while Kobalt is the third to follow suit. A press release about Spotify’s Kobalt deal says it will “deliver greater flexibility, efficiency, value, and protections to songwriters in the US.”

Still, Spotify has yet to strike a similar deal with Sony Music Publishing, the largest publisher in the world. A source close to Spotify reveals that while they are having positive discussions with them, there is no deal to date.

“This deal reflects the collaborative efforts between Kobalt and Spotify in building a licensing framework to enable new formats, innovations, and potential to connect creators and fans alike. The deal also reflects a broader shift toward licensing structures that allow songwriters to participate more directly in the value their work creates on streaming platforms,” the press release continues.

While Spotify works to secure direct licenses with music publishers, the company is also working to roll out new features, many of which require the music publishers’ cooperation to go through. According to the Wall Street Journal, Spotify is working on a “remix” feature to speed up, mash up and otherwise edit sound recordings. It is also working on licensing music videos in countries around the world — both of which are expected to be part of Spotify’s teased ultra-premium tier. As the NMPA warned Spotify in a cease and desist letter to the streamer last year, “any such feature … without the proper licenses in place from our members… may constitute additional direct infringement,” serving as a warning shot to the streamer.  

“We’ve always believed that better partnerships lead to better outcomes,” says Alex Norström, co-president & Chief Business Officer, Spotify. “This agreement with Kobalt boosts our support of songwriters through a licensing model that unlocks new growth and will expand the way music is made and shared today.”

Kobalt’s Hubert, adds: “As the largest independent music publisher dedicated to fighting for the rights of songwriters, this deal reaffirms our unwavering commitment to ensuring our songwriters are paid fairly for their work, and underscores the importance of progressive licensing models that reflect the real-world use of music across digital platforms. This partnership is a step in the right direction, and we look forward to continuing to work with Spotify to increase the value of songwriter royalties.”