Cheating on geographies
Licensing is complicated. Copyright laws were written way before the advent of digital technology. There are also several different copyrights, all represented by different entities in different countries. It's a difficult area to navigate for both start-up DSPs and established players.
That being said, there's no excuse for not being licensed. If you want to use music as part of your business, get a license. Also, the obligation to license is on you, no one else. It’s that simple.
We’re shocked to learn that many of our competitors have a local, national PRO license but then use that license internationally. What this means is that an in-store music provider starts in a local market, for example Belgium, and gets Belgian customers. But, soon enough the in-store music provider gets a request from an international customer who also has stores in the Netherlands. This is when things go wrong. Rather than buying Dutch licenses, the company uses its Belgian, local license as if it were an international one. More markets can get added and soon enough you've taken a Belgian license and built an international customer base across the world, in multiple continents.
Let’s be clear and address what is so wrong with this picture:
Some musical works may have different owners in different territories. Playing a song in country A but reporting it as coming from country B may cause revenues going to the wrong rights holder.
Data is king in the new music industry. Data quality matters. Many creators rely on data to drive their insights. In what markets do I have traction? Where does my stream come from? Where should I invest in touring and promotion? With streams showing up from the wrong places, rights holders are robbed of their ability to obtain data insights and are at risk of taking the wrong business decisions.
Rates and competitive fairness. How can you be sure that the Belgian rates are what other CMOs are charging in other territories? What if the Belgian rates are substantially lower than in the Netherlands? That would mean that the Belgian in-store music provider has an unfair market advantage over Dutch in-store music providers. This is uncompetitive and illegal.