Rethinking Royalties in the Age of Streaming

When you press play on Spotify, it feels simple — a song streams, a few cents go somewhere, and the world keeps spinning. But beneath that effortless playback lies one of the strangest legal fictions in modern copyright: that every stream is somehow half a “performance” and half a “mechanical reproduction.”

The split traces back to industry convention, not statute. Congress never said a stream should count 50-50. The Music Modernization Act modernized licensing but didn’t bless that arithmetic. In truth, a Spotify stream is fleeting — data traveling through volatile memory, vanishing the moment you close the app. Nothing tangible, nothing fixed. Under the Copyright Act’s own definitions, that means no “reproduction” has occurred at all.

So why do we pretend otherwise? Because law and business rarely move in sync. The mechanical half of streaming royalties exists less by logic than by inertia — a relic of the CD era grafted onto a digital world that doesn’t make “copies” in any meaningful sense. If the law caught up with the technology, streaming would be treated almost entirely as a public performance right. Songwriters would actually benefit: performance royalties are paid directly to them, bypassing publisher recoupment and delay.

Maybe the deeper lesson is that legal frameworks often linger long after their technological moment has passed. Updating them isn’t just a matter of economics — it’s a matter of intellectual honesty. When we insist on fitting streaming into categories built for vinyl and cassette, we’re doing more than mislabeling bytes; we’re resisting progress.

The full article, “Is It Right to Ask Spotify to Pay Mechanical Royalties When No Copy of the Music Was Made?,” was originally selected for publication in the UCLA Journal of Law & Technology.