There is a tech maxim that says the road to 21st century progress isn’t paved with asphalt, but with fiber optic cables and data centers. If that’s true, The Music Infrastructure Company (MusicInfra) is aiming to be the road crew bringing progress to royalty collections.
Founded in 2023, MusicInfra is an independent business-to-business music technology and rights management company that provides modular tech infrastructure, like data processing, rights-matching engines and royalty clearinghouse services, to digital streaming platforms and rights-holders.
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Its backers include Raine Group, UTA Ventures, and Peter Thiel’s Snö Ventures, and starting this week MusicInfra is the rights management support provider for Amazon Music on music used in videos, a connection that opens the door to working with any of the National Music Publishers’ Association’s (NMPA) roughly 800 members.
Landing Amazon as a client presents more than just a step-change in scale for MusicInfra. MusicInfra co-founder and CEO Björn Lindvall says, “We’ve reached this kind of inflection point where both publishers and the platform are actually trusting us to do something.”
Billboard sat down with Lindvall to talk about what it’s like to land a contract with one of the largest music streaming companies at one of the world’s biggest tech companies, and how the music industry is warming to MusicInfra’s idea of a worldwide clearinghouse for music rights.
I asked Claude for an analogy to describe what MusicInfra does for clients like Amazon Music, and it said MusicInfra is like Plaid/AWS/Shopify. It provides universal financial plumbing like Plaid, scalable, customizable tech in the background like AWS and inventory tracking and a cashier like Shopify. Do you agree with that?
Björn Lindvall: I haven’t heard that before, but I don’t disagree. We basically do four things. [First] We match this whole thing, and then we give Amazon a bucket of songs that are clear to use. Second, these songs are consumed on Amazon in one way or the other and then our deal engine [determines] how much are you getting paid per video? How much are you getting paid per stream? Whatever it is we send reports back to publishers and back to the platform, and then we pay people. Those are basically the four steps.
Does bringing on a partner the size of Amazon help you scale MusicInfra’s tech stack? What challenges did you encounter?
Lindvall: Yes. Standing up a machine of the size that is required for Amazon … a 15-person team cannot do that manually. It all has to be built with repeatable processes and data. For instance, Amazon wants clearance information on what videos they can and cannot use every 24 hours. So we run that every 24 hours. It takes us on average 28 minutes to do the clearance. Previously, people have turned this around in a month. [The expedited timeline] enables our clients to increase their revenue by putting more music live on their platforms faster and, at the same time, stay compliant with their licensing agreements and pay rights-holders correctly and on time.
More people in the music industry these days are complaining about the same core problem that inspired you to start MusicInfra. For example, Robert Kyncl, CEO of Warner Music Group, has said he would prefer to collect publishing royalties directly.
Lindvall: Yes, I think infrastructure is now something that people take very seriously. When the growth of the music market in general is sitting at 5-7% growth per annum, rather than [double-digit percentage growth annually], which was the case five years ago, how do you increase your operational leverage to make more money? You must have the infrastructure layer working, and up until now it has not been working. It’s been controlled by a whole heap of middlemen with bad tech, bad processes and suboptimal relationships. [Rights-holders] have got all these billions worth of catalog, [and they] probably want to control how [they] actually get paid for this stuff. [Music companies] are taking — for the first time ever, as far as I know — a very radical new look at how things should be. I think there are some big changes are coming.
You’ve said before that the ultimate goal with MusicInfra is to create an international clearinghouse. Does gaining Amazon Music as a client bring that goal closer?
Lindvall: One hundred percent because we have effectively two sets of stakeholders through clients. One is the platforms. The other are rights holders/publishers. In winning one client like Amazon, everyone who wants to do anything from Amazon has to work with [MusicInfra]. Since we have the catalog, the tax information and the payment information, we can then over time roll out services to [additional publishers they start working with as a result of the Amazon contract] and that’s where you wind up in that ultimate place. You have one tech stack servicing the licensees, the users of music and the rights holders. That is the definition of the clearing house.
Your dream is … being rolled out?
Lindvall: Most people told me I was crazy trying to do something like this, and there are many miles left to go. But having the Amazon team choosing us is an enormous endorsement because the entire music industry obviously knows that they know what they’re doing, and the bar for working with Amazon is very high. In order to win a big contract like that, you … basically [must win the] approval of the [biggest] publishers, including all of the majors.