• Home
  • News
  • Fortune 500
  • Tech
  • Finance
  • Leadership
  • Lifestyle
  • Rankings
  • Multimedia
TechPointCloud

Spotify Buys Startup To Help It Track Musician Royalties

By
Jonathan Vanian
Jonathan Vanian
Down Arrow Button Icon
By
Jonathan Vanian
Jonathan Vanian
Down Arrow Button Icon
April 26, 2017, 8:13 PM ET
Inside The Offices Of Spotify Ltd. As IPO Rumoured For Music Streaming Company
A Spotify Ltd. logo sits on display as employees work at desktop computers inside the music streaming company's offices in Berlin, Germany, on Friday, June 17, 2016. According to reports, Spotify has hired Paul Vogel, the former equity research analyst at Barclays Plc, indicating that the music streaming company may be planning making an initial public offering. Photographer: Krisztian Bocsi/Bloomberg via Getty ImagesPhotograph by Krisztian Bocsi — Bloomberg via Getty Images

Spotify has acquired a startup to help it better manage royalty payments to musicians and song publishers.

The online-streaming music company said Wednesday that it had bought Mediachain Labs, a small Brooklyn-based company that specializes in so-called blockchain technology. Companies like shipping giant Maersk and UBS are all experimenting with securing and tracking digital payments by recording transactions across thousands of computers—an idea known as a distributed ledger—to minimize the risk of hacking or manipulation.

Spotify did not disclose how much it paid for Mediachain, but it’s likely to be small. Mediachain has less than 10 employees and has raised just $2 million from investors like Andreessen Horowitz and Union Square Ventures, according to deal-tracking site Crunchbase.

Get Data Sheet, Fortune’s technology newsletter.

Spotify said that Mediachain will help further its “journey towards a more fair, transparent and rewarding music industry for creators and rights owners.” Presumably, this means that Spotify plans to use Mediachain’s blockchain expertise to better manage music royalty payments for songs that it plays on its service.

Mediachain founder Jesse Walden wrote in a Medium post last year about how blockchain technology can be used in the music business to keep track of the owners of a song and how much they should be paid.

For more about technology and finance, watch:

Walden wrote that there is “is no good way” for people “to know the correct ownership percentages” of songs without blockchain technology. He also cited Spotify’s $30 million settlement with the National Music Publishers Association for allegedly failing to pay song royalties to publishers “because they didn’t know who to pay.”

About the Author
By Jonathan Vanian
LinkedIn iconTwitter icon

Jonathan Vanian is a former Fortune reporter. He covered business technology, cybersecurity, artificial intelligence, data privacy, and other topics.

See full bioRight Arrow Button Icon
Rankings
  • 100 Best Companies
  • Fortune 500
  • Global 500
  • Fortune 500 Europe
  • Most Powerful Women
  • Future 50
  • World’s Most Admired Companies
  • See All Rankings
Sections
  • Finance
  • Leadership
  • Success
  • Tech
  • Asia
  • Europe
  • Environment
  • Fortune Crypto
  • Health
  • Retail
  • Lifestyle
  • Politics
  • Newsletters
  • Magazine
  • Features
  • Commentary
  • Mpw
  • CEO Initiative
  • Conferences
  • Personal Finance
  • Education
Customer Support
  • Frequently Asked Questions
  • Customer Service Portal
  • Privacy Policy
  • Terms Of Use
  • Single Issues For Purchase
  • International Print
Commercial Services
  • Advertising
  • Fortune Brand Studio
  • Fortune Analytics
  • Fortune Conferences
  • Business Development
About Us
  • About Us
  • Editorial Calendar
  • Press Center
  • Work At Fortune
  • Diversity And Inclusion
  • Terms And Conditions
  • Site Map

© 2025 Fortune Media IP Limited. All Rights Reserved. Use of this site constitutes acceptance of our Terms of Use and Privacy Policy | CA Notice at Collection and Privacy Notice | Do Not Sell/Share My Personal Information
FORTUNE is a trademark of Fortune Media IP Limited, registered in the U.S. and other countries. FORTUNE may receive compensation for some links to products and services on this website. Offers may be subject to change without notice.