A federal judge has granted Spotify's request to extend its response deadline to July 19th in the Mechanical Licensing Collective (MLC) lawsuit over alleged royalty underpayments related to bundle pricing.

The extension moves the deadline from June 10th, giving Spotify approximately 50 days to prepare its response. According to Spotify's counsel, this additional time will allow the parties to communicate and potentially narrow the scope of issues in dispute.

The lawsuit centers on Spotify's recent bundle pricing strategy, which the MLC claims has resulted in significant mechanical royalty underpayments. Industry estimates suggest these underpayments could reach $150 million annually, or approximately $12.5 million monthly.

Spotify maintains its bundle pricing changes are legitimate, citing support from the National Music Publishers' Association (NMPA) and the Phonorecords IV determination, which specifically addresses bundle treatment and runs through 2027.

The dispute has drawn attention from other industry players, with Sony Music Publishing stating it's "considering all options" against Spotify. However, given Sony Music Entertainment's significant streaming revenue, a broader industry conflict appears unlikely.

This case holds significant implications for streaming platforms' bundle pricing strategies and mechanical royalty calculations in the music industry. The outcome could potentially influence future pricing models and royalty payment structures across streaming services.

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