SoundExchange

Major and Indie Labels Will Be Paid The Same Webcasting Rates… For Now

Independent labels and artists had something extra to be thankful for this Thanksgiving.

In a November 25, 2015 ruling, the U.S. Copyright Office made it clear that webcasting royalty rates for the period covering 2016-2020 would treat major and independent record labels the same, as has been the case since the the establishment of a public performance right for digital transmission of sound recordings. Last week’s decision, handed down by Register of Copyrights Maria Pallante, is a response to the Copyright Royalty Board’s (CRB) question about whether the federal statute that provides for rate-setting (17 U.S. Code § 114) would permit different rates for majors and indies.

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CD Baby Begins Collecting Label Share of Digital Performance Royalties

When music is played on a non-interactive digital service like Pandora, Sirius XM, or cable radio, payment for the sound recording copyright is collected and distributed by SoundExchange, a non-profit performance rights organization. As we detail in our handy “Music and How the Money Flows” chart, this revenue is divided up in a standard formula: 45% goes to the featured artist, 50% goes to the sound recording copyright owner (usually a label), and 5% goes to the AFM/SAG-AFTRA Intellectual Property Rights Distrbution Fund, for distribution to backing players, session musicians, and backing vocalists.  We’re fond of this system because it treats all artists equally, ensuring direct payment that can’t be held against recoupable debt to a label, with equitable splits.

But what happens if you’re a self-released artist who doesn’t work with a label, but owns the copyrights to your sound recordings? You are entitled to collect both the artist share and the label share yourself.  Unfortunately, many artists don’t know this, and end up missing out on money they ought to be collecting, because they’ve only registered for the artist share.  Other artists haven’t registered with SoundExchange at all.

CD Baby,  a popular distribution service with a large userbase of mostly self-released artists, recently announced a change to their terms of service that allows them to collect the label share from SoundExchange for their roster of distributed artists. This move was met with some minor controversy, as indeed, artists are entitled to collect that money themselves directly from SoundExchange, without the administrative cut that CD Baby charges.  We decided to go directly to the source: CD Baby CEO Tracy Maddux answered our questions this week via email.

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Copyright Hearing Recap: Music Licensing Pt. 2

by Juan Carlos Melendez-Torres, FMC Policy Intern

The House Judiciary Subcommittee on Courts, Intellectual Property and the Internet held its second hearing on music licensing on June 25, welcoming input from a variety of interest groups and organizations as a continuation of the ongoing reexamination of our country’s copyright system.  You can find our coverage of the prior hearing here

Nine witnesses testified before the committee, offering opinions that varied in focus but all highlighted major areas of potential reform. Witnesses for this hearing included singer/songwriter Rosanne Cash representing the Americana Music Association, Cary Sherman (CEO of the Recording Industry Association of America, or RIAA), Charles Warfield on behalf of the National Association of Broadcasters (NAB), Darius Van Arman on behalf of the American Association of Independent Music (A2IM), Ed Christian of the Radio Music License Committee (RMLC), Paul Williams as President of the American Society of Composers, Authors and Publishers (ASCAP), Chris Harrison of Pandora, President of SoundExchange Michael Huppe, and David Frear, CFO of Sirius XM

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The Quest for Royalties for the Use of Sound Recordings on AM/FM Radio: In Full Swing

Guest post by Owen J. Sloane (@osloane) and Rachel M. Stilwell (@rachelmstilwell)

As nearly two hundred artists, producers, engineers, and music professionals traveled to Washington DC for “GRAMMYs On The Hill” last week, now is a great time to review the status of an important and recurring issue facing recording artists. Artists and record labels, large and small, do not get compensated for the use of their recordings on AM/FM (“terrestrial”) radio. The recording industry would like to see a change in this area, so that working musicians (not just the superstars) can make a fair living making recordings that we as fans want to hear on our local radio stations. It costs money, time, as well as talent, to create great records.

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