Streaming Services Will Now Have To Pay Songwriters An Extra 44%

In the music industry, making money can be a complicated process where selling an album doesn’t mean you as the artist gets to keep all of the profit. Barring differences in percentages, for the most part what happens when an album is bought is that a portion will go to the record label, and portion will go to the artist, and a portion will go to the publisher.

The publisher can sometimes represent the songwriter(s) of the album/song, which means when that this portion is split even further, resulting in the amount that songwriters getting being only but a fraction of the whole. However this will be changing over the next five years, as the Copyright Royalty Board (CRB) has announced (via Variety) a new ruling that will see streaming platforms pay songwriters an increase of 43.8% over the next five years.

While the boost in potential pay is great news for songwriters, it seems that this wasn’t exactly the deal that they wanted. Many have been pushing for a model which would pay them per stream of a song, which is how artists/record labels are being paid right now. This means that songwriters will be getting a direct stake in the success of a song, but we suppose this is a good place to start.

According to the President and CEO of the National Music Publishers’ Association David Israelite, “We are thrilled the CRB raised rates for songwriters by 43.8% – the biggest rate increase granted in CRB history. Crucially, the decision also allows songwriters to benefit from deals done by record labels in the free market. The ratio of what labels are paid by the services versus what publishers are paid has significantly improved, resulting in the most favorable balance in the history of the industry.”

Tyler Lee
Categories: Audio
Tags: Entertainment, Legal, Music