An uphill legal dispute with music streaming services has finally come to a head, marking an unprecedented victory for songwriters. The federal Copyright Royalty Board headed the push for increased royalty rates from digital streaming and won a nearly 50% increase. Streaming giants including Apple Music and Spotify must now pay songwriters 15.1% of their revenue–a massive increase from the original 10.5%.
The federal Copyright Royalty Board won a streaming royalty rate increase for the nation’s songwriters, up 43.8% from the original standard.
Coinciding with federal legislation known as the Music Modernization act, National Music Publishers Association CEO David Israelite has called last weekend’s happenings “the most exciting 24 hours for songwriters” in years.
The Music Modernization Act would ultimately reform the current digital mechanical licensing process to increase royalty rates for songwriters and publishers. Coupled with the CRB’s recent victory, songwriters would perhaps finally see compensation commensurate with their streaming numbers. The CRB also managed to lift a cap which limited how much total revenue streaming companies must pay for their licenses.
While artists and record labels are able to negotiate their own deals with streaming services, songwriters are beholden to federal regulations setting their royalty rates. The increase from 10.5% to 15.1% will undoubtedly spark a massive boost in songwriters’ earnings.
Additionally, the CRB managed to implement a late fee–the first ever of its kind–for any royalties not paid on time.
The fee, which could be as much as 18% annually, is yet another milestone revolutionizing the way songwriters are compensated in the streaming era.
Overall, the CRB’s new legislation and the Music Modernization Act are favored by both songwriters and streaming providers. The Music Modernization Act would create a purchasable blanket license for streaming companies, putting the responsibility of copyright identification on another organization. This would eliminate streaming companies’ legal liability which has, in the past, resulted in lawsuits from songwriters whose work was not properly licensed by such services.
The uncertain world of streaming royalties has gotten much more stable thanks to the Copyright Royalty Board’s push for reform.
Source: Tennessean