Copyright Royalty Board Awards 15.1% Streaming Royalties In Songwriter, Publisher Boon

NMPA's David Israelite: Remaining Vigilant (Photo: LinkedIn)

THE COPYRIGHT ROYALTY BOARD last week increased the percentage songwriters and publishers make on streaming services like SPOTIFY and AMAZON MUSIC from 10.5% to 15.1% between the years 2018 and 2022, the largest such increase in the organization's history..The rates will gradually rise year to year before approaching the latter figure for 2022.

The BOARD had previously announced in JANUARY 2018 its intention to raise songwriter/ publisher royalty rates for streaming and other mechanical uses. That led SPOTIFY, AMAZON and GOOGLE -- but not APPLE -- to launch a legal appeal against the new rates, which was turned down by the BOARD with its announcement last week.

NATIONAL MUSIC PUBLISHERS ASSOCIATION CEO/President DAVID ISRAELITE commented,  “[This] reaffirmation confirms that songwriters need and deserve a significant raise from the digital streaming services who profit from their work.”

When the streaming services issued their appeal after the 2018 announcement, the CRB did ultimately agree to put a cap on the 26.2% "Total Contents Costs" (TCC) for songwriters and publishers, somewhat limiting the previously "unlimited" payout figures. The BOARD's definition of "streaming bundles" -- family plans, telephone company deals and other promotional discounts -- now also favors the streamers. 

Added NMPA's ISRAELITE: “We will fight to increase the TCC, or percentage of label revenue, which amounts to an insurance policy for songwriters, in the next CRB and will also fight for stronger terms regarding bundles.

“This process was protracted and expensive and though we are relieved with the outcome, years of litigation to uphold a rate increase we spent years fighting for is a broken system," he continued.

“Now, songwriters and music publishers finally can be made whole and receive the rightful royalty rates from streaming services that they should’ve been paid years ago. We will work to ensure that the services quickly backpay copyright owners as they are required by law. As an industry, we move forward united as we press for even fairer rates in the next CRB starting this fall.”

With the new 15.1%, streaming services will be handing over a nice-sized payday to publishers and songwriters covering the last five years. 

Representing the streaming services, DIGITAL MEDIA ASSOCIATION President/CEO GARRETT LEVIN commented,“The streaming services thank the Judges for their efforts. Today’s decision reflects a significant increase in the royalties that will be paid to publishers. The work to give effect to these new rates will soon begin in earnest. The streaming services are committed to working with the MLC and music publishing companies to facilitate the accurate distribution of royalties.”

“This proceeding is also a reminder that rate settings do not – and cannot – take place in a vacuum. Today’s decision comes as the three major label groups – which operate the world’s three largest music publishers – continue to earn the lion’s share of the industry profits while reporting consistent double-digit revenue growth as a result of streaming.

“Looking ahead, streaming services believe it’s time for all stakeholders—labels, publishers, writers, artists and the services—to engage in comprehensive discussions to figure out the right royalty-sharing balance going forward.”

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