Sony Music settles with US publishers following streaming rates spat

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Sony Music Entertainment has signed a deal with US publishers which resolves issues – and quells bad blood – over proposed new statutory mechanical royalty rates from 2018-2022.

The National Music Publishers’ Association (NMPA), the Nashville Songwriters Association International (NSAI) and Sony Music Entertainment (SME) have filed a joint agreement with the Copyright Royalty Board (CRB) concerning the ongoing rate proceedings for mechanical royalties payable under Section 115 of the Copyright Act for the period between 2018 and 2022.

Similar to NMPA’s previously announced settlement with record labels Warner Music Group and Universal Music Group, the agreement includes a roll-forward of rates covering physical products, digital downloads, and ringtones.

Most importantly, SME has agreed to will withdraw its input from the section of the proceedings regarding on-demand streams. Additional terms were not disclosed.

Sony’s participation in the on-demand stream rate consideration has caused consternation amongst publishers, with the major being accused of following a label-led agenda to reduce songwriters’ potential share of streaming payouts.

“Sony Music and the music publishing community value their relationship.”

Joint statement

David Israelite, CEO of the NMPA (pictured), previously accused Sony of “fighting on the side of digital music companies to try to further reduce what little income [songwriters] receive from on-demand streaming”.

He was backed up by the NSAI, who wrote in a stinging open letter to Doug Morris: “It appears that Sony does not value the contribution from, nor the relationship with, songwriters as much as other record labels.”

Thankfully, such disharmony is now behind the industry.

In a joint statement commenting on the deal, NMPA, NSAI and Sony Music said, “The parties are pleased to have reached a mutually beneficial settlement in this matter.

“Sony Music and the music publishing community value their relationship, and as the music marketplace continues to evolve it is more important than ever that the music community stands united to demand fair market pay for songwriters and artists from all digital music services.

“We look forward to working together to pursue that shared objective.”

Sony Corp is now the full owner of Sony/ATV Music Publishing as well as record company Sony Music, following a $750m deal with the Jackson Estate earlier this year.Music Business Worldwide

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  • hamillm

    As an independent musician, I have worked for 10 years to develop the skill I have to put together compelling music. I can say the the value proposition for me to put out music on digital services is simply not there. If my album streams 1 million times I will make less than $10k. If we look at cd sales, had the cost increased, would probably cost about $20 today. If each person who streamed an album had to pay $20 for that album and listened to it ten times. The album would have to sell 10k copies to reach 1 million plays. 10k times $20 is 200k. So if the industry were healthy an artist with an album capable of getting 1 million plays would have generated 200k, now it generates about 10k, is the scope of the problem not apparent in my example? If i sell it for $10 all I have to do is sell 1000 copies to match that 10k. I honestly would rather keep the music to myself than put it into a system which so very much is built on a long history of taking advantage of naive artists who are looking for a break after years of developing their craft. Looking for the next led zeppelin? Looking for the next stevie wonder? Well the type of artist who could become those have be altogether derailed by executives trying to meet a bottom line for share holders. In my opinion the last time there was a true rock star was kurt cobaine, which was right around the time the labels went public. Society is collectively getting what it pays for in terms of new music being released. So tech companies can laugh all the way to the bank and then cry when they have to listen to the same sound over and over.

    • Jay LeVert

      I am a Music Business Accountant, representing recording artists. You are 100% correct in your analysis. However the problem is that there is only the indy market as an alternative to the major labels and the digital distributors. There would have to be a complete music business paradigm shift in order to change the industry.

      • hamillm

        I like that tidal is artist run, perhaps more independent services of that nature could drive competition for art, but I can imagine the cost of setting up and running a streaming service is high and risky. But with the advance of AI, running a bunch of servers for music would probably get a lot cheaper, so maybe more services will pop up and drive spotify and others with big overheads out of business or to pay higher rates for streaming bc artists can get a better deal elsewhere, honestly i don’t know all the ins and outs. And why is the government setting streaming rates? Shouldn’t it be an open marketplace? The whole thing wreaks of corruption. In addition, There need to be bigger penalties for illegal downloading and sharing, plain and simple, I can’t walk into a grocery store and steal hundreds or thousands of dollars of food, and yet stealing that amount of musical ‘food’ it is relatively unpoliced. Significant fines and community service deter crimes, but i never hear about people getting caught, only the people behind torrent sites, is it policed at all? I for one am really disappointed because I want another stevie wonder, that would be awesome..