Songwriters to Start Getting a Lot More Money From Streaming Services

“This is the best mechanical rate scenario for songwriters in US history.”

Music
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The Copyright Royalty Board (CRB) has announced that songwriters will get a pay raise from streaming services for the next five years. Variety reports, songwriters’ rate jumps from 10.5 percent of revenue to 15.1 percent, a 43.8 percent increase — the largest such increase in CRB history. The pay raise is a result of a debate between the National Music Publishers’ Association (NMPA) and the music streaming services run by Apple, Google, Spotify, Amazon, and Pandora. There will also be a late fee charge to streaming services that are behind with their payment to publishers and songwriters.

“We are thrilled the CRB raised rates for songwriters by 43.8% – the biggest rate increase granted in CRB history,” NMPA CEO David Israelite said in a statement. “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.”

Even though this is a great step forward in terms of fair compensation, labels, however, are still paid more than songwriters and publishers; for every $3.82 USD to the label, writers/publishers get just $1 USD. Israelite acknowledges that there is still much room for improvement, but adds, “This is the best mechanical rate scenario for songwriters in US history which is critically important as interactive streaming continues to dominate the market.”

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