There’s been a lot of talk about changing copyright laws that will also change the way royalties are paid out to parties involved in recorded music. A recent ruling by the Copyright Royalty Board has increased the royalties paid out to songwriters by 44%. The board also simplified the way in which songwriters get paid mechanical royalties for songs they wrote or contributed to.
However, with streaming royalty rates already so low, some are saying that though this is a step in the right direction, it shouldn’t be the end of the road for more fair compensation. Even with the 44% increase and simplification of the calculation process, it’s the copyright holders (not necessarily the songwriters) that receive the majority of the royalty payments.
Of course, there are two sides to every story. And though this increase will undoubtedly help songwriters a little more, it may be difficult for streaming companies to keep up.
According to Music3point0.com:
While paying out a larger portion of the income to songwriters won’t hurt the deep pocketed players like Amazon, Apple and Google, it will hurt smaller distributors like Tidal, Deezer, and even Spotify. Despite Spotify being the market leader with over 70 million paid subscribers, it’s still losing money, and actually lost over $500 last year alone.
The overall percentage paid to songwriters is going to increase to 15.1% over the next five years.