The US music licensing organization SoundExchange just acquired a Canadian music publishing rights company called Canadian Musical Reproduction Rights Agency Ltd. The Canadian company deals with mechanical rights in Canada and the move by SoundExchange is seen as the first into the publishing rights world.
The Canadian company won’t come under the brand of SoundExchange and both organizations are thought to continue running separately. Behind the scenes, however, there is much deeper collaboration expected.
SoundExchange paid out almost a billion dollars in digital royalties in 2016, which was up 10% from the previous year. However, there were some threats the company faced and may be why they moved to purchase CMRRA.
The organization has been thriving in recent years, but its business model faces some undeniable threats: SoundExchange’s biggest source of revenues, Pandora, is failing to grow its listener base – and recently inked direct licensing deals for the first time to cover its new three-tiered streaming product.