Writers Rejoice: Those Who Penned Your Favorite Tunes Get Bankroll Boost
This is something that has been a long time coming.
In the age of "sharing" music, new rules giving those who actually wrote or write the world's most cherished and beloved songs more revenue that they're rightfully entitled to is a positive for many listeners and those in the industry.
The new streaming rates, approved by Copyright Royalty Board on Jan. 27, represent a jump of 43.8 percent — an increase touted as "the biggest rate increase granted in CRB history" by David Israelite, president and CEO of the National Music Publishers Association.
"Crucially, the decision also allows songwriters to benefit from deals done by record labels in the free market," Israelite told Variety. "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."
What the new rate means, in terms of strict dollars and cents, is that $1 of every $3.82 that goes from a streaming service to a record label will now be owed to writers and publishers. It's a more equitable split, although it still only represents an incremental step forward in terms of musicians and songwriters seeing any sort of appreciable or consistent income from streaming.
"Songwriters desperately need and deserve the rate increases," said Bart Herbison, executive director for the Nashville Songwriters Association International.
Should the artist/writers receive more? Many say yes. In due time, and at this rate, it could happen sooner than later.
The new royalties seem unlikely to faze Apple, Google and Amazon — all of whom rank among the world's richest companies and operate their music streaming services as complements to other products that generate most of their revenue. The new royalty systems could leave a bigger financial dent in smaller and less diversified companies such as Spotify and Pandora, even though both are music streaming pioneers.
Material from The Associated Press contributed to this article.