SoundExchange Announces Big Payout

SoundExchange, the non-profit performance rights organization appointed by Congress to pay digital royalties to recording artists and sound recording copyright holders, announced today that it has begun sending out checks in its largest-ever quarterly distribution. A total of $51.7 million in royalties from digital transmissions, including Internet radio, satellite radio, and cable TV music channels, are on their way to recording artists and copyright holders. The unprecedented amount represents a 135% increase over first quarter payments last year, and surpasses the previous record distribution by nearly $10 million.

“This was the result of a lot of hard work by our staff, and also represents a new commitment by our registrants to help increase these amounts,” said SoundExchange’s Executive Director John Simson. “In addition to our usual distribution amounts, this total includes millions of dollars which were freed up by our commitment to cleaning up the bad data which is often reported to us by services.”

Simson has spoken publicly about the challenge posed by poor reporting by the digital services which use sound recordings. During this quarter, however, SoundExchange staff worked with registrants to resolve thousands of entries reported as “label unknown” or attributed incorrectly, by encouraging owners and artists to claim the tracks individually. SoundExchange staff also put in many man-hours of research to correct data so that funds could be distributed properly.

The independent label community received its largest-ever portion of digital revenues this quarter. Many individual recipients received their largest checks to date.

“In this time of shrinking revenues from so many other sources, our SoundExchange income was large enough to have paid the production costs of a new album and more,” said Bruce Iglauer, owner/operator of Alligator Records, “Absolutely every label and every recording artist should be a member. It’s simply all positives and no negatives.”

Simson pointed out that the higher payout resulted from more and bigger radio stations simulcasting online, the growth in streaming services like Pandora and a recent increase in satellite radio subscriptions aided by rising cars sales. Simson also credited his organization’s outreach to artists who had not previously received royalties with a portion of the growth. When artists and copyright holders register with SoundExchange, they receive lump sums of the royalties they have accrued since 1996. A flood of new registrations, fueled by SoundExchange’s ramped-up awareness efforts in mid-2009, meant lots of those checks were issued in the first quarter.

“We’re extremely proud of what we do here,” Simson said of the quarter’s achievements, “It’s a challenge and a privilege to be a part of the process that sees the creators of music fairly paid for their invaluable work.”