Recording Industry Launches SoundExchange - InformationWeek

InformationWeek is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them.Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.


Recording Industry Launches SoundExchange

In a development that could ultimately hold implications for the way musicians and copyright owners are compensated for music downloads and file-sharing, the recording industry has launched SoundExchange, a servicing agent that will collect and distribute performance-rights fees on music played over formats such as Internet radio, Webcasts, digital cable, and satellite delivery.

Years in the making, SoundExchange will make its first distribution sometime next year. Once the exhaustive system to manage the administration of performance-rights royalties is fully implemented, copyright owners can expect to receive 50% of the fees, featured artists will get 45%, and nonfeatured artists will divide the remaining 5%. Before it could launch, SoundExchange had to log millions of performances to ensure that it could accurately distribute royalties. Internet radio is expected to be the largest generator of performance-rights royalties under the program.

John Simson, executive director of artist and label relations for SoundExchange, says fees paid voluntarily by digital outlets have been held in limbo while SoundExchange was being developed. Simson says he's hopeful that now that a royalties mechanism is in place, the purveyors of digital downloads and file-sharing services can build on that foundation. "It shows that we can bring some rules to the digital space," Simson says. "Hopefully, that will move into those other areas."

Jupiter Research analyst Aram Sinnreich says the creation of SoundExchange is a positive move that should have an impact on the models being developed for downloads and file-sharing. But Sinnreich says altruism is not the sole motivation behind the creation of SoundExchange. Sinnreich says that as online rights management becomes more sophisticated, allowing sites to pay royalties directly to artists and copyright owners, rights agencies such as the Recording Industry Association of America--a key force in the creation of the SoundExchange--could be left out in the cold. In other words, it was in their best interest to establish themselves as de facto agents. "Any progress toward solidifying this stuff is going to be good for all parties," he says. "But the real winner is the rights agencies who will end up entrenched in the process."

We welcome your comments on this topic on our social media channels, or [contact us directly] with questions about the site.
Comment  | 
Print  | 
More Insights
The State of Cloud Computing - Fall 2020
The State of Cloud Computing - Fall 2020
Download this report to compare how cloud usage and spending patterns have changed in 2020, and how respondents think they'll evolve over the next two years.
2021 Outlook: Tackling Cloud Transformation Choices
Joao-Pierre S. Ruth, Senior Writer,  1/4/2021
Enterprise IT Leaders Face Two Paths to AI
Jessica Davis, Senior Editor, Enterprise Apps,  12/23/2020
10 IT Trends to Watch for in 2021
Cynthia Harvey, Freelance Journalist, InformationWeek,  12/22/2020
Register for InformationWeek Newsletters
Current Issue
2021 Top Enterprise IT Trends
We've identified the key trends that are poised to impact the IT landscape in 2021. Find out why they're important and how they will affect you.
White Papers
Twitter Feed
Sponsored Live Streaming Video
Everything You've Been Told About Mobility Is Wrong
Attend this video symposium with Sean Wisdom, Global Director of Mobility Solutions, and learn about how you can harness powerful new products to mobilize your business potential.
Sponsored Video
Flash Poll