Signaling the strength of Internet and satellite radio, SoundExchange paid out a record $149 million to record labels and artists in the second quarter of 2013, 55% increase over the same period in 2012.
SoundExchange is the non-profit organization that collects performance royalties from digital music services and distributes them to record labels, performing artists and non-performing artists. Services that use compulsory license established by U.S. copyright law — Pandora, SiriusXM, iHeartRadio et al. — pay to SoundExchange.
“SoundExchange’s most recent distribution is yet another positive indication of where the industry is heading, said Michael Huppe, president and CEO, SoundExchange, in a statement. He added that SoundExchange’s 4.9% administrative fee for 2012, down from 5.2% in 2011, put more money into owners’ and creators’ pockets. The organization takes the fee before distributing money to labels and performers.
The size and growth in SoundExchange payments underlies the current public debate over performance royalties. The most recent $149 million distribution was preceded by distributions of $117.5 million, $134.9 and $122.5 million in the first quarter, fourth quarter and third quarter, respectively. That’s a total of $523.9 million over the last four quarters. Distributions have grown considerably since the second half of 2011 when SoundExchange doled out $88 million and $89.5 million in the third and fourth quarters, respectively.