The CRB has agreed to drop the 9.1 cent mechanical royalty rate that songwriters and music publishers will earn from the sale of songs during the upcoming 2023-2027 rate period. All participants must now either come up with a new rate settlement or the rate will have to be litigated.
According to MIDiA Research, music catalog sales were up 180% in 2021 year-over-year, totaling $5.3 billion that investors spent on publishing catalogs, recorded music catalogs, and producer royalties. Of the 131 deals tracked, 76% include publishing rights and 49% feature master royalty rights.
SoundExchange distributed $235 million during Q1 2022 for a total of over $9 billion since 2003, reported SoundExchange execs this week. The organization’s president and CEO Michael Huppe touted live music’s ongoing comeback and technology’s role in the space.
In this newsletter:
- The 9.1 Cent Mechanical Royalty Rate Ditched in New CRB Ruling
- Music Catalog Sales Grew 180% Last Year - But Were Likely Up More
- SoundExchange Announces $235 Million Payout for Q1 2022 - $9 Billion Distributed Since 2003
- PPL Announces Nearly $35 Million International Royalties Distribution for Q1 2022
- NetEase Cloud Music Reveals Its Revenues Grew 43% in 2021
- Anitta is First Brazilian Artist to Top Spotify’s Global Chart
Now, the details...
Compiled by Heidi Seo
Exploration Weekly - April 01, 2022
The 9.1 Cent Mechanical Royalty Rate Ditched in New CRB Ruling
On March 29, the Copyright Royalty Board agreed to abandon the 9.1 cent mechanical royalty rate settlement between music publishers, record labels and digital services for the sale of songs during the upcoming 2023-2027 rate period. The CRB judges’ decision came after receiving the settlement from interested parties in a motion to adopt it, as part of the overall rate-setting process, which also determines royalty rates for on-demand streaming. A comment period on the rule allowed others to weigh in on the proposed ruling, bringing in players like the Songwriters Guild of America, which objected to the rate, and other songwriters groups. Now that the judges withdrew the proposed rule and the 9.1 cent rate, that means all participants either have to come up with a new rate settlement on subpart B or the rate will have to be litigated, adding to the already costly rate determination process.
Music Catalog Sales Grew 180% Last Year - But Were Likely Up More
Investors spent $5.3 billion on publishing catalogs, recorded music catalogs and producer royalties in 2021, up 180% from 2020, according to a new report by MIDiA Research. That estimate is based on MIDiA’s tracking of publicly announced catalog acquisitions, such as Sony Music’s acquisition of Bruce Springsteen’s publishing and master royalties for an estimated $500 million. Of the 131 deals tracked by MIDiA Research, 76% include publishing rights and 49% feature master royalty rights. Name, image and likeness rights were part of 4% of the deals tracked by MIDiA. The $5.3 billion figure also included acquisitions of companies’ catalogs, such as Reservoir Media’s purchase of Tommy Boy Music’s recorded music catalog. The actual value of catalog deals in 2021 is far greater than $5.3 billion as MIDiA counted only acquisitions that were publicly reported through outlets such as Billboard, press releases and financial statements.
SoundExchange Announces $235 Million Payout for Q1 2022 - $9 Billion Distributed Since 2003
SoundExchange distributed $235 million during 2022’s first quarter – for a total of over $9 billion since its 2003 debut as a standalone organization – according to higher-ups. The three-month stretch delivered SoundExchange’s 150th royalty distribution – besides the initially mentioned $235 million payout. Addressing the developments in a statement, SoundExchange president and CEO Michael Huppe touted live music’s ongoing comeback and technology’s role in the space. “SoundExchange is powering the future of music by distributing billions of dollars to creators who are the heart and soul of our industry,” relayed Huppe.
PPL Announces Nearly $35 Million International Royalties Distribution for Q1 2022
The UK’s Phonographic Performance Limited (PPL) has announced that it paid out almost $35 million (£26.3 million) in international revenue to some 26,000 rights holders and performers for the first quarter of 2022. This amount reached PPL members as well as members of other collective management organizations (CMOs), and 41 global CMOs paid into the sum, specifically identifying “significant payments” from the United States, Germany, France, and Spain. Overall, the London-headquartered entity has 105 agreements in place with worldwide CMOs, per execs, who likewise communicated that the PPL had collected a total of $296.82 million (£225.7 million) in 2020.
NetEase Cloud Music Reveals Its Revenues Grew 43% in 2021
Cloud Village, the parent company of Chinese music streaming service NetEase Cloud Music, saw its revenues grow by 42.9% to just around US $1.1 billion in 2021 as a whole. Like rival Tencent Music, Cloud Village’s revenues are split between online music (NetEase Cloud Music) and social entertainment services (for example livestreaming). NetEase Cloud Music ended the year with 182.6 million monthly active users, up just 1.2% year-on-year. However, it managed to grow its number of monthly paying users by 80.6% to 28.9 million by the end of 2021. The streaming service also says it now has more than 400,000 independent artists registered and uploading to its platform, which compares to the 300,000 figure announced by Tencent Music earlier this week.
Anitta is First Brazilian Artist to Top Spotify’s Global Chart
Brazilian star Anitta has been rising steadily in recent years, but she hit an important milestone last week by reaching the top of Spotify’s global Top 50 chart with her latest single “Envolver”. Label WMG trumpeted the achievement, with Anitta the first Brazilian artist to reach the top of that chart, and also the first solo Latin woman artist to do so. At the time of writing, “Envolver” was doing 5.2 million daily streams on Spotify. WMG also hailed TikTok’s role in the track’s success, with almost 1 million videos created on that app using “Envolver”, and more than 1.2 billion views of videos using the #envolver hashtag. Instagram Reels has also played a part, with 257K video creations on that platform.
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