Songwriters will now get a larger cut of the revenues that streaming services, such as Spotify, make from customers. The U.S.-based Copyright Royalty Board has ruled that songwriters will get at least a 15.1% share of streaming revenues over the next five years; this is up from 10.5%.
The National Music Publishers’ Association President and CEO David Israelite said:
“The decision represents two years of advocacy regarding how unfairly songwriters are treated under current law and how crucial their contributions are to streaming services. We thank the songwriters who shared their stories with the court and helped illustrate how badly these rate increases are needed. While the court did not grant songwriters a per-stream rate, the increases in overall rates and favorable terms are a huge win for music creators.”
The change will affect many companies involved in streaming including Alphabet, which owns YouTube and Google, Amazon, Apple, Spotify, and Pandora. While it’s good news for content creators, it’ll cause some of the companies that stream to struggle a bit more. Spotify, for example, already loses money due to music rights.
The ruling could see ordinary consumers paying more for subscription services. It could even spell an end to free tiers if content creators keep pushing for more and more of the share of revenues.