Understanding the Songwriter's Battle for Fair Streaming Revenue

In the age of streaming, music fans have unprecedented access to songs at their fingertips, thanks to platforms that offer vast libraries of musical history. While convenient for listeners, this shift has significantly impacted songwriters' financial wellbeing.

As the music industry embraces streaming, songwriters watch their earnings dwindle despite the increasing consumption of digital music. They're up against industry giants, including major record labels and streaming services like Apple and Spotify, in a struggle for fair compensation.

Breaking Down the Royalty Puzzle

Mechanical Royalties stand as an essential source of income for songwriters. These royalties are payments from those who reproduce their work, including digital reproductions. The Copyright Royalty Board (CRB) in the U.S. sets these rates, which recently increased from 10.5% to 15.1% and will further climb to 15.35% at the start of 2023.

Nevertheless, for each stream, songwriters currently earn a mere $0.0006. The total streaming revenue also feels outdated, as only 20-25% goes to songwriters and publishers, while the rest largely benefits artists and record labels.

This distribution model stems from the bygone era of physical records, where producing and shipping hard copies were costly. In contrast, digital distribution incurs minimal costs, sparking debate on whether this revenue split still holds up.

Are Labels Taking Too Much in the Streaming Age?

While labels claim significant risks in artist production and marketing, the dynamics of artist development have shifted. Major labels now often seek out artists who already have a strong online presence and fanbase, reducing their traditional groundwork.

Regardless, songs, which often involve several writers, are the industry's lifeblood. Yet, despite their crucial role, songwriters aren't getting a fair share even as the music business increasingly depends on their craft.

The conflict is compounded by conglomerates that own both major record labels and music publishing companies, creating a clear conflict of interest in royalty negotiations.

The Paradox of Streaming Services in the Music Industry

Streaming platforms have, on one hand, saved the industry from the piracy crisis of the early 2000s. Yet, while all parties acknowledge that songwriters should be remunerated better, there's disagreement on where the additional funds for songwriters should come from.

The debate highlights industry ironies and reflects broader global economic concerns, where the creators often see the least benefit from their work while tech companies capitalize massively.

songwriters, streaming, royalties