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The Ivors Academy calls for a fair share of streaming revenue for music creators

Streaming needs to reward the writers that drive music’s value.

The publishing community (songwriters, performing right organisations and music publishers) are underpaid in the digital world. The recorded music business (the labels) is already deep into a period of unprecedented growth and it will double in size over the next 10 years. This increase will be driven primarily by the growth in streaming. This increase will come even without the benefits from fixing the problems of free music (whether You-Tube or piracy) and the extraordinary potential of emerging territories such as China and India.

Songwriters, composers and their publishers should participate in this boom because the song and symphony are the foundations on which the business is built, we create the raw material that drives the growth of the entire industry. But currently our community will not enjoy the same boom as artists and labels because:

1) Publishing gets a much smaller percentage of revenue that is derived from streaming

2) There will be a decline in the royalties that writers and publishers have enjoyed from broadcasting (which is in decline as a part of a migration of audience and broadcast from linear to online)

3) The remaining royalties writers and publishers receive from live and public performance are in lower growth.

Commenting, Crispin Hunt, Chair of the Ivors Academy said: “The streaming rates issue is the most important and urgent priority for songwriters and composers. It is, in fact, the defining issue of the age for our community.”

Creators should receive a third of streaming revenue.

Record labels have managed to secure between 50%-60% of digital services’ income while the publishing sector has agreed to receive much less, with rates of circa 15% for subscription services being typical.

Songwriters, composers and music publishers have allowed the music industry to push an old-world model into a new world market. Rather than 15% music creators should receive at least 30% or the model will fail for creators, hence undermining the value for all music.

The percentage of record companies’ income from digital services globally is now in excess of 60% and their profits have increased from the reduced costs involved in distributing and marketing music online. By contrast, for the publishing sector, digital occupies a mere 20% of overall income (less in Europe and more in North America). Although there are some explanations for some of the difference, the net result has been a disaster for the community and it is urgent we address this issue now. The current splits are simply unsustainable.

The Ivors Academy’s primary policy target is: to develop and enact strategy to remedy the current injustice; to develop financial arguments which demonstrate by what level our community is underpaid; to campaign side by side with our partners, the Publishers and Collecting Societies, to correct the current anachronistic imbalance; seeking to ‘update’ and reform music’s business model and design a model that reflects the future of Music creation. One that sustainably rewards the writers on whose work the entire Music Industry exists and to whose work the world dances.

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