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The German songwriter streaming revolt: re-slicing the royalty pie

Key takeaways from our recent event, as the Academy's Songwriter Committee Chair Helienne Lindvall explores new ways to redress the streaming value gap.

In the past year, The Ivors Academy’s Songwriter Committee have been exploring ways of redressing the inequitable way streaming royalties are distributed today. One of the short-term remedies we’ve proposed is for songwriters to receive a per diem when they work with artists, so it was a pleasant surprise to find out that our German colleagues at Verso have implemented such a per diem already.

In addition, German music creators and their manager have been in the news, calling out labels for “keeping a disproportionate amount of income” from streaming, so we invited VERSO members Alexander Freund, Michelle Leonard and Ali Zuckowski to come and discuss this and what other remedies they’re working on with the wider Ivors Academy membership.

One of their core issues is the way streaming revenue is currently distributed, in which all revenue is put into a large pool that is then divided up according to how many streams each song has been streamed across the service. Streaming service Deezer has been championing a user-centric payment system (UCPS), which would distribute each subscriber’s fee solely to the songs that they have listened to. So we also invited Anton Gourman of Deezer, who kicked off our event with an interesting presentation showing what a switch to UCPS might look like.

As an illustration he showed that, currently, if one person listens to 100 streams in a month, and another subscriber listens to 900, only £1.40 of the first person’s subscription fee would go to the artists and writers they listened to while £12.60 of their combined contributions would go to the latter (30% goes to the DSP). Not only would UCPS tie the fee paid to what the user listens to, but it would reduce the benefits for fraudsters to use bots to capture a large part of that streaming revenue pool.

Plenty of interesting stats were presented, including that though only 19% of Deezer subscribers are 18-25 years old, the music they listened to received 24% of royalties, in the current system. Younger listeners also tend to skip more, which distorts the royalty distribution even more.

Alex, Michelle and Ali relayed how posting fee guidelines on the VERSO site helped avoid uncomfortable conversations with clients about per diems, on-hold fees and fees for use of stems. Following was a constructive discussion on how these fees could be implemented practically.

Concluding the event, we agreed that this was just the first step in The Ivors Academy and VERSO exchanging ideas and collaborating in our quest for a better future for all songwriters and composers.

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