WASHINGTON, D.C. – May 13, 2013 – SoundExchange was named a finalist in two categories for The 2013 American Business Awards – “Company of the Year – Non-Profit” and for “Communications Campaign of the Year – Low Budget.” As a result, the organization will ultimately be a Gold, Silver, or Bronze Stevie® Award winner in the program.
The American Business Awards are the nation’s premier business awards program. All organizations operating in the U.S. are eligible to submit nominations – public and private, for-profit and non-profit, large and small.

SoundExchange submitted for consideration to receive the award, with competition from more than 3,200 nominations from organizations of all sizes this year. SoundExchange is in the running for “Company of the Year – Non-Profit” for its 2012 organizational accomplishments, and “Communications Campaign of the Year – Low Budget” for its campaign announcing an industry milestone of $1 billion digital performance royalties paid to recording artists and record labels to date.

“It is an honor to be recognized as a finalist in the American Business Awards, which acknowledges our efforts representing the entire music community in the digital age,” said SoundExchange President Michael Huppe. “We remain committed to our work supporting, protecting and propelling the music industry forward. We are proud to receive recognition for our accomplishments achieved in partnership with the creative community.”

Finalists were chosen by more than 140 business professionals nationwide during preliminary judging in April and May. More than 150 members of nine specialized judging committees will determine Stevie Award placements from among the finalists during final judging, to take place May 13-24, 2013.

The American Business Awards will be presented at two awards events: the ABA’s traditional banquet on Monday, June 17, 2013 – in Chicago for the first time, after 10 years in New York; and the new product & technology awards event on Monday, September 16, 2013 in San Francisco.

Details about the awards are available at www.StevieAwards.com/ABA.

“Our first quarter numbers show that this digital radio revenue stream is continuing to grow. We are pleased to see 2013 off to an incredible start for the creators of music,” said SoundExchange President, Michael Huppe. “We are committed to making sure recording artists and record labels receive the compensation they rightfully deserve, and we are proud to help facilitate this growth that helps move the music and creative community forward.”

SoundExchange encourages recording artists and record labels to register to receive their share of this growing digital music revenue stream. Those that also become a SoundExchange member can choose to have SoundExchange collect digital sound recording royalties on their behalf internationally.

So here it is: a list of all the music services who have paid SoundExchange royalties through the last quarter. Keep in mind that being on this list doesn’t mean they’re in compliance with all the terms of SoundExchange’s reporting or payment, or that they’re even eligible to be using the government license – SoundExchange can’t give legal advice, so we’re not in a position to say so either way. Though it may be imperfect, we hope that you’ll find this helpful in determining which services are relying on the statutory license and paying SoundExchange for the use of their sound recordings.

Who Pays SoundExchange? (2012) (View as PDF) (View as Excel)

If you believe there is an error on this list, please contact our Licensing and Enforcement department (l&e@soundexchange.com or 202.559.0555). We’ll be updating the list at regular intervals to bring you the most relevant data.

The royalties are paid by Internet radio, satellite radio and cable radio services for their performance of sound recordings, and are distributed by SoundExchange to recording artists and record labels.

“SoundExchange’s increasing annual royalty payments are a positive indication of where the industry is heading. As digital radio continues to grow, so should the amount that performing artists and rights owners receive for the use of their content,” said SoundExchange President Michael Huppe. “Our distribution represents another record-breaking year for SoundExchange, but more importantly, it means more money in the pockets of the creators of music. We’re optimistic about the industry’s future, and look forward to maximizing digital performance royalties for the people we serve and finding new ways to propel the music industry forward.”

Also in 2012, SoundExchange made several significant organizational enhancements and accomplishments, including:

• Announced more than $1 billion in royalties paid to the creators of music since the organization’s inception.
• Reached thousands of artists and record labels through ongoing outreach as well as several high-profile and effective database matches with partner organizations such as BandPage, CD Baby, American Federation of Musicians (AFM) and The AFM and AFTRA Intellectual Property Rights Distribution Fund (“The AFM and AFTRA Fund”).
• Launched a new online platform to streamline registration and membership process, resulting in the registration of more than more than 15,000 new artists, labels and rights holders in 2012.
• Created a dedicated International department, and signed 10 new agreements for the exchange of royalties with foreign counterparts.
• Increased capacities for processing royalty data and payments through technical overhaul that will continue throughout 2013.

SoundExchange maintains one of the lowest administrative rates in the industry, with an administration rate of 5.3 percent in 2011. (Note: 2012 admin figures are not final as payments are still being received.)

If your service begins streaming February 1 or later, minimum fee payments and corresponding Statements of Account are due within 45 days following the end of the month of first transmission.

Payments and Statements of Accounts can be sent to:

SoundExchange, Inc.
Dept. 4037
Washington, DC 20042-4037

If being sent by overnight delivery (e.g. FedEx, UPS, etc.):

SoundExchange, Inc.
733 10th Street, NW
10th Floor
Washington, DC 20001

Please visit our “How Do I Pay?” page to download the minimum fee Statement of Account forms and access more information about service categories. Please note that each form must include a handwritten signature to be processed.

If you have questions, e-mail us at l&e@soundexchange.com and we will be happy to assist you.

While we support the upward trend that this case demonstrates, the rates for the next term represent a below-market outcome. This is due in no small part to the CRB’s application of a special rate standard that permits below market rates for SiriusXM. We believe that all radio services should pay a fair market rate for their use of sound recordings.

We will continue to fight for the value of music and protect the rights of creators. Meanwhile, we are reviewing the lengthy opinion in greater detail, and have no comment on our plans moving forward at this time.

It is our mission to protect, propel and support the digital music industry moving forward. For this reason, SoundExchange President Michael Huppe will testify today, Wednesday, November 28, before Congress in opposition to the “Internet Radio Fairness Act.” This bill could dramatically cut the royalties that Internet radio services pay to music creators. It also does nothing to address the fact that AM/FM broadcasters still pay nothing in performance royalties to recording artists and record labels.

As representatives of both recording artists and record labels alike, we believe creators deserve more for their contributions to the digital music space, not less. Creators should receive fair compensation for their work, and we will deliver that message directly to Congress.

You may watch the webcast of the hearing today at 11:30 am ET at: http://judiciary.house.gov.

You are also encouraged to visit www.fairpayforartists.com to learn more and write your member of Congress.  Let them know that musicians should not be deprived of the income they deserve.

“This distribution represents yet another record-setting quarter for SoundExchange, but means so much for the recording artists and record labels that rely upon this growing revenue stream. Musicians and rights owners – both superstars and rising stars – have come to depend on these royalty payments,” said Michael Huppe, president, SoundExchange. “We are proud to help facilitate this growth and are passionate about our work in protecting this revenue stream, and moving the music and creative community forward.”

Recording artists and record labels are encouraged to register with SoundExchange to receive their share of this growing digital music revenue stream.

As we head into the weekend, give a listen to some of the answers submitted by our loyal fans. Below is our #resultsplaylist

“Encore” by Jay-Z
“Goldfinger” by Shirley Bassey
“Now you Have Something to die For” by Lamb Of God
“Imagine” by John Lennon
“Another one Bites the Dust” by Queen
“Pandora’s Box” by Nik Kolidas
“Change is Gonna Come” by Sam Cooke
“The Big Payback” by James Brown
“The End” by the Doors
“Eric B is President” by Rakim & Eric B
The End” by the Doors
“Drive My Car” by The Beatles
“Yes We Can” by Lee Dorsey
“What Is And What Should Never Be” by Led Zeppelin
“Cult of Personality” by Living Colour
“Highway to Hell” by ACDC
“The End of the World” by Skeeter Davis
“Anti-Super Hero” by St. Madness
“Keep On Pushing” by The Impressions
“The Ruler’s Back” by Slick Rick
“Make It Happen” by Mariah Carey
“Liar” by Three Dog Night
“We Won’t be Fooled Again” by The Who
“Celebrate” by Kool and The Gang
“The Star Spangled Banner” by Jimi Hendrix Live at Woodstock 1969
“Oh, Happy Day” by Edwin Hawkins
“You Draw A Bad Card” by Bob Marley
“One Nation under a Groove” by 1978 Parliament Funkadelic

SoundExchange cannot speak to Pandora’s calculations or report the exact figures of what we have paid to individual artists (without their permission). However, the specific figures reported in Pandora’s blog post appear to not be historic payments, but instead seem to reflect a projection of what Pandora may pay for those artists’ recordings in the future. Regardless, the blog post suggests that the artists receive 100 percent of the royalties that Pandora pays. That’s typically not the case. In fact, the statutory license that SoundExchange administers ensures that royalties are split to provide for multiple individuals involved on a sound recording. The owner of the sound recording receives 50 percent and 5 percent is shared with the session musicians and backup singers also on the recording. That leaves 45 percent for the featured artists. And to be clear, it also does not account for our 5.3 percent administration fee, one of the lowest in the industry (For more information see recent Billboard article).

While Pandora’s blog post touts how much it pays artists, it ends advocating for a rate standard that would drastically lower the rates it pays to artists. SoundExchange supports the current standard, where artists receive the fair market value for their recordings – not a subsidized, discounted rate that forces artists and copyright owners to fund Pandora’s growth. This is particularly true when you consider that Pandora’s fees are already incredibly low. Currently, the 2012 per-performance rate for Pandora’s free service is $0.0011 per performance, or 1.65 cents per listener per hour. At that rate, a consumer could listen to Pandora 40 hours a month, for 12 months, and Pandora’s royalty load for the sound recordings would still be less than $8 per listener, annually. That’s approximately 500 hours of the user’s time that Pandora is getting for $8 per year.

And even if some top artist receive significant payments as a result of Pandora’s service, what’s wrong with that? By Pandora’s own numbers, it is expected to earn nearly half a billion dollars in the twelve months ending in January 2013 and continue to grow its user base. Why shouldn’t the artists named in Pandora’s blog post (and those that were left unnamed for that matter) share in the rewards of the growth of digital music listenership?

And the digital radio industry is growing, not contracting. There are now more than 1,800 digital radio services in existence today that are taking advantage of the low content usage rates that statutory license that SoundExchange administers. That’s proof positive that others are finding a way to make their business models work under the current content rates.

It’s true that as digital radio continues to grow, so does the amount that performing artists and rights owners receive for the use of their content. We’re proud to support this growth, and it’s our hope that Internet radio platforms like Pandora continue to thrive. But the company can’t cut costs at the expense of musicians. It’s simply unfair.