New Royalty agreement on the Horizon for Labels & Artist

New Royaltyagreement on the Horizon for Labels & Artist

In the recording industry a large basis for providing income is royalties, while radio stations until recently have been legally bound to only pay these royalties to producers and writers their seems to be a company challenging the status quo. Clear Channel Communications recently has come to an agreement with Big Machine, Taylor Swifts record label that will allow the label to collect royalty checks for songs played by their station and affiliates. This is the first agreement of its kind in decades, which has come on the heels of much heated debate between the labels and radio stations to congress. What you may find interesting is that the United States is actually the only country that currently does not allow the labels to collect royalties on their artist and only pays these royalties to writers and producers. Performing artist have argued that the multibillion dollar industry have long been exempt from paying royalties when they use their recording to fuel their industry. (Ben Sisari, 2010)

The digital age has sent companies into a frenzy scrambling to streamline their company business models in an effort to adapt to the ever-changing marketplace. Companies like SoundExchange, a company that processes online royalties made several deals with foreign countries bringing their total to 22 companies that it will now collect royalties from while companies like Sirius XM radio has opted to avoid SoundExchange in an effort to pursue direct licensing agreements with record labels which has proven to be negative for the company. With the biggest radio group (Clear Channel Communications) breaking ranks to get a deal like this done you can only assume that the others will soon follow suit ushering a new age of possibilities for the recording industry to begin generating revenue, there may be hope yet for the dinosaurs that are the Major Record Labels.