Musicians Are Attacking The Wrong Enemy

By: Mike Montgomery

Music royalty payments are at an all-time high. So why are artists turning on the streaming companies?

According to the companies that collect royalties for songwriters and publishers, times are good. ASCAP and BMI, the two performance rights organizations (or PROs) that represent almost all songwriters and publishers, are falling over each other to brag about how much money they’ve collected.

In March, ASCAP announced that it was the first PRO in the world to report $1 billion in revenues. The nonprofit boasted of “historic high” distributions of over $883 million to its members. In September, BMI also announced “record breaking revenues” of $1 billion with digital revenues exceeding $100 million for the first time ever.

And yet, songwriters and musicians are complaining loudly that they aren’t getting their share of the pie. They are demanding royalty rate increases and a larger direct cut of streaming companies’ revenues, which already operate at half-mast by paying out 50% or more of revenue to royalties.

Where is this disconnect coming from? On the one hand, it seems like streaming is the engine that is finally starting to turn things around for the suffering music industry. Consumers are embracing platforms like Pandora, iHeart and Soundcloud instead of piracy and as a result, they are once again paying for music with subscriptions or by willingly listening to ads.

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