If that sounds like a arbitrarily unfair system, well, that’s exactly what it is, reports Music Business Worldwide.
It could literally mean that a stream of a Taylor Swift track – signed to independent label Big Machine – generates less money than a play of a track from the likes of Psy (Universal), New Kids On The Block (Sony) or Paris Hilton (Warner).
This widespread worry amongst indies has been set into motion by the Copyright Royalty Board (CRB) in the US, which has just asked the market’s Copyright Office if it can be permitted to set variable statutory royalty rates for recorded music.
Aka: One rate for some, another rate for others.
Important caveat: there has been no official indication so far that this request is linked to an intention to pay independent artists less than those signed to major labels.
What’s more, accusations are also flying that Sony and Universal are helping drive this potential outcome with a behind-the-scenes lobbying campaign.
The owner of one large global label, speaking under condition of anonymity to Music Business Worldwide, said: “It is bad enough that the regulatory authorities are even considering one rate for the big and one rate for the small; it is bad enough that this battle, so crucial for the future of culture, diversity and entrepreneurship is being pitched in such an arcane corner of the industry playing field. But what is really shocking is the positioning of the two super-majors and their mouthpiece, the RIAA, supporting multiple statutory rates.”
Independent labels are deeply concerned that US web ‘radio’ services such as Pandora and iHeartRadio may soon be permitted to pay less for their music than for tracks from the majors.
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