Streaming Money Is Flowing … But Where To ?
So we see , in a very consolidated way , all of the streaming activity that is happening from all of these services . We run this through our system and turn around and invoice those online services on a quarterly basis for everything we represent . We have extensive data matching capabilities , but we ’ re talking about millions and millions of works . Every quarter there are going to be works that we can ’ t invoice on because these works are either in the public domain , or are not in our repertoire , or their ownership is simply unknown .”
It ’ s common , especially in pop , R & B , and hip-hop , for there to be multiple writers and publishers with combined ownership of a single song . Rioux adds it ’ s possible , for example , to invoice and distribute royalties for 75 per cent of a song but not be able to identify the other 25 per cent ownership on that song . It could be because the ownership hasn ’ t been fully worked out between the various publishers and songwriters , or it could belong to a kid who got lucky , wrote a song that ’ s getting attention , and they haven ’ t yet joined the collectives needed to get paid .
“ We get new usage files every month so our work is ongoing and it ’ s a completely iterative process . When we cannot invoice the royalties on the first pass – once we ’ ve done all of the loads and matching and we ’ ve sent our invoice – the data for the
SOCAN ’ S JENNIFER BROWN unmatched works , or unknown shares , remain in our system for future processing . When new songs get registered and when new rights holders affiliate with us , then we retroactively invoice all of the royalties that we weren ’ t able to invoice before . CSI can only invoice the royalties we know we represent and can distribute to the rightful owner .”
SOCAN ’ s administrative process works very similarly . “ We work with [ services ’] data people , and we have data specialists here , and we make sure that we ’ re getting all performances that occur in Canada . With that performance information comes as much data as they can provide – the song , the artist , if they have the creator information , any identifiers that they have – and we pull all that information in and get that paid out ,” says Brown . The individual members ’ shares of the royalties depend on the revenue received divided by the number of streams in that quarter and their percentage of those streams .
So , if 12.78 per cent of the on-demand services ’ gross revenue is going to publishers and songwriters via SOCAN and CSI , that leaves 87.22 per cent to be accounted for . Who is getting what share of that ? This is where things are harder to ascertain .
Unlike the negotiations and agreements between SOCAN , CSI , and the on-demand streaming services , which are largely done in front of a copyright board , the negotiations between the major labels and services are done privately and little-to-no information from the contracts is disclosed . For this article , Canadian Musician reached out to the three major labels in Canada . Warner Music Canada offered a “ no comment ” while Sony Music Entertainment Canada and Universal Music Canada deferred comment to Music Canada , which advocates on behalf of the major labels but is not privy to their agreements with the streaming services . As well , Spotify Canada offered a “ no comment ” while Apple Canada and Tidal did not reply to multiple interview requests . A public affairs representative for Google Canada initially agreed to arrange an interview but asked for further information on the article and interview topic .
After Canadian Musician answered their question , follow-up emails and phone calls went unanswered . As a result , we ’ re left making educated estimates .
Currently , Spotify says it pays nearly 70 per cent of revenue to rights holders and Apple Music says it pays 71.5 per cent of total subscription revenue to rights holders . ( We ’ ll take them at their word , but both numbers have been questioned publically by industry insiders in the U . S . who say the rate is lower .) Google Play Music has not said what percentage of its revenue it pays back to rights holders . But if SOCAN / CSI receive 12.78 per cent , the services keep about 30 per cent , then that leaves about 57 per cent for the labels . That number can go up or down depending on what figures , reports , and estimates you ’ re looking at . The music industry website Music Business Worldwide reported on an internal study commissioned by the SNEP , which is Music Canada ’ s French counterpart representing the major labels in France . That SNEP-commissioned report , which created a breakdown of subscription revenue from Deezer and Spotify , estimated writers / publishers got 10 per cent , 17 per cent went to taxes , the service kept 21 per cent , the artists ( mostly paid by their label ) got seven per cent , and the major labels retained 46 per cent . Post tax , the numbers in the SNEP report are starker , with the major labels keeping 73 per cent of the post-tax payout and publishers / songwriters getting 16 per cent and artists getting just 10.9 per cent of the payout .
“ I do think that music publishers and songwriters are still not getting the full share they deserve , and I think that is true in Canada , as well . When you look at the ratios between what the record company side is getting versus what the songwriters and music publishers are getting , that balance , I think , is not right ,” says Rioux . “ When the first online music services launched in Canada , their first move was to go to the major record companies to get licences
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