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SoundExchange: Everything You Need to Know as an Independent Artist

For independent musicians, the world of music royalties can be confusing and overwhelming. There are several organizations that manage and distribute royalties, and each has its own rules and requirements. One of the most important organizations for independent artists to know about is SoundExchange. In this blog post, we’ll explain who SoundExchange is, what they do, why independent artists need them, and how to use them.

Who is SoundExchange?

SoundExchange is a non-profit organization that collects and distributes digital performance royalties on behalf of recording artists and record labels. They were created in 2000 by the Recording Industry Association of America (RIAA) and represent over 230,000 recording artists and rights owners.

What does SoundExchange do?

SoundExchange’s primary function is to collect and distribute digital performance royalties for non-interactive digital music services. This includes streaming services like Spotify, Pandora, and Apple Music, as well as satellite and internet radio stations. Whenever your music is played on one of these services, SoundExchange collects the royalty on your behalf.

Why do independent artists need SoundExchange?

If you’re an independent artist, it’s essential to register with SoundExchange because they collect royalties that you might not be able to collect on your own. The process of collecting digital performance royalties can be complicated, and services like Spotify and Pandora might not have accurate information about who to pay. By registering with SoundExchange, you ensure that you’re getting paid for every digital performance of your music.

How to use SoundExchange

Using SoundExchange is straightforward, but there are a few steps you need to take to get started:

Step 1: Register with SoundExchange
The first step is to register with SoundExchange. You can do this online by visiting their website and creating an account. During the registration process, you’ll provide information about yourself, your music, and your rights ownership. This information is used to ensure that you’re paid accurately.

Step 2: Claim Your Music
Once you’re registered, you’ll need to claim your music. This means providing SoundExchange with a list of your recordings that are eligible for royalties. This list should include the title of the recording, the artist name, the record label, and the release date.

Step 3: Monitor Your Royalties
After you’ve registered and claimed your music, SoundExchange will start collecting royalties on your behalf. You can log in to your account at any time to see how much money you’ve earned and how many digital performances of your music have been reported.

Step 4: Get Paid
SoundExchange distributes royalties on a quarterly basis, and payments are made directly to your bank account. You’ll receive a statement from SoundExchange showing how much you’ve earned and how the payment was calculated.

Conclusion

SoundExchange is an essential organization for independent artists to know about. By registering with them, you ensure that you’re getting paid for every digital performance of your music on streaming services and internet radio stations. The registration process is simple, and once you’re set up, you can monitor your earnings and get paid on a regular basis. So if you’re an independent artist, don’t overlook SoundExchange – it could be the key to maximizing your music royalties. Especially after you’ve done a few campaigns with PlaylistStreams

Royalty Structures: How Do Artists Make Money?

The answer to how much music streaming services pay their artists has always been a complicated one, but today, we will begin to unravel this key component of the music business. Aside from the immediate differences in payments due to distinct digital streaming platforms like Apple Music and Spotify, other factors such as reach and aggregate users can also influence royalty rates and the ability of artists to propel themselves to the upper limits of success.

In the music industry, royalties are payments that individuals with the right to pieces of music (artists, songwriters, producers, and composers) obtain from anyone who uses their licensed music. In other words, people compensate the right holders for the ability to use their music. When an artist’s music is distributed through digital streaming service (DSP) as it is often the case nowadays, they receive a payment for each stream of their music. Interestingly enough though, these platforms such as Spotify and Amazon Music do not have flat and fixed payments that they allocate per stream. Instead, a stream’s royalty rate is determined through the listener’s country and specific location, the artist’s royalty rate, how pricing and currencies vary amongst countries, and if the listener has a free or premium account. Due to these various factors which are always subject to change, it becomes extremely difficult to ascertain a specific stream royalty rate.

Nonetheless, studies of musicians’ payments on a number of digital streaming services have been conducted to gain a general understanding of estimated royalties across platforms. Some general findings include that per stream, Napster pays $0.019, Tidal pays $0.01284, Apple Music pays $0.00783, Google Play Music pays $0.00676, Deezer pays $0.0064, Spotify pays $0.00437, Amazon Music pays $0.00402, Pandora pays $0.00133, and YouTube pays $0.000069. Though these approximate royalty rates for each stream may alert artists to pick the highest paying services first, it is crucial to remember that the platforms with lower payments may still provide unique advantages due to them having higher user totals and greater international reach. Additionally, when artists release music on platforms some of the lower-paying platforms like Apple Music and Spotify, they provide a direct route to the fingertips of millions of fans; a process that used to be much more tedious, taxing, and expensive than now. These factors help provide an artist with the whole picture in digital streaming services and remind them that royalties are just reflections of the value these services bring to the client.

With numbers as low as these, an artist may wonder how it would be possible to achieve financial success to the extent they which through solely streaming. Playlist Streams is how! When an artist uses Playlist Streams, all their streams generate royalties and their music get exposed to large audiences. Although it is possible if your music is received extremely well by the users, this also points to the fact that royalties are simply one part of an artist’s finances. Other aspects such as touring, gigs, CD sales, and so much more will all help artists succeed financially and work in unison with streaming royalties. Furthermore, even if artists were able to make significant sums from just streaming royalties, then a large portion of it will be eaten up by other entities in the process of getting to the artist. For example, the Economist conducted another study in which their experts say that a billion streams on any subscription services bring an average of $7 million for big label companies and $1 million for the artist responsible for creating the music. Through this $1 million may seem like a substantial amount, we must put it into perspective as it is a sum that only a select few artists who top the charts for the day or week will receive. Every artist is nowhere near that popular, and the nonprofit organization Music Industry Research Association found that in a survey of 1,277 musicians, the median musician made $35,000 in 2017 and only $21,300 of that sum was from music-related sources. Clearly, there is a disparity between not just the payments received by label companies and big-name artists, but also between those larger name artists and the majority of the other artists in the industry. There needs to be much more improvement in relation to these rates and allocating a larger portion of them to the creators of the work.

Regardless of the fact that royalties are just one part of the equation and that they need improvement, they are undoubtedly one of the biggest portions of an artist’s financial journey because it allows them to be compensated for each time their music is used for enjoyment and even commercial purposes. Services such as Playlist Streams help boost your streams in an organic manner that will help you gain exposure while also monetizing upon it through the royalties. Ultimately, these royalties are dictated by a myriad of factors and are only one part of your financial journey as an artist. However, the exposure that these streams and royalties can help you gain is unmatched and truly beneficial for your journey in the music industry.

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