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Royalties On The Rise

WASHINGTON DC (Hypebot) – Digital collection agency SoundExchange has released 2009 financials showing $155.5 million distributed to artists and copyright holders from $204 million collected from streaming services including internet and satellite radio, and cable TV music services. That's a 20% increase in collections and a 55% increase in payments over 2008.

SoundExchange says the increase comes from the jump in streaming services, 5,335 new artists registering, and data clean-up resulting in improved processing.

Artists saw royalty checks grow  an average of 57% in 2009, and copyright holders saw a 37% increase according to SoundExchange. But while reporting the increases, the non-profit admitted that the numbers could have been higher and blamed three factors:

1) Artists and copyright holders who have not registered despite an aggressive registration campaign
2) Streaming music services which, according to Soundexchange sometimes pay royalties incorrectly or supply incomplete data and
3) some existing SoundExchange registrants who have not updated payment information leading to missed payments.

These same three factors contributed to SoundExchange sitting with a 2009 year end balance of $294 million.

They blame the substantial balance on: $88M in "pipeline funds" that had recently been paid in and have since gone out, $42.9M was collected without artist or label data attached, $25M held from webcasters disputing the rates they pay and $16M in temporary administrative holds on funds plus funds remaining in the 2006 reserve for artists and labels.

A Snapshot Of 2010 Estimates:

But SoundExchange's efforts to clean up data and register artists seems to be paying off. Preliminary 2010 numbers shared with Hypebot show an improving picture. These 2010 numbers are pre-audit, and Q4 estimates are based on the certified distribution total:

Total distributions: $251.9 M (up 68% from 2009)
Administrative fee: 6.9% (down 10.4% from 2009)
Total collections: $261.5 M (up 28% from 2009)
New registrations received:10,953 (up 184% from 2009)
Entries resolved & removed from unpaid lists:16,080
Average annual payment per artist: $2,800 (up 80% from 2009)
Average annual payment per SRCO: $14,000 (up 39% from 2009)