5/17/13: Billboard: Majors pledge 50/50 royalty split with artists will stay in direct deals

Paul Maloney
May 17, 2013 - 12:20pm

Billboard cites "a source" and reports:

"Major labels have made a commitment with SoundExchange to pay half of royalties from a statutory service in the event they have negotiated a direct deal. In other words, a major label with a direct deal with Pandora would still pay to SoundExchange the 50% of royalties afforded to artists under the statutory license. The label would not keep 100% of royalties and pay artists a royalty -- after recoupment -- as it does with royalties from purchases and non-statutory services."

Earlier this week (here) we discussed the fact that sound recording copyright owners are only legally required to split U.S. Internet radio royalties 50/50 with performers when the webcaster operates under the "statutory" webcast licenses (those are the deals which cover all recorded copyright music, with royalties payable to SoundExchange). In other words, copyright owners striking "marketplace" deals directly with webcasters (which is perfectly legal to do) are not under the 50/50 split requirement, and only need compensate performers under the terms of the individual artist/label contract.

This fact led some to speculate that direct license deals could benefit webcasters and copyright owners (labels) alike, to the detriment of artists. For example, a label and operator could negotiate a deal which pays the label just 67% of what it would have under the statutory. The webcaster gets a one-third discount, and the label earns more than the 50% of the statutory royalty.

Industry expert David Touve most recently examined this situation in light of Apple's direct label negotiations for its updcoming streaming radio service. He wrote, "it didn’t take a rocket scientist to anticipate that direct licenses for an iRadio service could get negotiated at rates below the webcaster rates formally established through the Copyright Royalty Board (CRB) or published Settlement agreement." Read more here.

Satellite radio operator SiriusXM and broadcasters like Clear Channel and Entercom have forged direct webcast royalty deals with several independent labels over the past months. Billboard says its source "does not know if independent labels have made a similar commitment with SoundExchange."

Read Billboard's story here.

Paul Maloney
May 17, 2013 - 12:20pm

This Thursday RAIN Summits comes to Brussels for the second-annual RAIN Summit Europe event.

There's still limited space available. The RAIN Summit Europe web page has all the information you need: the day's full agenda, the complete list of presenters and panelists, social media links, and links to Amiando and Eventbrite to register. The entire day, including lunch and post-show cocktail party, is still just €99.00.

This year's conference will be equally-split between panel discussions and feature presentations from Europe's Internet radio leaders. The day's final feature presentation will be made by Alain Reyes, COO of NRJ Audio (pictured right).

NRJ Group is the French multimedia ownership group that began with a single Paris radio station and grown to own and license stations in more than 20 countries in and outside Europe. NRJ Audio is the company's new media division and mobile app maker. Reyes will demostrate how the NRJ Group's philosophy on new media plays out on the company's digital platform. 

Two more of Europe's Internet radio experts have recently signed on for the panel on audience measurement, "Every Listener Counts:"

Jean-Luc Halleux (left) is managing director of TouchCast, the Liège, Belgium-based company behind CasterStats. CasterStats delivers real-time and historical audience reporting for Internet radio, television, mobile TV, podcasts, or any streaming media. Late last year U.S. webcaster RadioIO became a CasterStats client, and most recently Swiss TXT, the multimedia center of the Swiss public broadcasting organization, signed on. Halleux is an electronics engineer and owns his own website software company, InternetOfficer SPRL.

Pushkar Kulkarni is UK-based Kantar Media international business development director. Kantar Media specializes in gauging the media image and impact for publishers, advertisers, and PR firms. Halleux and Kulkarni, along with the other panelists (we have more on this panel in RAIN here), will discuss the best ways to measure the online audio audience, and consider standards for measurement, including advertiser concerns.

RAIN Summit Europe is this Thursday at the Hotel Bloom in Brussels.

Paul Maloney
May 17, 2013 - 12:20pm

Gizmodo contributor Mario Aguilar decided to find the best "automated DJ" on a streaming music or Internet radio service, pitting eight top services against each other for his "The Best Streaming Radio."  

His original intent was to find the service with the algorithm that created the best sounding user-generated station (he only considered services that offer "generative playlists" -- the ability for users to create "stations" on the fly by simply typing in a single artist, song title, or genre). Nearly immediately he realized picking a winner based solely on a good mix was futile, as they all, by and large, do a pretty good job at this task.

So he widened his considerations to other facets of the services -- "integration with social networks to the design and overall usability of each service's unique features" -- for the shoot-out.

I'll let you click through to see his ranking, but I'll include a few of his points here about specific services:

Turns out he's not a fan of Clear Channel's iHeartRadio service, which (he wrote), "does so little and doesn't do it especially well." He called it "radio in the most traditional sense," and didn't mean it as a compliment, since "regular radio stations are terrible, which is why we turned to the Internet in the first place."

Pandora, which is "showing its age," only fared a little better. He found the service "less evolved" with only "very basic" social integration -- but "if Pandora has a selling point it's simplicity."

And though Last.fm may still have something to offer, in 2013 it "feels ancient." In fact, its concentration on scrobbling (tracking what you listen to on other services) makes it "more of a recommendation engine than a polished way to listen."

Aguilar actually had some high praise for Slacker's human-curated stations, which he says offer the "kind of variety you can't get from a machine." But, alas, this shoot-out was for algorithm-driven "generative playlist" channels. And the newly-redesigned Slacker interface seemed "ambitious and very good- looking, but it's pretty confusing" and "needs streamlining." Perhaps even worse, he said Slacker "completely missed the potential of social" media integration.

So -- does any service offer anything he likes? See which topped Gizmodo's The Best Streaming Radio here.

Paul Maloney
May 17, 2013 - 12:20pm

While broadcast radio's first quarter revenue was flat, digital performed well throughout the quarter, up 9% ($179 million), according to today's RAB report.

"Radio’s digital sector revenue continues to grow as radio stations invest in and promote their digital offerings to listeners, driving increased attention by the ad buying community," commented RAB CEO Erica Farber.

Spot spending by Communication/Cellular advertisers was up 36% for the quarter, making it the top category for the period.

Broadcasters' overall revenue in the first quarter was $3.5 billion, held back by automotive spending's 20% slide.

The RAB's Q1 revenue press release is here.