Beggars to review digital royalty rates

Many musicians argue that not only do streaming companies not pay enough either to songwriters or to recording artists (or more usually to music publishers or collection societies and record labels), record labels in particular pay over only a meagre share of those revenues they do actually get, based on the old style 'per unit' sales from the physical era. Many heritage acts are tacking their labels to court to get a bigger share of the pie. 

Now Beggars Group digital chief Simon Wheeler has told the latest MusicTank event that the independent music firm was now reviewing the cut of streaming income it passes on to its artists at a session that featured Billy Bragg whose focus is not so much what royalties the streaming services are paying to the labels, but again on how much of that money the record companies are passing on to artists. Bragg argues that with the costs and risks associated with digital content much less than when pressing and distributing physical product, labels should be paying a higher cut of that income to the artist - and like others argues for a 50/50 spilt of this income between label and artist. The major labels have (juding from the law suits) seemingly been paying a much lower artist royalty on digital income, certainly for downloads, and often for streams too, sometimes opting for the same revenue cut as with physical record sales. 

Simon Wheeler

Beggars seemed to stand out as a 'fair' label and opted for the 50/50 split, but Wheeler confirmed that that policy was now up for review. "As I said at that MusicTank event two years ago  .... as a company we felt that as the streaming music market first emerged it was appropriate to share this new income stream with our artists on a 50/50 basis. But we were always clear that if and when streaming became a significant part of our overall business, that was something we would have to review". Streaming now accounts for 40% of the company's overall global digital income and the company is looking to reduce the artist's share. Wheeler confirmed adding "The costs of running the company need to be covered by sales income, and the streaming revenue stream now needs to bear its share of those costs. So we will be reviewing our policy on what split of streaming income we pass onto the artist. That rate, once decided, will likely be applied to all existing contracts, and all new contracts moving forward. I can't say what rate we will decide on, though we will seek the best possible rate for artists that also enables us to provide the kind of global resources our artists require".