What’s Worth More, The Song Or The Recording?


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Atlas Music Publishing CEO Richard Stumpf Weighs In

There’s been a lot of recent debate within the industry over the future of US music royalties. [Check out our fact sheet for a crash course on the basics of music licensing rights] With the US Copyright Office holding hearings and roundtables and a recent House Judiciary subcommittee specifically regarding music licensing, labels, publishers, artists, songwriters, and technology companies are all vying for position to determine who’s going to make what in the digital future of music royalties.

Royalty negotiations have traditionally pitted labels and artists against publishers and songwriters as they “divvy up the pie,” but with technology services like Spotify and Pandora now at the table too, there’s a growing chorus of music rights leaders pushing for a more unified approach to maximize the value of music in the digital age. But working together means agreeing on the value of a song composition versus a recording. Traditionally that’s been such a point of disagreement that the government has had to set some of the rules. Atlas Music CEO Richard Stumpf’s solution is elegant and simple: split everything down the middle.

What’s worth more, the song or the recording?

The rights answer is, “it’s a tie.” But that’s not currently how these siblings are treated.

The debate over music licensing royalties for digital mediums has shined a light on the fact that, when it comes to royalty rates, songs and recordings are treated very differently, seemingly without rhyme or reason. Depending on the type of transmission, we have cases where the song (and songwriter) is paid something and the recording (and performing artist) nothing (i.e. terrestrial radio), and other cases where the recording is paid much more than the song (i.e. digital streaming services like Pandora).

When I was in DC this April for GRAMMY on the Hill, concepts like “one music” and “equity” were thrown around as rallying cries for a more unified system of licensing. As an industry, we now need to put our money where our mouths are. If indeed we believe in these catch phrases, the answer is very simple.

Publishers and record labels have a chance to work together towards increasing the overall top line number and then share the results equally, regardless of distribution medium. This is how we’ve always operated for synchronization revenue, and this logic needs to be applied across the board to all music rights.

If we as “one industry” can get negotiate 55% – 60% of Pandora’s revenue for rights holders, then the song and recording should split that evenly. Similarly, if we can get 10% – 15% from terrestrial radio, this too should be split evenly between recording and song.

Additionally, the money should flow from the service to the label and to the publisher in parallel, not through the label and then a portion to the publisher [the current process for paying mechanical royalties to publishers]. The song and the recording should be treated equally.

Who’s to say whether the writer or artist added “the most” value to the resulting work? It’s impossible. It is a symbiotic relationship. Was it Frank or Sammy, Billy Mann or Pink, Dr. Luke or Katy Perry? It was both. One without the other would remove the magic.

As is always the case in life, most complex issues can be boiled down to playground rules. If there are two kids and one swing, they share it. Most kids do this on their own. The government rarely has to step in. I watch my 7 year old “share and be fair.’

Can’t we in the music business remember these simple rules? We will all be better off if we do.

Richard Stumpf is the founder and CEO of New York City-based publishing venture Atlas Music Publishing. Founded in 2013, the company currently represents songs performed by artists such as John Legend, Colbie Caillat, Chris Daughtry, The Wanted, Icona Pop, Prince Royce and Krewella. Richard has worked in label and publishing executive positions across the industry and currently sits or has sat on Boards for National Music Publishers Association, American Association of Independent Music, Association of Independent Music Publishers, and The Recording Academy, for which he is a voting member.

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