Licensing: The 2 most important questions

Let’s dream for a while. Let’s assume you realized the dream you had when you were young and actually became a successful recording artist. The journey wasn’t easy! The competition is fierce. You fought long and hard and every dollar came with grueling work and hustle.

Now, you’ve spent the last few months in the recording studio where you have poured your heart and soul into a new album. Not only did you spend a lot of time but you also invested money recording the album and now you need to make sure your album gets promoted so that you can rack up enough streams to make ends meet.

That’s why you get excited when you walk into your favorite store and the play your song!!! The song you wrote months ago is now being played to thousands of shoppers!

Surely this is payday! Right?

Months later, when you look over your income statements you realize you haven’t gotten a single cent. How is this even possible? Unfortunately this is the sad truth for a lot of artists. Let’s explain why the background music eco-system is broken and what we need to do to fix it!

“Surely this is payday! Right?”

Let me give you a few examples of how our corner of the music industry actually works in 2017.

First, we may take for granted that all music these days is digitally distributed and streamed. Not so fast! Spotify, Apple and YouTune didn’t happen in stores. There are no streaming platforms for retail! Most brands still use CD’s or satellite feeds to play music.

This is a real problem since the reporting then needs to be done manually. Stores need to log what CD’s they play or what satellite channels they switch to. Obviously, this rarely happen or is done in a less-than-frequent manner.

Now this is a real problem because without reporting data of what music has been played - how can rightsholders distribute money to the rights composers, musicians and performers?

Quite often, rightsholders use “analogies” to distribute revenues. An “analogy” is simply looking at what has been played on radio and then applying the same usage to background music. Again, this is problem because radio usually plays hits while stores often use more subtle music. Simply put - the wrong people get paid and the right people don’t get paid.

And that’s just the immediate effect. The long term effect is that the credibility of the rightsholders collecting process is undermined. Brands start asking “Why should we pay for the use of music we use when the system is broken?"

Soundtrack solves this problem!

We started Soundtrack based on a very simple question “Do we believe that stores will play CD’s in the future?”. Of course they won’t! Just as in the consumer space, retail stores will start using streaming and we’re the pioneers building that technology!

Because we are a streaming platform, we know exactly what we played when and where. Our customers don’t need to bother at all, it’s all automatic! This also mean that we can provide rights holders with detailed and correct data that they in turn can use to pay the right composer, musician and performer! We think this is fair play!

Two questions every brand needs to ask their music supplier!

1. Are you properly licensed? Ask to see agreements with rightsholders! Remember that there is legal and monetary risk in using unlicensed music.

2. Do you report track-by-track? Make sure that your background music provider uses modern reporting standards such DDEX that enables rightsholders to pay out money the right composer, musician and artist!