SoundExchange – Definition & Detailed Explanation – Music Business Glossary

What is SoundExchange?

SoundExchange is a non-profit organization that collects and distributes digital performance royalties on behalf of recording artists and record labels. These royalties are generated from the digital streaming of music on platforms such as Pandora, Spotify, and Apple Music. SoundExchange was established in 2000 as a response to the growing digital music industry and the need for a centralized organization to collect and distribute royalties to rights holders.

How does SoundExchange work?

SoundExchange operates by collecting royalties from digital music services and distributing them to artists, record labels, and other rights holders. The organization uses data from these services to track the usage of songs and calculate the royalties owed to rights holders. SoundExchange then distributes these royalties to the appropriate parties based on the usage of their music.

Who benefits from SoundExchange?

SoundExchange benefits recording artists, record labels, and other rights holders by ensuring that they receive fair compensation for the digital streaming of their music. Artists who may not have access to traditional royalty collection organizations can still receive royalties through SoundExchange. Additionally, SoundExchange helps to streamline the process of royalty collection and distribution, making it easier for rights holders to get paid for their work.

What is the difference between SoundExchange and other royalty collection organizations?

SoundExchange differs from other royalty collection organizations in that it specifically focuses on digital performance royalties. While organizations like ASCAP and BMI collect royalties for public performances of music, SoundExchange collects royalties for digital performances. This includes streaming services, satellite radio, and internet radio. SoundExchange also operates as a non-profit organization, with a mission to ensure that rights holders receive fair compensation for their work.

How can artists and rights holders register with SoundExchange?

To register with SoundExchange, artists and rights holders must create an account on the organization’s website and provide information about their music and rights ownership. Once registered, rights holders can track the performance of their music and receive royalties from digital streaming services. SoundExchange also offers resources and support to help rights holders navigate the process of collecting royalties and understanding their rights.

What are some common misconceptions about SoundExchange?

One common misconception about SoundExchange is that it only benefits major recording artists and record labels. In reality, SoundExchange works with artists of all levels and sizes to ensure that they receive fair compensation for their music. Another misconception is that SoundExchange is a for-profit organization that takes a cut of royalties. SoundExchange operates as a non-profit organization and distributes all royalties collected to rights holders. Overall, SoundExchange plays a crucial role in the digital music industry by ensuring that artists and rights holders are fairly compensated for their work.