The CRB has approved new royalty rates, set to take effect in 2023. What does this mean for songwriters and how do you make sure you’re getting paid properly?
Change is an inevitable part of life, and the same is true in the music industry. Earlier this month, the US Copyright Royalty Board (CRB) announced that it had approved a new settlement agreement for royalty rates on physical products, permanent downloads, ringtones, and music bundles. This settlement agreement—which has been dubbed “Settlement 2”—will take effect on January 1st, 2023, and will be part of Phonorecords IV.
Under this new settlement, songwriters will earn a higher rate of 12 cents per track or 2.31 cents per minute of playing time (whichever is larger) for physical products and permanent downloads, with the option for inflation-based adjustments in subsequent years. Ringtones will maintain their current rate of 24 cents per track or 4.62 cents per minute of playing time, until 2026.
What Does This Mean For Songwriters?
This news comes as a welcome surprise to many musicians and songwriters who have long been advocating for better royalty rates. The CRB estimates that these higher rates will result in an approximately 20% increase in payouts to songwriters over the next five years. Additionally, this new settlement also includes provisions that would allow for inflation-based adjustments each year after 2026.
How Can I Make Sure I’m Getting Paid Properly?
It is important that all musicians and songwriters review their contracts carefully before signing them to make sure they are getting paid properly according to Settlement 2’s guidelines. It can be difficult to keep track of all the changing laws and regulations related to copyright law so it may be helpful to seek advice from an experienced attorney or professional consultant if you are having trouble understanding any aspect of your contract or royalties payments structure, or seek out information from one of the many online resources available.
The CRB’s announcement regarding Settlement 2 is great news for musicians and songwriters across the country who have been advocating for better royalty rates for years now. With this new settlement in place starting on January 1st, 2023, songwriters should expect to see an increase in their income which could translate into more opportunities for creativity and collaboration down the line!
