Top 10 Reasons Artists Don’t Register with SoundExchange (and 10 reasons you should)

October 20, 2010{ 20 Comments }

-This article was written by our friends at SoundExchange.-

It’s no secret that there are lots of artists who have money waiting at SoundExchange, and we get asked all the time: “Why wouldn’t someone register to receive their royalties?” So below, we’ve listed the reasons we hear most often, along with the answers we give to each one. Here’s a hint before you even get started: There’s no reason not to register.

1. Too good to be true: Believe SoundExchange isn’t for real, or that there are strings/payments attached to money.

We hear this one a lot. We’ve all received emails from third-world “princes” and mailings about free cruises or sweepstakes winnings. So when artists hear about SoundExchange, even from people they know, sometimes they disregard it as ‘too good to be true.’ Well, we’re glad to be able to reassure you: SoundExchange is very real, and so is the money we distribute to artists and copyright holders: $149.5 million* in 2009 alone. There are no strings attached, either. Registration and membership with SoundExchange are always 100% free, don’t impact your rights to your tracks, and won’t prevent you from making private licensing deals with any music-using service. We’re a non-profit, and we just want to get you the money you’ve already earned.

2. Lack of education: don’t understand what SoundExchange is, where this right/royalty/revenue comes from.

SoundExchange, the non-profit performance rights organization which collects and distributes digital performance royalties, is relatively young. Even the artists’ and copyright holders’ right to be paid a royalty when sound recordings are used has only been around since 1995. Many people who might potentially receive these royalties don’t know how these royalties are generated, don’t know that they’re entitled to collect them, or don’t know how to go about claiming their share. Visit http://tinyurl.com/AllAboutSX to check out our history and how it works.

3. Lack of differentiation between copyrights/performance rights organizations (PROs): Believe that ASCAP, BMI, SESAC membership covers all performance royalties for them, or believe that registering with SoundExchange will jeopardize other PRO status.

Many artists we talk to are members of ASCAP, BMI or SESAC, and think that either these organizations cover the same rights as SoundExchange, or that signing up with SoundExchange will somehow jeopardize their membership with these other performance rights organizations. Neither is true. Our friends at ASCAP, BMI and SESAC pay songwriters and publishers. SoundExchange compensates performers and copyright owners for the sound recording itself. If you’re both the performer and the songwriter, you get paid twice. Either way, all performers who also write music should be signed up with eitherASCAP,BMI,orSESAC,andALSOwithSoundExchange.They’re two separate sourcess of money and are not in conflict.

4. Procrastination/confusion: Have heard about SoundExchange or performance royalties, but haven’t gotten around to filling out the forms, believe the registration process is cumbersome or complicated, or have forgotten they meant to do it.
The SoundExchange staff talks to people every day about registering to receive these royalties. But even after several personal contacts from our staff and in many cases, their own friends who are also getting paid, an astounding number of people haven’t done it. Whether they haven’t gotten around to it, or because they’re intimidated by the forms, they don’t register.

We know that registering with SoundExchange can sound a little complicated. Realistically, we can’t control the kinds of information we need, like personal data and tax forms, because we’re independently audited and because these royalties are taxable income. Plus, we need to ensure that we are paying the correct person. Our customer care team will work with you to help make the process as easy as possible.

Registration is the only way to claim the royalties you’ve earned, and it’s your responsibility to make getting paid a priority!

5. Low/incorrect expectations: Potential registrant does not register because they think they will not have a large enough check to warrant the effort, didn’t know digital plays could earn royalties, or believe only big- name artists are eligible.

Because of the proliferation of satellite and Internet radio, independent and up-and-coming artists are getting more play than ever before, and under the law which governs digital performance royalties, an up-and-coming guitarist gets exactly the same per-track rate as the biggest international star. SoundExchange has more than 48,000* artists registered – many of whom aren’t full-time musicians. Not everyone gets hundred-thousand dollar checks, but whether you’ve got $40, $500, or $3,000 waiting, it’s money you’ve already earned. And once you’re registered, you’ll be paid quarterly every time you’re owed, so the money will keep trickling, flowing, or pouring in!

6. Data confusion: Inability to provide data SoundExchange requires, or which they believe SoundExchange requires: ISRC codes, tax ID for band, royalty splits, etc.

While SoundExchange’s account services team appreciates having all the data we can, in order to make sure everyone’s paid efficiently and fairly, we don’t require any of these items for registration. Most of the information we need is easy to find, and doesn’t require any legal knowledge. If you register and something’s missing, we’ll get in touch. Don’t let it stop you from signing up.

7. Registration confusion: Potential registrant believes that they are already signed up because a band mate is signed up, they believed their manager signed them up, or thinks registering to use the PLAYS database is the same as registration.

If your band or group isn’t registered as a legal entity (e.g. The Electric Amoebas, Inc), each member should register individually. One performer’s registration doesn’t automatically sign up his band mates. We have lots of money for groups where only one member has signed up, and the remaining portions of the money are waiting at SoundExchange for the other members to claim them.

If you believe someone else has signed you up, call SoundExchange and make sure. Also, many artists have registered to use our PLAYS database, which does collect a bit of personal information, but is NOT the same as registering to receive your royalties.

If you’re not registered, get registered. If you are registered, tell a band mate or a friend. If you’re not sure, check.

8. Recipient rights confusion: Potential registrant believes they are not eligible to register solo because they don’t own the masters, are under contract with a label, and/or are no longer in contact with their band mates.

No matter what your agreement with a label, the featured performer or group on a track is entitled to 45% of SoundExchange royalties. That portion is paid directly to the artist, no matter who owns the masters. The law that governs SoundExchange’s distribution of royalties supersedes private agreements, and digital performance royalties are not recoupable. If you’re no longer in touch with your old band mates and don’t know what your split is, register with SoundExchange anyway. We will give an even portion to each member unless there’s a conflict. All you have to do receive it is register.

9. Inaccessible artists: Artist has left the business or is deceased.

Music is immortal; people and careers aren’t. SoundExchange collects royalties for every track played – that includes the tracks of artists who haven’t picked up an instrument in twenty years, who’ve long since given up their industry contacts, and even those who’ve passed away. Heirs and estates are still eligible to be paid these royalties, but it’s even more difficult for people outside the music industry to hear aboutSoundExchange and digital royalties.

10. The artist doesn’t like money? They think they’re already overpaid? They’re too busy caring for their pet rocks to fill out the forms?

Honestly, we’re not sure why it’s so hard to get artists to register to receive their royalties. The best way to sway people is by word-of-mouth: that is, when someone they know and trust tells them about royalties from SoundExchange. So help us spread the word, and we can help every artist get paid when they get played.
Register at www.soundexchange.com today!

*All statistics and information accurate as of May 2010.

  • http://www.echolouder.com/ Bruce Warila

    How about – the process of registering (the last time I tried) is far more difficult than it should be!

  • http://www.paulneeds.com Paul Needs

    I believe this is covered in the UK by PRS/PPL Alliance – can UK-based musicians and performers register?

  • http://www.thelightsout.com The Lights Out

    We saw our name on a SoundExchange poster at CMJ last year as one of the bands they had royalties waiting for. We registered, and to complete our registration, we needed to send in a voided check from the band. So first we had to visit City Hall and register as a business partnership. Then we took our business certificate to the bank to open up a joint checking account. Then we ordered checks, and sent SoundExchange a voided one to get the process going.

    Now, this sounds like a lot, and it took time. But registering the band as a partnership was something every band should do, because now we can write off every expense we incur over the course of doing business as a band. Our space rent. Instrument repair. Food, gas and lodging on the road. And it makes it easy to deposit our gig money after shows, and to put shared-band items on the band card. We wouldn't have done this if we hadn't needed to for our SoundExchange application, and it's made our lives a lot easier.

    Bands should also know the payout doesn't happen immediately. It took awhile for our check to arrive, but arrive it did, and we were very happy. When we got the check, we encouraged our friends to register, too:
    http://twitter.com/thelightsout/status/1758533315

    Cheers,

    The Lights Out

    Boston, MA

  • Henry

    I agree with Bruce. I registered last year. While the service they perform is appreciated, the entire process signup is needlessly complicated and incredibly confusing. None of it could be done online, either.

  • http://www.shamanicturtle.com Dave Harpe

    Since CD Baby has 2 of my CDs, and all the numbers and legal poo associated with them, can they help me go through this process? Is there an automated system at CD Baby to handle all that, which I can connect to with a browser? I beleive Bruce is right about the difficulty of registering.

    • Chris R. at CD Baby

      Dave, the only numbers we have are your sales figures on cdbaby.com and through our digital partners which we display in your member account. We don't have any way of tracking or figuring what you're owed for performance royalties. That is a whole different game. You should contact the folks at SoundExchange if you're having trouble navigating their site, though.

  • http://www.shamanicturtle.com Dave Harpe

    Oh, also, I am not known at all, and probably don't get many plays out there. If I have to handle all the complex paperwork myself, it may not pay me but a penny or two an hour to make the effort. I would really need a lot of help with this, and it probably won't be profitable for whoever does it. Is one of the experts at Sound Exchange willing to help if CD Baby can't?

  • Linda Vee

    I have no recollection of signing up with them, but yet we are.

    So I did in sometime in the past

    If it is all that difficult I am wondering why I don't remember LOL

  • http://www.lindawood.com.au Linda Wood

    The one thing i really wanted to hear discussed on this podcast is what to do if you are an artist outside of the US or Canada. I received notification from CD Baby saying I may need to sign up to get royalties from Sound Exchange. But I am in Australia. I am a member of the collection societies over here. How does this work for me?

    I emailed my local collection agencies and asked if they knew anything about this. "No, but you should sign up just in case," was the response. I emailed soundexchange and got a similar response.

    All of this leads me to believe that actually there is not enough information flow between territories, or perhaps not enough cooperation. And how on earth can a DIY artist such as myself keep track of all the different agencies we need to sign up to? It is confusing, not because I don't understand the difference between a writer's royalty and an artist's royalty, but because every time I turn around I find out I have to sign up to another organisation in order to collect monies owing to me.

    How do I keep track of them all?????

    Bewildered down under,

    Linda

    • Chris R. at CD Baby

      SoundExchange is an organization set up to operate according to United States law. So while they CAN collect performance royalties on behalf of international artists for performances that happen within the USA, they cannot collect royalties for any international plays. You would have to investigate the PRO options in your own territory.

  • http://www.SoundExchange.com Laura at SoundExchan

    Dave- we're glad to help out with the registration process. We know it's a little complicated, but it's part of our job to keep careful records, so we can ensure we're paying the right people, and make sure Uncle Sam gets his cut. We created this video: http://bit.ly/sxregvideo to help out.

    Linda- We specialize in the US, obviously, but we get this question so often that we made our own list. We recommend starting here (PDF): http://bit.ly/SXChecklistPDF

    The Lights Out – thanks for the great story! Can we feature you on our "Testimonial Tuesday" blog series? We have so much trouble getting people to believe we're legit and the money is real!

  • http://www.lauradohertymusic.com Laura Doherty

    I just listened to the SoundExchange podcast and the owner/spokesperson talking about how EASY is is to sign up..well, that has not been my experience at all. I registered in January, received confirmation of all my forms and documents in February and then heard and received nothing so far.

    I called SoundExchange today and the woman I spoke with said that my forms were not processed in time for the Sept. distribution. She also told me that it takes 90-120 days to process each artists registration. It's now been 8 months, and when I told her it's obviously been more than 120 days, she just replied "we get so many requests". She told me that everything was set for me to receive royalties in the December distribution, but was not able to tell me what the amount was, and she was not able to send me a confirmation email that my forms has been processed. She also told me that I was not able to manage my account online and see what the distribution numbers were. She was also unable to tell me the date that the funds get distributed to direct deposit, and told me to call back closer to the end of November. It was all so vague.

    So at this point I'm going on faith that I will received any royalties. It's a bit frustrating, knowing that my songs have been playing on XMradio for over a year now, pretty much on a daily basis.

    I think it's awesome that there is a company out there that wants to help the artists, but it was frustrating listening to SoundExchange talk about how there's all this money they are ready to distribute and artist don't take advantage of it.

    You've got one artist here who has filled out the forms, followed all the instructions, and I gotta say, you're not making it so easy. I was glad though that you partnered with CDBaby and got the word out, and thank you CDBaby for your podcasts, they are very informative and helpful.

    SoundExchange, my request to you is to work on making this process easier for artists.

    Thank you,

    Laura

  • http://perhapspiano.com Laura McMillan

    I certainly wish sound exchange would connect with

    mp3ify dot com!! This site offers free downloads of every single video that’s on youtube, copyrighted or not. If your original music is under copyright, all it takes is an email to them with ‘cease and desist request’ in the subject line and links to your youtube video in the body of the email to have them mark it ‘restricted’ on their site so no one can download mp3 free.You will receive a prompt and courteous response from them. They do ‘suggest’ $20 donations on their site, but non of this goes back to the artists, it is used to keep their site up and running. For all who have worked hard to offer mp3 downloads on itunes, cdbaby, etc….I hope this information is helpful.

    Laura McMillan pianist,composer.

  • http://www.lauradohertymusic.com Laura Doherty

    I have a follow-up to my comments are few days ago. I got a phone call from one of the managers at Sound Exchange this week addressing all of my concerns in my previous post. The woman I spoke with was very helpful, and apologized for my previous experience. She informed me of the amount of my first royalty check (which would cover 2 months of my mortgage!!) which I'll receive in December. She gave me the exact date the money will go into my account, and even checked that it was going into the correct bank account, which I was thankful for, because I have switched banks since I had registered with Sound Exchange back in January. My royalty would have gone into the abyss I believe! Whew!!!!! She sent me the form within a few hours, to switch my bank account info, I filled it out, emailed it back and she responded right away that I was all set…..she put my mind at ease!

    So thank you Sound Exchange for following up with me. As an independent artist, this royalty check will be put to good use and couldn't come at a better time. I took the leap a year ago, resigning from a full time director job at a music school, to pursue my kids music career full-time, and it's times like these that make me realize that I am on the right path! There are days of uncertainty, but with hard word, talent and perserverence, it pays off! I always have faith.

    Laura

  • http://www.lucasmiller.net Lucas Miler

    Hey, guys,

    Heard my call on the show (finally getting caught up with the podcast) and you heard right–$2-3 per PLAY on XM/Sirius. I wish I could open my statements and tell you exactly but I don’t have the proper codes to access my most recent statements.

    Doing the math, I’m making about $27/day (quarterly earnings divided by 91.25 days/quarter) and I think the only significant royalties I’m getting are off one channel on satellite radio. There’s no way I’m getting pennies per play or I’d be on the air non-stop. As far as I can tell, they’re playing me less than 10X per day. (XMFan.com is supposed to tell you all the times you’ve been played but I don’t think it’s 100% accurate).

    I tell you all this not to brag (I hope that’s not how it came across–you did ASK for hard figures, right?) but to let everyone know this is REAL money SoundExchange is paying. Everyone seems to be under the impression that their royalties would not be worth the effort it takes to register. I don’t know what, if anything, I get paid when Pandora plays me but satellite radio, being a subscription service, must have to pay more than traditional radio. Maybe it’s because it’s continent-wide?

    I am getting the royalties for owning my masters and as the songwriter (and performance royalty, too?) but I would think most of your listeners would be in the same boat.

    Granted, kids’ music is a separate entity but still, you’ll have no idea what your royalties are until you’ve registered with SoundExchange. I don’t remember it being all that hard personally.

    Anyhoo, keep up the great work and keep playin’!

  • Greta (Avedisian)

    Can i print registration forms and mail them in instead of registering by email

    Thank YOu.

    Greta

  • sam neves

    The site is confusing period. They never address simple questions that any normal person would ask. Even in the faq's.

    1. Is there a way online to tell if you're registered with sound exchange?

    2. Can the royalty amount be determined online. It's 2011 and the site works like a joke. Basic procedure is idiotic. It becomes a job to get money.

    It could easily work like cdbaby, tunecore, itunes, or any other normal process. This is a joke for reals.

    3. Is there an online login to soundexchange to evaluate your account.

    I will call tommorrow and see what they say over the phone.

  • Jillrogoff

    Thanks for the heads up. Somebody posted a video, using one of my recordings, and without asking my permission. They did a nice job, but still…

  • http://www.facebook.com/profile.php?id=1370682683 John Neumann

    Totally confusing organization. I went through the hoops scanning my license, etc. and got signed up, and have actually received a couple bank deposits which surprised me pleasantly, considering how unknown I am. But only part of the royalties are broken down in the statement, and about half is promised to be detailed in some future statement that never comes. Also, I wanted to log in and add some newer songs that I've played on and co-written but for the life of me I can't figure out how to access my information. So basically I'm locked out and can't figure out how to update my information.

  • Seven Neves

    The site is bs. That's why , a piece of ish to steal. They could simplify the site 100 fold if they wanted registrants. They full of it.