The Orchard Is Now Skipping SoundExchange…

Because SoundExchange never really got their shit together



16 Responses

  1. Robert von Anzen

    My company migrated with others from IODA to The Orchard and they have more than proved themselves since.

    So it will be with this particular move : the proof will be in the pudding. We have plenty of data points with SoundExchange for future comparison with accountings from The Orchard.

    Note The Orchard does the address the thorny issue of commissions to be charged.

    The other shoe to drop is the artist’s : in fact, there may be a volley of shoes getting thrown if those monthly artist checks from SoundExchange are reduced abd fingers are pointed at The Orchard.

  2. BZ

    So this means that the Orchard accepted lower rates than the statutory rates SoundExchange collects (why else would Sirius do a deal). Also means that artists won’t get paid their share directly. Most of the labels that use Orchard are smaller, so the artists probably do not have enough royalties to justify an audit so they will probably never get paid on this income (even if the agreement specifies that the artist share is to be passed through if the label collects it). Lower rates, less transparency and no money if you’re unrecouped. Sounds like a great deal…..

  3. Homies

    Homies? Homies?!?! Man, they’re awfully cool over at The Orchard while pirating away 50% direct pay to artists. Maybe I’m wrong but their email says nothing about preserving this crucial aspect of SoundExchange’s administration of the statutory license. Artists, if your label is distributed by The Orchard and you’ve enjoyed collecting your SoundExchange royalties directly I suggest you run to the phone to call them first thing tomorrow to get clarity on how artist royalties are going to be handled within this direct license.

  4. KD

    Right – what is the new LOWER royalty they negotiated??? Plus, given all the Copyright Royalty Board activity, the statutory rates for satelllite (i.e. Sirius) is likely to go up. So smart move for them to lock in something less than 10% of gross in royalites (approx current rate) when others are paying more like 70% of gross.

    This is a great deal for both The Orchard and Sirius. Artists are getting royally screwed. No surprise, since Sirius has not been paying pre-1972 artists anything!


  5. Musicservices4less

    I would be extremely wary of a direct deal with SiriusXM over SoundExchange. I would be even more hesitant of putting the Orchard or anyone else for that matter, in between you and SiriusXM. At least SoundExchange requires statutory payments. I know for a fact that SiriusXM has in the past, tremendous and outrageous accounting f##kups. They kept it very quiet.
    Even this zine refused to cover it. That’s you Paul. Yeah, my friend, I’m calling you out.
    Has anyone received a notice from the Orchard on this new arrangement? Will you be able to opt out?

  6. Robert von Anzen

    No, as an Orchard distributed label this is the first I’ve heard of it. And I don’t see this up on The Daily Rind.

    I wonder if we are just seeing a draft letter. It’s written in the breezy style of their PR interns.

    The only thing I was aware of was Sony doing a direct deal with Pandora and thinking that Sony influenced/controlled The Orchard might not be far behind. Instead it’s Sirius XM.

    What is Michael Huppe doing to piss off both Merlin and The Orchard?

    • Merlin Member

      @Robert, just wanted to clarify that SoundExchange (Michael Huppe) didn’t do anything to “piss off” Merlin. To the contrary, a key to the Merlin license with Pandora is that the 50% direct artist share is still paid through SoundExchange. The Merlin deal with Pandora is intended to leave artists, the statutory rate and SoundExchange in a healthy place while also creating greater opportunities for Merlin labels to earn (some) more money mostly through enhanced marketing opportunities between them and Pandora.

      As for The Orchard’s deal with Sirius, I’d guess that it has nothing to do with Huppe or SoundExchange pissing them off as much as it speaks to The Orchard looking to grab their distribution fee for these royalties. SiriusXM currently pays 9.5% of their (music related) revenues to SoundExchange (this percentage goes up by 1/2 a percent per year for the term of this rate setting). Labels who rely on the stat rate and SoundExchange pay 0 distribution fee and only have their money reduced by the SoundExchange admin fee (which seems to be something around 5%). Sirius no doubt offered The Orchard less than 9.5% (and certainly didn’t offer the 1/2 percent annual increase) and on top of it now Orchard labels will have the pleasure of paying a 10% or greater distribution fee.

      • Robert von Anzen

        Thank you, Merlin Member (who I may well know personally … ).

        The information you provide is invaluable.

        • Merlin Member

          uh, could be…LOL. nah, if I did know you I’d have hit you up directly. i’m just not saying my name because technically i think i’m under a confidentiality agreement regarding the Pandora license and i don’t know what part(s) i’m allowed to reveal and what parts i’m not. i just know that i used to be with a distributor who may or may not be The Orchard and now i’m not and i know how much they’ve always wanted to get their grubby hands on my SoundExchange royalties.

          • Dan

            Ah that will be the same Merlin that accepted a hugely lowered rate with Pandora then because you fuckwits couldn’t negotiate your way out of your own underwear?

            How’s that amazing deal that you did with YouTube then? The deal that you took ages to get and yet was exactly the same as every other Indie Label had signed weeks before?

    • Jim B

      The Orchard probably got a nonrecoupable payment on top that they aren’t sharing with anyone. Also they are able to take their distribution fee off the top of both featured and non featured artists and the sound recording that they registered but don’t own. The old Orchard deals took 25%, by the way. If you got merged into The Orchard through IODA, there were many IODA deals that never collected Sound Exchange money.

      Does anyone know if the AFM and AFTRA are going to let this happen for the non featured 5%? How can the Orchard bargain away the unions statutory share of performance royalties?

  7. SimplyM

    Well looks like there will be no independent agency watching over them making sure the accounting is correct. Be afraid be very afraid

  8. Sam @ Projekt

    I am not with the Orchard, thankfully. But as an artist, I would much prefer getting paid directly by SoundEx at the always increasing current rate, vs getting locked into a 2014 rate PLUS having The Orchard’s fingers dipping into the pie.

    It’s funny how Paul pitched this story as about SoundEx’s process being flawed, when every person who posted immediately saw that the true story is The Orchard making a landgrab for a big chunk of your royalties.

    That is the real story here.

    • Musicservices4less

      I respectfully disagree. If this story is true (none of my clients who are with the Orchard have received this notice…yet), the real story is SiriusXM approaching the Orchard. As indicated in my prior post, SiriusXM had a very big accounting problem with the 100 or so independent labels signed directly to SiriusXM. That problem was resolved by SiriusXM forcing those independent labels that were incorrectly accounted to pay back in cash or by SiriusXM recouping against future payments the overpayments made to those labels thereby substantially reducing the labels on going income from SiriusXM. To fix this accounting mess, SiriusXM was forced to contact each label and explain the situation. They realized it would be more economical in the future to deal with one or two representatives rather than 100.

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