If you thought VEVO was too good to be true, you might be right ― especially if you're an indie. According to a troubling critique from Songs Music Publishing CEO Matt Pincus, VEVO is sytematically skipping payments to indie publishers. The bilk seems to be happening through highly-inclusive deals involving Vevo's major label, joint venture partners, according to the Pincus' op-ed (published in the Wrap).
Digital Music News contacted VEVO immediately after the Wrap published the piece. VEVO emailed us back, but declined any comment. The allegations, if true, would help to deflate a recent announcement that VEVO is now making $150 million in revenues annually, with more than $200 million going back to artists since inception.
Sounds great for VEVO and its partners, though Pincus says the fun stops there for Songs and other indie publishers and songwriters.
VEVO largely revolves around major label content, which makes sense given its major label joint venture partners. But that doesn't mean indie publishers and songwriters aren't penning some of the tracks. And, if majors sign all inclusive (recording+publishing) deals, majors are essentially saying they'll pass these payments through. And according to Pincus, they aren't.
Actually, Pincus goes further to say that his content is oftentimes licensed without his permission, without any payments attached (apparently they don't invite you to the Christmas party, either). "Synchronization licenses are not compulsory," Pincus notes. "Yet, labels are doing it anyway. I see uncontrolled songs that we publish in videos broadcast on Vevo, and we are not getting paid for that."
But wait: the situation gets even more absurd, according Pincus, because Songs Music Publishing and other indie labels actually have direct licensing arrangements with YouTube. Which means that when VEVO isn't involved, they get paid, but when VEVO is serving the content, they aren't. "To illustrate, my company publishes a current top 10 song, 'Rack City,' performed by the rapper Tyga," Pincus continued. "We are getting paid directly from YouTube for a video that a kid made of himself lip-synching the song with his grandmother dancing in the background.
"Somewhat nonsensically, we are not getting paid from the official video featuring Tyga that was produced by Universal Records. Seems illogical to me."
The full Wrap op-ed is here.
Comments Closed
Weird Monday, February 06, 2012
The bilk seems to be happening through highly-inclusive deals involving Vevo's major label, joint venture partners.
Sounds like another new streaming platform we keep hearing so much about.
tippysdemise Tuesday, February 07, 2012
does anyone actually know the precise amount of the royalty generated by a video stream? if so, would you please quote it for us here?
mnew Tuesday, February 07, 2012
There isn't a set rate it varies a fair bit. There are different rates for example for UGC.
tippysdemise Tuesday, February 07, 2012
understood - but this is essentially my point.
This Should Help Tuesday, February 07, 2012
Broadcasters Per Performance Royalties
2011 - $.0017 per performance
2012 - $.0020 per performance
2013 - $.0022 per performance
2014 - $.0023 per performance
2015 - $.0025 per performance
Statutory Webcasting Per Performance Royalties
2011 - $.0019 per performance
2012 - $.0021 per performance
2013 - $.0021 per performance
2014 - $.0023 per performance
2015 - $.0023 per performance
Pureplay Webcasters Per Performance Royalty
2011 - $.00102 per performance
2012 - $.00110 per performance
2013 - $.00120 per performance
2014 - $.00130 per performance
2015 - $.00140 per performance
As set out below in detail, there are significant differences in the royalties paid by different services for the 2011-2015 royalty period. Broadcasters who are streaming their programming on the Internet pay lower per performance royalties than webcasters paying the statutory rate in the first years of the 5 year period, but higher rates at the end of the period. (See a summary of the Broadcaster royalty agreement here). "Pureplay" webcasters, like Pandora, pay significantly lower per performance royalties than either broadcasters or those paying under the statutory rate, but are required to pay a minimum fee of 25% of the gross revenue of their entire business - ruling out these lower rates as an option for any service that has lines of business other than webcasting. (See a summary of the Pureplay deal here). The broadcaster deal and that which applies to the Pureplay webcasters were both arrived at pursuant to settlements reached under the two Webcaster Settlement Acts, passed in 2008 and 2009. These allowed the groups covered by these agreements to negotiate with SoundExchange over the rates that would cover the industry for the digital noninteractive performances of sound recordings. The statutory rates were arrived at by a decision of the Copyright Royalty Judges after litigation which took place last year.
@phonobase Tuesday, February 07, 2012
As usual.
@kristiannergard Tuesday, February 07, 2012
This is some disturbing stuff about VEVO.
@Awesomeosity Tuesday, February 07, 2012
This is why I started INDMUSIC.
PROs listening? Tuesday, February 07, 2012
I wonder what BMI, ASCAP and SESAC have to say about this fiasco?
derek Tuesday, February 07, 2012
So Vevo needs to report and pay to the label; the label needs to report and pay to the publisher. Youtube indicates that video was posted on 1/10/12. Maybe the reason this publisher hasn't been paid is because it's too early in the accounting cycle? I'm not sure what the UMG cycle is, but I can guess it would be anywhere from monthly-net 30 to quarterly net-45.
MisterSoftee Tuesday, February 07, 2012
Hey Vevo why not respond? This just makes you look guilty as charged.
@jamiedoesmusic Wednesday, February 08, 2012
#uhohspaghettios
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