Label services and distribution company AWAL is now offering complete and transparent distribution of Spotify stock payouts to the artists and labels it represents.
If you’re unfamiliar with AWAL, it’s an indie/unsigned distribution and label services company that handles behind-the-scenes for its clients. Those tasks include distribution to streaming services, metadata compliance, marketing, digital analytics, and broader distribution chores. In return, the company takes 15% of the total revenues.
AWAL’s portion of the Spotify stock cash-out has now been made available to them to distribute. Earlier today (Wednesday), the company has sent out an email informing members how it will handle payments going forward. The email was snagged by LA-based artist (and Digital Music News writer) Ari Herstand, who was pretty thrilled to receive the notice.
The down-to-business email offers a clear, transparent process for distributing all Spotify payouts received.
AWAL’s payment came via Merlin, the powerful collective representing indie interests in a range of licensing discussions, including those with Spotify. Merlin initially negotiated an equity stake in Spotify, and subsequently cashed out 100% of its SPOT holdings to pay out its members.
The Merlin distribution was also clear-cut, with collective CEO Charles Caldas quickly distribution the cash to members. Now, that money is flowing downstream.
Meanwhile, shares of SPOT are hitting the $190 mark and possibly crossing $200, if bullish analysts prove correct. But thinking among Merlin (and Caldas) was that the organization’s remit simply isn’t playing the market. It’s distributing money back to its members are quickly and efficiently as possible.
The email (full copy below) states that the company plans on distributing the funds pro-rata between all clients based on information provided by Merlin.
That means if an artist was responsible for 2% of the total Spotify royalties received, then that’s the amount that the artist will receive. The caveat here is that the data between September, 2012 and March, 2018 are the cut-off dates for the cash redistribution to artists.
AWAL has also stated that artists will see share proceeds on June 2018 statements, with payments being made sometime in mid-August. Full details for the distribution will be included in the statement issued to artists, and AWAL urges anyone with questions regarding the income to ask questions.
Of course, AWAL’s approach to this redistribution is likely to further its appeal to would-be clients and partners. AWAL is part of Kobalt Music Group, which also enjoys a stellar reputation for transparency and strong royalty accounting and delivery.
Here’s the complete letter below.
Re: Spotify Share Income Distribution
Understand how this affects you.
We are very happy to be able to share details with you of how AWAL will distribute the income it has received as a result of the sale of Spotify shares by Merlin, the global digital rights agency for the world’s leading independent music companies.
Merlin sold its Spotify shares shortly after the streaming service went public on the New York Stock Exchange on April 3rd. Merlin has now allocated those proceeds, pro-rata, to its members, including AWAL, based on the value of Spotify royalties each member received during the period of Merlin’s agreement with Spotify. That means we can now share AWAL’s portion with you.
We will be distributing this income to clients in the same fair and transparent way in which we distribute all income we receive on behalf of clients. With this in mind, we’d like to briefly break down how this distribution is being calculated and paid out to clients.
• The relevant accounting period begins on September 1st, 2012, when AWAL joined Merlin’s Spotify deal and ends March 31st, 2018, the end of the last month before Merlin sold its Spotify shares.
• We are allocating AWAL’s share of the proceeds pro-rata between all our clients using information reported to us by Merlin at a recording level.
• In other words, if an AWAL client’s recordings were responsible for two percent of all AWAL Spotify royalties between September 2012 and March 2018 then that client will receive two percent of our portion of Merlin’s share proceeds.
• The Spotify share proceeds will be credited within our June 2018 statements, which will be distributed to clients in mid-August.
• Full details will be included in your statement. The revenue will be reported under the description ‘Pro Rata Share of One-Off Income’ and will be commissioned at the same rate as digital distribution income.
Don’t hesitate to reach out and ask any questions you may have.