New Copyright Royalty Board ruling requires streaming services to give 15.1%, up from 10.5%, of revenue to songwriters and music publishers over next five years
(Reuters) - U.S. copyright authorities on Saturday decided to increase over the next five years the royalty payments music streaming companies …
Context & Ripple Effects
This ruling is the climax of a rate fight the board has been resetting every few years as streaming becomes the industry's core business — streaming passed downloads as the top source of US recorded-music revenue back in 2015, and the board responded by lifting Pandora's per-song payout that same cycle (17 cents per 100 songs, up from 14). Publishers and songwriters then pushed for a bigger structural change: a share of services' total revenue rather than per-play pennies, against resistance like Apple's proposed flat 9.1¢-per-100-streams rate.
The 15.1% headline number matters because it sets the floor for the next negotiation round — when the following period came up, the same parties avoided another legal war by settling at 15.35% for 2023–2027, barely above this ruling's level.
First-order effects
- Spotify, Apple, Amazon, Google, and Pandora see their largest songwriting cost line jump roughly 44%, from 10.5% to 15.1% of US revenue, effective across the next five years.
- Songwriters and music publishers gain a materially larger slice of a revenue pool that was already growing as streaming displaced downloads.
Second-order effects
- Services facing thinner margins on subscription economics have an incentive to keep pushing flat per-stream proposals like Apple's, since fixed per-play rates grow slower than revenue-share rates when streaming revenue accelerates.
- Publishers, having won a near-50% increase from the board, enter the next rate period with leverage — which is exactly why the eventual follow-on was negotiated down to a settlement rather than litigated again.
Third-order effects
- If each five-year proceeding ratchets the publisher share upward while streaming keeps expanding, the Copyright Royalty Board becomes a recurring structural tax on streaming margins, shaping which services can profitably operate at scale.
- The shift from per-play to revenue-percentage royalties hardens into the standard bargaining frame between rights holders and platforms, with each cycle's outcome anchoring the next.
The trend: As streaming became recorded music's dominant revenue engine, US songwriting royalties migrated from per-play rates toward revenue shares set in five-year Copyright Royalty Board cycles, with each ruling anchoring the next negotiation.