[Video] Demystifying Black Box Royalties – Practical Solutions For Unlocking Your Royalties

Dae Bogan
Dae Bogan
Industry Insights
September 27, 2018

Today, TuneRegistry's CEO and Royalty Claim's founder, Dae Bogan, conducted a webinar and product demo hosted by the Music Business Association. Below is a video recording of the full webinar and below it are post-webinar answers to questions submitted by webinar attendees.

Webinar Description: The global music licensing ecosystem is ripe with inefficiencies, complexities and legal mumbo-jumbo that affects the livelihood of music creators and copyright owners when royalties become trapped. The idea of not being paid when your music earns royalties is frustrating. Some would even call it highway robbery! But there are some practical solutions that every interested party in music royalties can put to use immediately to ensure that your music industry administration operations get you paid. This webinar will demystify so-called “Black Box” royalties and demonstrate how rights-holders can leverage technology to combat this global issue.

For Pie chart of "Unclaimed Royalties" found by Royalty claim, these are the # of unclaimed royalties. Any insight into which bucket has the highest $$ value? Unfortunately, the value of unpaid royalties is not published by music rights organizations. Therefore, Royalty Claim does not have that information. However, we are starting to collect some information on the value of unpaid royalties by asking claimants to report back to us (by updating their claim in their account) the amount received from any retroactive royalties payment upon successful resolution of a claim.

Hi. May I ask where the figures of the total black box estimation (ex: $100M for mech rights in interactive streaming) come from? The value of the black box is at best speculative. Depending on your source, a projection must take into account what territories are being included, what rights are being included (unpaid mechanical royalties, unpaid performance royalties, unattributed master royalties, unpaid audiovisual royalties, etc.), which group of income participants are included (e.g. featured performers, non-featured performers, sound recording copyright owners, composition copyright owners, etc.), and so on. The value of all black boxes combined from all rights in all territories is estimated to be in the billions of dollars.

How is Royalty Claim different from another 3rd party such as Songtrust? Royalty Claim is a research initiative into the global music licensing ecosystem. As an information source, Royalty Claim provides a searchable database of unclaimed music-related entitlement records that can be searched and claimed by the eligible interested party. Royalty Claim is not a music publisher, record company, or rights administrator. Songtrust is a music publishing administrator that represents the administration in music compositions on behalf of songwriters and publishers. Songtrust registers works with music rights organizations, collects royalties and pays its writer and publisher clients.

Didn't all of the Major Labels declare in June of 2015 that they share 'breakage' of advances/minimum guarantees with their artists, so there's no black box there? Yes, major labels made this announcement. However, how is this being verified? Are all artists receiving payouts, including artists signed to independent labels that are distributed by major labels? This is still uncertain.

Within RoyaltyClaim, what is the purpose of the Daily Pass? If you have a paid membership, do you still need to purchase a pass every day that you want to make claims on your blackbox royalties? The Open Search Day Pass enables a user to search unlimited keywords. The Open Search Day Pass is an add-on option, which could be useful for a user with a low keyword allotment plan such as a Free account (2 keywords) or Basic account (5 keywords). Learn more at here.

If we make sure to have our songs registered with The Copyright Office, then can they still issue these NOIs? According to the United States Copyright Act, if a copyright owner has registered his/her/its work with the Copyright Office and has current information identifiable in the public records of the Copyright Office, then a music user should deliver the NOI (a statutory notice) directly to the copyright owner. Then, the music user music account to the copyright owner and pay mechanical royalties. The problem is, in some cases, this is not happening. The bigger question, though, is the validity of this policy given the stipulations of the Berne Convention, which holds that a copyright owner does not have to register his/her/its works to receive the benefits of copyright ownership (which would include the rights to reproduction and the obligation of proper licensing and accounting of royalties). For more on this, see our Google investigation.

My understanding is that an artist needs to have residence in a foreign country to collect neighboring rights for public performance of their sound recordings outside the US. How is it that you are able to collect these monies on behalf of a US-based artist? This is a common misconception. First of all, SoundExchange will collect foreign digital radio royalties for its artist and copyright owner members from CMOs with which it has a reciprocal agreement (including the 62 members of SCARP). SoundExchange pays its members these foreign royalties. With a TuneRegistry account, artists and copyright owners can easily deliver its recording registrations to SoundExchange from within the Registrations module. That being said, SoundExchange does not have agreements with all CMOs. In this case, copyright owners can directly affiliate with foreign CMOs to collect the copyright owner (label) share (50%) of neighboring rights royalties. It is much more difficult for a performer to affiliate directly. In some territories, the CMO only pays out to citizens (e.g, Australia, Israel, Japan). In other territories, the performer would need the assistance of a neighboring rights agent.

Are you delivering the data to the PROs via EBR or CWR? TuneRegistry delivers registrations and metadata to a growing network of partners in a number of methods and formats including EBR, DDEX, CSV, API, and Email. We do not deliver CWRs at this time, but will be in the near future.

I'm an attorney, can I register with Royalty Claim and search for my clients' royalties? Yes, attorneys currently use both TuneRegistry and Royalty Claim on behalf of their clients. Both allows multi-user accounts for scenarios where an attorney and the client need to co-manage the account.

Are there plans to link data from Tune Registry to and from Royalty Claim? To be determined.

Is TuneRegistry free? TuneRegistry and Royalty Claim both offer free accounts. TuneRegistry's free account is for catalog management only. You cannot initiate registrations on the free plan. Royalty Claim free account enables you to search, find, and claim entitlements using up to 2 keyword, which can be changed once every 30 days.

Why is the money unclaimed when you can see it was David Guetta's song? Royalty Claim provides data regarding unclaimed music entitlements. We do not provide information on why an individual party may have not chosen or been able to claim the entitlement. There are many reasons why unpaid, unattributed, and unclaimed entitlements exist. In this case, it could be because the performer has not been registered with the CMO that has earned royalties held against the sound recording.

What would happen to the catalog metadata and song registrations if I used TuneRegistry to manage my catalog but then decide to cancel my account? If you decided to can your TuneRegistry account, you can download your catalog before cancelling. Registrations and data delivered to our network partners prior to cancellation would not be affected.

For more TuneRegistry Q&A, visit our FAQ page.

For more Royalty Claim Q&A, visit our FAQ page.

Create a FREE account today with TuneRegistry and Royalty Claim and enhance your music administration operations.


Photo by Jimi Filipovski on Unsplash

Dae Bogan

Dae Bogan is the Co-founder & CEO at TuneRegistry; a music rights and metadata management platform for the independent music community. Dae is also an educator at the University of California, Los Angeles (UCLA); California State University, Northridge (CSUN); and SAE Institute Los Angeles (SAE) where he teaches music business and music industry entrepreneurship.

Join our newsletter to get updates and industry insights: