Industry Payouts, AI Controversy, and Radio Royalties
How The Music Business Works - Issue #1
February 27, 2025
Welcome to the very first issue of How the Music Business Works, your go-to source for the latest insights and developments in the music industry! Whether you’re an artist, songwriter, or industry professional, staying informed is key to success—and we’re here to help you navigate the ever-changing music business.
This newsletter is brought to you by Music Admin, a company dedicated to helping artists, songwriters, and rights holders take control of their royalties and music rights. We understand how complex the industry can be, from performance and mechanical royalties to licensing and publishing administration. That’s why we’re committed to making the process easier, ensuring you get paid what you deserve.
Each week, we’ll break down the biggest stories shaping the industry, giving you the knowledge you need to make informed decisions. From royalty collections to streaming trends, legal battles, and emerging opportunities, we’ve got you covered.
At Music Admin, we don’t just report on the business—we help you succeed in it. Want to make sure you’re maximizing your earnings? Learn more here.
Thank you for being part of our community. We’re excited to take this journey with you!
-The Music Admin team
SoundExchange Surpasses $12 Billion in Distributions
SoundExchange has reached a major milestone, surpassing $12 billion in royalty distributions to artists and rights holders since its founding in 2003. In 2024 alone, the U.S. performance rights organization paid out $1.05 billion, marking a 4.9% increase from the previous year. Serving over 700,000 creators, SoundExchange remains the sole entity authorized to collect Section 114 royalties from non-interactive digital services like SiriusXM and operates globally through nearly 60 partnerships. CEO Michael Huppe has overseen a significant expansion in collections, with revenues from satellite services up 711%, subscriptions up 294%, and non-subscription services up 215%.
Radio Royalties Back on the US Congressional Agenda
The U.S. Congress is once again revisiting the long-standing debate over AM/FM radio royalties. The American Music Fairness Act proposes requiring radio stations to pay royalties to artists and record labels for airplay, aligning the U.S. with global standards. However, the National Association of Broadcasters (NAB) is backing the Local Radio Freedom Act, which seeks to maintain the current system where stations pay nothing for music use. The music industry, led by figures like Recording Academy CEO Harvey Mason Jr., argues that American artists have been denied fair compensation for over a century. Meanwhile, NAB CEO Curtis LeGeyt warns that additional costs could impact local radio’s ability to provide essential services.
The FCC Scrutinizes Payola Practices at iHeart Festival
The Federal Communications Commission (FCC) is increasing its oversight of potential payola practices, warning radio broadcasters that pressuring artists to perform at station events for free in exchange for airplay may violate federal law. FCC Chair Brendan Carr has requested details from iHeartMedia regarding artist compensation for its upcoming iHeartCountry Festival in Austin, Texas. While iHeartMedia insists its practices comply with legal standards, the inquiry highlights ongoing concerns about fair industry practices. With regulatory scrutiny on the rise, broadcasters may face heightened pressure to ensure transparency in artist agreements.
UK Government Considers AI Training Concessions Amid Industry Backlash
Following significant protests from the creative sector, the UK government is reconsidering its proposed ‘opt-out’ model for AI training on copyrighted works. A silent album released by over 1,000 artists underscored concerns over unauthorized use of creative content for AI model training. As a result, ministers are reportedly working on key concessions to better protect British artists and rights holders. This move reflects broader industry resistance to AI’s impact on intellectual property, with many calling for stricter protections against unauthorized use of copyrighted material.
Spain’s Music Market Sees 9.4% Growth, But Physical Sales Decline
Spain’s recorded music market grew by 9.42% in 2024, generating €568.8 million in revenue. Digital sales drove this expansion, accounting for 89% of the market, with streaming making up nearly all digital revenue. However, physical sales saw a double-digit decline, dropping 13.25%. Vinyl, which made up 62.8% of physical sales, experienced an 8% decrease in units sold, while CD sales plummeted by 25.4%. Piracy remains a significant challenge, with 30% of music consumers engaging in unauthorized use, resulting in estimated losses of €628 million.