Publishing News

Copyright Royalty Board Greenlights Royalty Increase for 2024

Jan 4, 2024

Exciting developments are unfolding for songwriters and publishers in 2024 as the Copyright Royalty Board grants approval for an increase in royalties for both physical and digital music sales. While this news may seem distant, its implications could extend far and wide.

Let’s break it down:

Shift in U.S Mechanical Royalties:

The recent decision by the Copyright Royalty Board to raise the U.S. statutory mechanical royalty rate from 12 to 12.40 cents signifies a significant change in how songwriters and publishers are compensated. Notably, these increased royalties diverge from conventional streaming platforms like Spotify, Apple Music, or Amazon Music. Instead, this system involves direct payments from record labels.

Mechanical Royalties in South Africa:

In the South African context, mechanical royalties play a crucial role in compensating songwriters for the sale, download, or streaming of their music through on-demand streaming services. Unlike the U.S. model, where record labels are the source of payment, in South Africa, digital service providers such as Spotify or Apple Music are solely responsible for paying mechanical royalties to artists.

CAPASSO: Navigating Mechanical Royalties in South Africa:

Composers, Authors, and Publishers Association (CAPASSO) operating as a mechanical rights licensing agency in South Africa, serves as a central figure in this landscape. This organization plays a pivotal role by licensing, collecting, and distributing mechanical royalties exclusively to its members, encompassing music publishers and composers. In this way, CAPASSO contributes significantly to ensuring fair compensation within the South African music industry.

Advocacy and Collaboration: A Lesson for South African Artists:

The journey toward the U.S. mechanical royalty rate increase involved advocacy from independent songwriters and organizations. South African musicians can draw inspiration from these efforts, emphasizing the importance of collective action in shaping fair compensation structures. Local artist associations and individuals, like those in the U.S., can play a pivotal role in advocating for the rights of South African artists.

Exploring Opportunities: Signing with U.S. Record Labels:

Given that the increase in royalties for both physical and digital music sales involves payment from record labels and not streaming platforms, South African artists looking to benefit from this royalty rate increase may consider the option of signing with a U.S. record label. This strategic move could open doors to enhanced compensation and global exposure.