This Technology Could Help DJ-Producers Collect Millions in Missing Royalties
New technology could help songwriters collect missing public performance royalties from DJ sets.
Many up-and-coming dance music creators say that hearing one of their songs during a festival set is a dream come true. For those with writing credits, however, collecting the public performance royalties can be a nightmare.
Every time a DJ plays a track by another artist during a live set — whether at a massive festival or a tiny nightclub — the songwriter and publisher of that track are entitled to public performance royalties. (The same goes for music played by garden-variety wedding or bar mitzvah DJs.) This money is paid out from the license fee paid by the festival promoter or venue to PROs, or performing rights organizations. These PROs — which in the United States include ASCAP, BMI, SESAC and GMR —monitor public performances of their members’ compositions at licensed venues, then compensate members out of the money they collect.
In the world of dance music, however, that process gets tricky. Because DJ sets typically feature many different songs by many different artists and writers — often remixed, altered in pitch or sampled only briefly — PROs have a harder time monitoring what gets played. As a result, collected fees often end up in the wrong hands — or not paid out at all. In 2016, the nonprofit Association for Electronic Music (AFEM) projected that dance music producers missed out on an estimated $120 million in royalties from live performances.
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Now, a number of music recognition technologies (MRTs), including BMAT, YACAST and Pioneer’s KUVO, can make the monitoring and reporting of DJ sets easier and more accurate. One of them, the Amsterdam-based DJ Monitor, functions much like Shazam, identifying tracks within its library — a database of nearly 80 million songs submitted to DJ Monitor by PROs — and creating setlists with 93% accuracy, the company reports. MRT companies make money by selling data to PROs.
MRT has been widely adopted throughout Europe and Australia, where the dance music industry has historically been robust. So far, though, U.S. PROs have not followed suit. Instead, stateside PROs determine live performance royalties using two methods. The first is estimating what’s played at any given club or festival based on songs performed on top-grossing concert tours, in other selected major venues and on the radio. Given the niche nature of many dance genres, however, these estimates seldom reflect what’s actually being played.
“When you’re talking about electronic music, where people are going out to hear drum-and-bass or techno, there’s no correlation at all between what’s played [in a DJ set] and on the radio,” says AFEM GM Greg Marshall. “That’s why it’s an issue for electronic music more than any other genre.”
The second method: PROs also collect fees based on setlists submitted manually by DJs after each set, a straightforward yet tedious piece of housekeeping many ignore. It’s common for artists to simply submit a list of their own music when asked, if they’re even asked at all: One manager for an electronic music act tells Billboard that while European events routinely request setlists, U.S. festivals never do.
DJs with big radio hits are more likely to report their sets, given that royalties for these songs are more likely to be accurately tracked by traditional PRO methods. But artists can’t access money that PROs don’t track, so the process is harder for lesser-known songwriters and publishers. “Without MRT,” says DJ Monitor CEO Yuri Dokter, “it is almost impossible to pay rights holders correctly.”
Currently, no U.S. PROs have formally partnered with an MRT company, though DJ Monitor is starting a pilot program for an undisclosed U.S. PRO. While festival promoters and club owners do not pay more in licensing fees when an MRT is installed, Marshall believes that as certain U.S. PROs control less dance music repertoire than others, along with the massive size of the country, not all PROs are incentivized to update their methods. Meanwhile, Dokter says U.S. songwriters and publishers are generally unaware of MRTs that would help them collect more accurate royalties.
Progress is being made internationally, however, with major festivals including Tomorrowland, Parookaville, Timewarp, Sonar and most Dutch events all under contract with DJ Monitor. The Netherlands is a worldwide leader in accurate royalty collection, given the size of the country’s dance industry and its financial importance to Dutch PROs Buma/Stemra and Sena. Australia, the United Kingdom and France are also catching up with MRT, with PROs in Peru, Guatemala and beyond following suit. Says Dokter: “We feel that every [PRO] has a moral obligation toward their members, authors, artists, labels and publishers to use the best technology available on the market.”
This article originally appeared in the March 14, 2020 issue of Billboard.
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