At a recent lunch with Stephen and Leyla Hill of the Hearts of Space Radio Show, they were shocked to hear that Magnatune has not registered our artists with Soundexchange.
The reason, is that Hearts of Space itself pays a lot of money to Soundexchange for the right to play their decades of radio shows over the Internet. Hearts of Space charges about $10 a month for access to those shows, and it's a good business for them, and it's legal since they pay Soundexchange for that right. Hearts of Space also sends in track-by-track data to Soundexchange, which Leyla tells me isn't required, but is really appreciated by me because it allows musicians to be paid every time their song is played on Hearts of Space, rather than using some aggregate system where more obscure genres and indie musicians always seem to lose out.
Magnatune has the legal right to license the Internet performance right to other organizations, as well as the right to sublicense that right. That allows us to grant Soundexchange the right to collect Internet broadcast royalties.
How this plays out with Creative Commons and podcast safe music is interesting.
My understanding, is that if a podcast uses nothing but Magnatune music, they are not legally obligated to pay Soundexchange, since we grant a podcast waiver. However, if they mix Magnatune music with other non-podcast-safe music, then to be legal they need to pay SoundExchange (this is in the USA only, I'm talking about), and in that case, Magnatune gets its piece of the fees SoundExchange collects, which to me is the best of both worlds.
Last week, I went over all the legalese and filled out all the forms, and sent it all off to SoundExchange. Despite their nice web site and database, registering with SoundExchange is an all paper process, and I guess they have a bank of typists entering the artist names that I attached to our agreement with them.
SoundExchange also publishes a 16,000 name long list of "artists we owe money to and don't know how to reach". I ran a match search against the Magnatune artist list, and only found one match. I'm guessing this is because SoundExchange really isn't collecting much from indie source, such as podcasts and independent shoutcast statsions. SoundExchange probably is collecting mostly from FM radio stations that broadcast on the internet, and those, naturally, don't play much magnatune music (yet)
At any rate, regardless of how much (or little) money SoundExchange ends up paying us, I feel it's the right thing to do for our musicians, as it's another possible little revenue source, and something a record label should do for its musicians.