Business

SoundExchange Paid Out $947 Million in 2020

Soundexchange
Courtesy of Soundexchange

            

Revenue collections crossed the billion dollar mark during the pandemic year

SoundExchange distributions grew 4.3% to $947 million in 2020 from $908 million paid out a year earlier to artists, record labels and other creators with points on master recordings.

Overall revenue collections totaled $1.003 billion in 2020, a 4.2% increase over $963 million pulled in for the prior year.

"Music was among the industries hit hardest by the COVID-19 pandemic," SoundExchange president & CEO Michael Huppe, said in a statement. "With venues shuttered and touring revenue effectively non-existent, digital royalties represented the lifeblood and primary income source for a large segment of the music industry."

SoundExchange collects and distributes digital performance royalties on behalf of nearly 250,000 recording artists' and master rights owners' accounts. Last year the company paid out 94.4% of its collections from webcasters (like SiriusXM and iHeartMedia), which was up a tick from the 94.3% it achieved in 2019.

"It is a testament to our technology and data systems and point of great pride that SoundExchange was able to continue to deliver on-time and seamless payments to creators throughout 2020," Huppe added in a statement. "I'm especially pleased that last year's payouts were so robust at a time when creators needed them the most."

Overall expenses grew slightly to $58 million, up from 2019's $57 million. The organization said its operating expense ratio was 5.3% in 2020, but that's after deducting interest payments earned on collections.

Otherwise, overall expenses equaled 5.8% of revenue.

According to its financials, statutory collections totaled $794 million in 2020, so that means SoundExchange also handled $209 million in royalty payments from services that had direct licenses with sound recording owners.

"I'm especially pleased that last year's payouts were so robust at a time when creators needed them the most," Huppe said.

SoundExchange says it has distributed nearly $8 billion since the organization's establishment in 2003.