Streaming has rejuvenated the music business, but it’s no secret that the new economic model has upset many in the industry. And no group has been more frustrated than songwriters.
In a physical sales-driven world, writers could make a decent living by landing a placement on a superstar’s album whether it resulted in a hit or not — every song on a million-selling album earns the same amount of mechanical royalties, most recently 9.1 cents per copy sold. In the streaming-driven world, however, album placements no longer guarantee much income. There are only hits and non-hits, and the streaming money a writer earns from penning a couple of the latter, even if a superstar records them, “might not even equal the cost of filling up my gas tank to come to the session,” says Dan Petel, whose management company This Is Noise looks after Ian Kirkpatrick (a writer on Dua Lipa’s “Don’t Start Now” and “New Rules,” as well as hits from Selena Gomez and Jason Derulo), Simon Wilcox (Demi Lovato, Camila Cabello) and others.
“The truth is that the large majority of songwriters are writing for free five days a week with a very low batting average [in terms of getting songs placed],” says Zach Gurka. His Ground Up MGMT roster includes Emily Warren (Lipa, Charli XCX) and Scott Harris (Cabello, Shawn Mendes), and Gurka’s job — “to get your average writer to a living wage at the end of the year” — “involves a scavenger hunt to find money in different places.”
In an effort to counteract this harsh economy where artists and labels pull in the majority of money paid out by digital streaming platforms, Petel, Gurka and their peers are upending music-industry norms as they devise new ways to get their clients paid. Instead of praying for back-end royalties, songwriter managers are increasingly asking for payments throughout the writing and recording process: fees that can include upfront money to enter the studio with an artist; holding fees to reserve tracks for a set period; a kill fee if, for example, a label doesn’t push a single to radio; and, in some cases, a percentage of royalties generated by the recording, which songwriters traditionally have not been granted.
Collectively, these fees can add up to anywhere from a few hundred dollars to the high five figures for in-demand writers.
Every ask can be a risk — push someone too aggressively, and potential clients might opt for a less demanding songwriter. “It’s so easy to sour relationships by asking for too much,” says Kelle Musgrave Glanzbergh, whose Linear Management roster encompasses over a dozen writers, producers and mixers.
Songwriters have historically drawn on several streams of income: mechanical royalties from downloads, physical sales and, to a lesser degree, streams; performance royalties, which flow from radio play and streaming; and synch fees from placements in ads, TV shows or films. Today, writers can no longer rely on mechanical royalties from physical sales and downloads to provide much revenue. Labels aren’t typically open to input from songwriters when it comes to promotion or synch placements. And the number of writers and producers on many pop songs dilutes the income of each even further.
For Gurka, requesting a hold fee “is the earliest point to ask for something.” Artist managers or A&R executives often hear demos and want to reserve them for a future project, at which point, he explains, “There’s an opportunity to say, ‘We will not pitch this to others for three to six months while you figure out what you want to do. But in exchange, can we have some sort of fee for that time?’ ” He says hold fee requests often range from $5,000 to $20,000.
More songwriter managers are also asking for royalties from songs that are destined for release. While writers enjoy publishing income when their lyrics or melodies are used, they are not typically entitled to a share of the income stream from the released recording unless pieces of their demo — bits of guitar, for example — are used in that recording. Petel says he will often push for 1% of recording royalties for his clients in situations where an artist wants a song but was not involved in writing it.
The same goes for situations in which a writer plays a large role in an album project, setting aside multiple days to help create songs and placing several tracks on the record. “There’s not much money in album cuts unless you can get a fee and some sort of recording royalty,” Petel says.
While getting a point on the recording is an accomplishment, it does not guarantee money for writers. Often they will not receive any royalties until the costs of recording and promoting a song are recouped. That’s why asking for upfront fees matters, according to Musgrave Glanzbergh. She finds that “when the majors are blocking out a chunk of time for writers to work with an artist, it’s easier to get maybe a $500 day rate [for my clients].”
In some situations, Gurka has asked for kill fees if artists and labels appear hesitant to push a single up the charts. “If a song goes to pop radio, we make money [through performance royalties] — can we put that in writing?” he asks. “Can we put a kill fee in there in case the song doesn’t have an impact date or doesn’t reach a certain number on the [radio] chart?” A kill fee ask tends to be higher — potentially $50,000 or more — under the assumption that the money won’t be paid if the label fulfills its obligations.
The shifts in writer compensation are currently centered in the top 40 pop space, but the Nashville songwriting community is taking note as well. “Los Angeles is often five years ahead of us,” says Robert Carlton, senior vp of development at SMACKSongs, which has a roster of 20 country writers that includes hitmakers Shane McAnally and Josh Osborne. But “young writers are definitely unsettled. [They’re asking,] ‘Did I miss the last window where I could actually make a significant living doing this?’ There’s more of an onus on the artists and the labels — you have to help out here.”
In 2019, country singer Kip Moore spoke about paying bonuses to songwriters who appear on his albums to ensure they are fairly compensated. But even in Nashville, where songwriters are highly valued, paying them more means that someone else is making less. “Whenever you try to make that status quo shift, there is going to be a pushback,” says Gurka. His requests for compensation are often met with “an eye roll.” Gandhar Savur, an entertainment attorney who represents writers and artists, says writers’ asks have elicited “anger, shock [and] surprise,” partially because “these points that writers are now asking for are coming out of the artists’ royalties — the labels are not sharing in this burden.”
Artists are already expected to pass some of those royalties to their producers and mixers. An act with an 18-point royalty, for example, may actually wind up with 13 points once collaborators’ shares are allotted. That drops further if songwriters are added. Several artist managers say it’s not fair for their clients to shoulder the burden of paying songwriters, believing it should fall to labels and even digital service providers.
If writers increasingly secure recording royalties for their work, Gurka hopes that labels — which typically earn far more points than their artists — will change their contracts accordingly. But artist managers note that labels are reluctant to set such a precedent. “Most companies will say, ‘We can’t give you a point, but we can give you a few grand,'” says Hannan Malik, founder of Nowherenear and manager of Plested (Lewis Capaldi, Little Mix) and others. He adds, however, that a label could gain a competitive advantage by being more generous with songwriters. “If a company said, ‘We’re going to give a point to everyone,’ they’re going to get the best songs,” he says. “The more we ask, the more likely it becomes the norm.”