As the music world continues to sail into uncharted technological and political waters as consumers flock toward streaming, Kobalt Publishing has been tuning into developing lucrative microcurrents of musical royalties.
Tiny, tiny little currents of online music can add up to real money. But how to find them all in such a vast sea of data?
The digital music publisher focuses on minute digital transactions (streaming, downloading, online videos) from all over the Internet to locate royalties for clients (much like MAM does with commercials). Kobalt’s aim is full transparency, and tracing 100% of their clients’ royalties back to their source for collection.
Though the company’s roots are deeply tech-oriented, Kobalt started gaining its sea legs in the music world over 15 years ago as a publishing company, representing the likes of Paul McCartney, Gwen Stefani and Beck.
Moby (also a client) sees Kobalt’s data-crunching approach as its unique strength within the music industry: “Kobalt is more like a tech company than a music company. As a result, no one ever told them to steal from their artists.”
Kobalt’s founder, Willard Ahdritz, sees the international music industry as unwieldy, archaic, and in need of a remedy. So he’s turned his eagle eye to tech-crunching nothing less than the global music royalty market.
As you’ve likely noticed, the wait from performance to payment on international royalties is lengthy and tedious for artists. Each country has its own database and its own society, adding complexity to the payment tracking process and exposing a song’s performance to potential errors, tedious fees, and additional taxes.
Most PROs–domestic and international–long-ago build their pay out structure based on traditional broadcasts via TV and radio. It was a complex system to create, and there’s been minimal movement by PROs to tackle smaller performance royalties lurking in the murky depths of digital media. But they’re there, performing on websites and I.P. addresses all over the world, waiting to be collected on once they’re found.
That’s Kobalt’s quarry—diving into the depths of digital media for performances, and then untangling their royalties from the ‘archaic’ international PRO system so artists can see real cash for their work.
Kobalt’s bold first move: creating a global digital PRO via the purchase of American Mechanical Rights Agency (AMRA), now renamed to American Mechanical Rights Association (still AMRA).
The next step: use AMRA as a catch-all PRO for songs directly uploaded and registered globally, bypassing the clunky-and-costly process of collecting from foreign PROs.
By minimizing international costs and fees, AMRA can increase royalties artists ultimately collect by omitting unnecessary transaction fees. ‘One Tech-Friendly PRO to Rule them All’ would also allow for a much simpler, transparent international payout process.
“AMRA is transparent in every aspect of its business and operations,” promises their website. “Clients have full access to all their data, in real-time and full transparency on all rates and fees.
“We believe that all data ultimately belongs to our clients and hold nothing back. That is real transparency.”
SACEM C.E.O., Jean-Noël Tronc, begs to differ: “The truth is that the strength of collective management has never been so robust and so necessary for creators than it is today.”
Yet the U.S. Copyright office is staunchly in favor of a radical changes to the current music royalty system, per their recent state-of-the-industry report: “The time is ripe to question the existing paradigm for the licensing of musical works and sound recordings and consider meaningful change.”
Kobalt’s high-tech approach and morphing of the AMRA into the first global PRO is certainly a noble step in the right direction, bridging the gap between online consumer’s habits and real-life artists’ needs. But is a global PRO really feasible?
If AMRA discovers rich new lands of music royalties thanks to its study of online music’s microcurrents, Kobalt will have charted waters where the rest of the music industry will find themselves… eventually.