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US musicians union sues over digital royalties and pension payments

By | Published on Tuesday 11 August 2015

American Federation Of Musicians

The American Federation Of Musicians has sued the major record companies in the New York courts over digital income, and while the case is very much centred on the union’s pension fund, it contains some familiar gripes about unnecessary complications and lacking transparency when it comes to the revenues generated by digital music services.

The lawsuit relates to an agreement between the majors and the AFM pension fund, in which the American branches of the record companies promised to pay 0.5% of all receipts from non-domestic (mainly) digital transmissions of recordings into the fund. This agreement includes monies from streaming, non-permanent downloads and ringbacks, and dates back to the 1990s – when such income was very more periphery for the labels – though has been renewed more recently.

The union says that independent auditors identified missing payments last year, but attempts to settle the matter directly have been unsuccessful. AFM International President Ray Hair says: “The record companies should stop playing games about their streaming revenue and pay musicians and their pension fund every dime that is owed. Fairness and transparency are severely lacking in this business. We are changing that”.

Yeah, good luck with that. Still, if it were to get to court, this legal battle could create another interesting spotlight on what exactly is happening to streaming income.



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