Sony Music has announced its plans to remove unrecouped costs from their heritage lineup dating back to artists from 2000, as reported by Music Business Worldwide. What this will mean is that the record company Sony Music, will no longer have unrecouped debt added to a legacy artist, and the artist will now start to see some amount of royalties tickle from their music. This is particularly helpful to many black heritage artists.
Unrecouped debt is usually made when the record company pays for the bills of such things as studio bookings, PR, external musical hire, some costs of touring, etc. The band/artist doesn’t pay this directly, rather they perform (to promote) their music and have their music bought/played until the band/artist makes enough money to pay off their debt and eventually start to earn their own money through royalties. Some bands/artists never see any royalties come in due to unrecouped debt.
Sony Music is following the steps of Warner Music Group, who have gained a substantial amount of money from Spotify, some $504 million. 25% of the money was then allocated to artists’ individual unrecouped balances. Sony Music made $768 million, and the $250 million will go towards their new program of paying off unrecouped debt.
Sony Music’s boss Rob Stringer is determined to “do the right thing” and has set up programs to help allocate and pay off unrecouped debt and pay artists their fair share of royalties. The Legacy Unrecouped Balance Program notifies which artist is eligible for this plan. Those eligible will also be notified of Sony’s Real Time Advances application, Sony Music Artist Portal (much like PRS/PPL within the UK) – a feature that’s available in the US and the UK with plans to roll it out in additional markets later this year.
This is great news to hear, especially during the pandemic. This is welcome news for many artists/bands and perhaps many more large record companies can follow suit.