Equity vs. Cash For Rights Societies?

The major labels and publishers often get flack for stalling innovation with demands for large advances and other demands, and deservedly so. But performing rights societies, with their own complex set of rules and priorities are often a roadblock as well.

A new UK white paper proposes that performing rights societies consider negotiating for equity with music startups rather than a more specific payment structure. "Should Societies Pursue Equity?" acknowledges…

that startups are usually short on cash and have often chosen to operate without any licenses rather than make promises they can’t keep. Their business model is also often in flux  which means a deal made today may be obsolete tomorrow.  Most importantly, the proposal acknowledges that both the startups and performing rights society members benefit from innovation that increases the market for music.

There are dozens of reasons – from startup failure rates to legal and contractual – why this concept may never work.  But it is indicative of the kind of creative thought that is needed to reverse the music industry’s downward slide.

Read the 3 page PDF and let us know if you think this idea has merit.