How to handle royalty reporting and payments for the music used on your app or service
Once you have identified the music rights you need, signed the relevant agreements, and gained an understanding of which songs are covered by your licences, the next crucial step is to determine how you plan to report the required information back to those who own the music. This article will highlight how to go about fulfilling your reporting obligations to ensure fair and accurate compensation for the rights owners.
What is Royalty Reporting?
Royalty reporting is the process of tracking and reporting the usage and consumption of licensed music on your app or service. This involves collecting data on how many times a song has been played, downloaded, or streamed by your users. Think of it as a receipt for your use.
Tracking Usage and Consumption Data
To accurately generate royalty reports, you need to track and record the usage and consumption data for the licensed music. This is done by implementing a system that monitors how many times each song is used on your platform. The data acquired helps ensure precise reporting and avoids overpaying or underpaying for the music.
Adhering to Royalty Reporting Requirements
Understanding and adhering to the royalty reporting requirements outlined in your licensing agreement is essential. These requirements may include:
- Reporting Frequencies: how often you need to submit reports, such as monthly or quarterly, as specified in your agreement.
- Formatting Standards: the prescribed format for submitting your reports. For example, some agreements may request CSV files, while others may have different formatting requirements.
- Required Data Fields: making sure you include all the necessary data fields as outlined in your agreement. This could include information such as song duration.
By complying with these requirements, you ensure that your reporting is precise and in line with the expectations of the rights owners.
It cannot be overstressed that ensuring proper royalty reporting is not just a best practice but a requirement of the music licences you obtain for your app or service. Neglecting to report accurately could result in damaging legal consequences.
Outsourcing
To make royalty reporting easier, apps and services can partner with music rights management companies like Blokur. Companies like Blokur specialise in handling licensing administration and royalty reporting by using technology to handle the complicated data matching, calculations, and tracking associated with generating accurate reports. By outsourcing these tasks, you can save time, cut costs, and focus on improving your digital platform.
Ultimately, understanding and fulfilling royalty reporting obligations is essential for maintaining transparency and fairness in the music licensing process. This allows you to allocate fair compensation to rights owners while focusing on enhancing your app or service to provide the best experience for your users.
If you’d like to learn more about royalty reporting, get in touch with us today!
