Laura Williams manages SoundExchange’s communications strategies, including overseeing the launch of a new, better-than-ever www.SoundExchange.com in coming weeks. She holds degrees in Political Communications and Writing from Susquehanna University.

You may have heard about SoundExchange lately. We’ve paid out more than $111 million in royalties so far this year, are out in front fighting for fair compensation for artists, and making sure the 43,000+ recording artists and 5,000+ copyright holders we represent are getting paid when they get played.

With all those artists and all that money, it’s surprising how many people don’t know about SoundExchange yet. If you've got questions about what SoundExchange is or does, check out our ‘What Is SoundExchange’ video:

Here's the upshot: when sound recordings are played on certain digital services, satellite radio like SIRIUS-XM, Internet radio like Pandora, those high-numbered cable channels like MusicChoice, or streamed as background music in some restaurants or stores, the artist who performed on that recording earns a royalty. So does the copyright owner, which may be a label, or an independent artist who owns his own masters.

The digital services who owe those royalties either have to make a deal with each and every artist and rights owner directly (a direct licenses) and cut them a check, or they can use the blanket permission set up by the government (a statutory license). If they’re eligible for the statutory license, that service can use any commercially-released track ever made, without asking for permission from the artist. The service writes a check to SoundExchange, and provides a report of use - basically, a playlist of every track they've used, and who the artist and copyright holder are for that track.

SoundExchange is the only service the government allows to collect those royalties. Our job is to sort through the reports, find out what percentage of the money each artist or rights holder is owed, and then send them a check for what all the services together owed them. That's harder than it sounds. We don't always get good data from the services that use your tracks - how are we going to distribute to "various artists" or "label unknown"?

More importantly, SoundExchange collects royalties for EVERYONE whose tracks are played, even if they haven't registered with us, even if they've never heard of us! SoundExchange has only been around since 2001, so we're still getting the word out to artists and rights holders that this royalty stream exists. Unlike our friends at ASCAP, BMI and SESAC (more on them later) we don't just collect for our members. But we need artists to register with us, or we have no way of knowing where to send the money. We have many ways of contacting artists, from social networking to database matches to one-on-one meet-ups at conferences and festivals, but it’s a big job. Our 43,000+ artists and 5,000+ rights holders spread the word to their friends and colleagues, and success stories are our best method of outreach. So get registered, get paid, and tell a friend.

If you're not registered, get registered. Don't worry, though- SoundExchange hasn't given away your royalties. Artists and rights owners who sign up today can collect royalties they earned all the way back to the beginning of collections in 1998. We get a few hundred new registrations every month, and our online registration site has them coming in faster than ever. Remember, it’s always 100 percent FREE. We’re just giving you money that’s already yours. 

Another big difference between SoundExchange and other performance rights societies is that we advocate and expect per-play reporting from services. That means that instead of relying on sampling reports – four weeks a year or a few days a month – to determine what to pay, we ask services to report every track they play, every time they play it. In fact, 95 percent of the money we distribute is accompanied by ‘census data’ – that is, every track played, every time it’s played. We strongly believe this is the fairest way to distribute, and to make sure royalties get to the people who’ve earned them. We still accept sampling data from a few webcasters as a special accommodation, but we believe that census data is the way of the future, and SoundExchange is on the cutting edge of that movement. 

SoundExchange is a nonprofit. None of our staff of forty-five music lovers is in this for the money. We come to work every day excited about helping the people who create music get paid for their work. A lot of us are musicians ourselves, and some are recording artists. Our Board of Directors, who set our organization’s course and priorities, is evenly split between the representatives of recording artists and of rights holders. We're run by the people we pay, and staffed by people who believe in what we do.

When we’re out on the road spreading the word about SoundExchange and digital performance rights, we hear and answer the same questions over and over. So in case you’re wondering, too, here are a few of our top FAQs.

Q: You have money for me? And it’s free? What’s the catch?

A: There isn’t one. Zero, zip, nada. We were set up by the Library of Congress and the Copyright Royalty Board to collect money you’ve already earned. It’s your money, waiting here for you. You just have to tell us where to send it. That’s all there is to it. No registration fee. No Nigerian email addresses. Promise.

Q: I’m already a member of ASCAP, BMI or SESAC. Can I be a member of SoundExchange, too?

A: YES! We collect for a different royalty, for a different copyright than our friends at these organizations. They pay songwriters and publishers, the creators of music and lyrics written down on paper, and we pay recording artists and copyright holders, the creators of the master sound recordings. We encourage you to be a member of one of these organizations, AND of SoundExchange. They’re in no way in conflict.

Q: How does SoundExchange make money?

A: As an organization, we don’t. We’re a non-profit. We do retain a small percentage of the royalties we collect to pay our staff and keep the lights on. Although all performance rights organizations are funded this way, we have the lowest rate in the industry.

Q: Who does SoundExchange pay?

Of the royalties earned on a track, we pay 50% to the copyright holder and 45% directly to the featured recording artist. 5% goes into a fund which compensates backup musicians and session players. Independent artists who own their own masters keep 95%! 

Q: If I register, will I get paid right away?

A: Although we’re improving efficiency every day, SoundExchange can take up to 180 days to fully process a registration, including tax information, and compare it to our database of 7 BILLION performances. If those searches show you’ve accrued more than $10 in royalties, you’re eligible to be paid right away by Direct Deposit. Our average annual payout per registrant is about $3,000.

Q: What don’t you collect royalties for?

A: SoundExchange DOES NOT collect for digital downloads (like iTunes or “podcasting”) or “on-demand” plays like YouTube or MySpace, where a user can select and immediately play the song she wants to hear. SoundExchange also does not collect for the streaming of any audiovisual work, including music videos.

We also don’t collect royalties for AM and FM radio plays. Why? Because artists and copyright holders don’t get paid for radio plays. When you hear “Respect” on the radio, Otis Redding, who wrote the song, gets paid. Aretha Franklin, who sang the song and made it famous, doesn’t see a penny. Surprised? Most people are. Sound unfair? We agree. That’s why when our members authorize us to use a little bit of their money to protect and promote their rights, SoundExchange uses some of that to help out a group called musicFIRST (Fairness in Radio Starting Today). Our allies at musicFIRST are trying to close the loophole in copyright law which lets over-the-air radio stations to use your music without compensating you. Check out their website at www.musicfirstcoalition.org, and get in touch with your representatives in Congress, and let them know you support a full performance right for artists.

So if you hadn’t heard about SoundExchange, or you thought digital performance rights were just too good to be true, now you know. Get registered, get a friend registered, and let us help you get paid when you get played.

Laura Williams