The music industry spent a long time trying to convince consumers that digital sales and piracy were going to be the death of the industry. Music labels and artists complained that people were buying digital singles rather than complete albums. However, according to SoundExchange, it has paid out some serious money in royalties to artists and record companies since the nonprofit group was founded in 2000.
SoundExchange is a group that processes payments for online streams and pays out royalties to the artists and record labels. The company says in the 12 years since its founding it has paid out $1 billion to artists and record companies. SoundExchange also notes that quarterly payments this year have exceeded $100 million.
SoundExchange collects money from Sirius XM radio, Pandora, and other Internet radio stations. It’s interesting that for the artists and record labels, this is the only place they get earnings for radio play. The New York Times reports that terrestrial radio stations only pay songwriters and music publishers. Things have significantly changed for SoundExchange since March of 2004 when it only collected $15.6 million in royalties. In 2011, the company paid out $292 million in royalties.