Last summer, Sony Music Group shocked the global music industry by doing something historic: announcing that it was not accounting for uncollected balances for thousands of artists and songwriters around the world. heritage who had signed with the company in previous decades.
Today (February 1), in another defining moment for the music industry, one of Sony’s biggest rivals decided to do the same: Warner Music Group.
WMG, the third largest music rights company in the world, has just confirmed the establishment of a “former unrecovered advance program”, which will come into effect on July 1.
In Warner’s own words: “[We’ve] announced an unrecovered legacy advances program where, for our artists and songwriters who signed with us before 2000 and did not receive an advance during or after 2000, we will not apply their unrecovered advances to returns royalties for any period beginning on or after July 1, 2022.
“The program will also benefit other royalty participating artists such as producers, engineers, mixers and remixers.”
Or if you allow MBW to put it another way: Are you an eligible artist or songwriter whose streaming royalty money is kept by Warner every month because you are still not recovered on historical advances? Well, starting this summer, that money will start landing in your bank account.
Today’s news follows other artist and writer updates Warner has made to its release terms over the past 15 years.
Notably, since 2009, WMG has shared all streaming service advances and minimum guarantees with artists – “treating breakage like other digital revenue”.
And in 2016, Warner became the first major music company to confirm that it would share proceeds from the sale of its Spotify stake with its artists.
(Warner then did just that, having sold its entire stake in Spotify for $504 million in 2018. However, unlike Sony, it didn’t ignore unrecovered balances when paying that money to its listing.)
As well as causing celebration among the artist community, today’s news is sure to spark a big question: Will Universal Music Group be the next major music company to announce it’s not holding account of unrecovered balances for artists in the catalog?
Universal has already pledged to share the proceeds of its Spotify shares with its artists whenever it sells its shares in the streaming company.
UMG, prompted by Taylor Swift, has Also pledged to ignore unrecovered balances when passing that money on to artists.
However, Universal has yet to sell its Spotify shares.
UMG is thought to own around 3-4% of Spotify – a stake which, despite Spotify’s recent drop in market valuation, is estimated to be worth more than $1 billion.
Warner confirmed its new unrecovered advances program in its inaugural Social Governance and Environmental (ESG) report, which it released today.
Warner calls this document “a vehicle for communication with key stakeholders and a benchmark for WMG to measure its ESG progress in areas such as employee well-being, diversity, equity and inclusion, social impact and climate change”.
Led by Samantha Sims (Vice President, ESG) and WMG’s ESG Oversight Executive Committee, the report was created with input from more than 70 employees.
His other highlights include details on the actions Warner has taken on environmental, social (including mental health programs for employees) and governance issues.
You can read the full Warner Environmental Social Governance (ESG) Report this way.The music industry around the world