Download or stream a podcast today and it would not be uncommon to hear music, if only interstitially and in short segments. For the most part, however, those streams and downloads are not counted for the purposes of calculating and paying any royalties the music rights owner(s) might otherwise be due. Instead, most music used in podcasts today, where its licensed at all, is licensed on a royalty-free basis, often from stock houses or production-music catalogs, through a single, upfront payment that allows unlimited use of the music in podcast episodes for a specified period of time. As no backend royalties need to be paid, no effort is made to report back to the music rights owner how many times an episode is downloaded or streamed.
That system has left many commercial music labels and publishers on the sidelines of the rapidly growing podcast sector. Most would prefer a usage-based, royalty-bearing licensing model that could be integrated with their existing accounting, payments, contracting and marketing operations.
A big reason for the dominance of the current royalty-free licensing system is the absence of podcast data standards that would allow usage data to flow efficiently through both the music and podcast value chains.
The is currently no widely agreed on model for how podcasts should be described and how that information should be distributed throughout the podcast value chain, let alone exchanged with those of other creative industries. As a result, different parties may report different data at different times and in different formats, making integration with other systems effectively impossible.
Recently, however, DDEX, the standards setting body for data exchange within the music industry, set out to change that. In a new white paper, scheduled for publication this week, DDEX aims to “start a conversation between the podcast industry and the music industry,” around definitions and data flows, Niels Rump, a member of the DDEX secretariat, said in an interview. “How should podcasts be described in metadata? What information needs to be exchanged between which parties? How should the information be communicated?”
According to Rump, the lack of standards represents a missed opportunity for record labels. “The labels could do a lot more with podcasting, and I think they would do, if they had usage-based licensing,” he said.
Some of what DDEX envisions for podcasts could involve adopting existing DDEX standards for exchanging music rights information, but the white paper stops short of advocating it. “We want to spark a dialog,” Rump says. “The music industry needs to know what’s important to podcasters and vice versa.”
Data flows for music licensing in podcasts
Rump will discuss the white paper in a special featured presentation at next week’s 2022 RightsTech Summit. He will then join a general discussion on tools and strategies for capturing authoritative metadata at the beginning of the value chain.
Don’t miss this important discussion. Register today for the RightsTech Summit.