Recently, artist Gary Numan gave an interview to Sky News during which he talked about streaming royalties, and specifically about a small cheque he’d received.
“I had a statement a while back and one of my songs had had over a million plays, million streams, and it was £37. I got £37 from a million streams,” said Numan. The story has since been widely shared.
The label Numan is most associated with is Beggars Banquet, but this week Beggars Group founder Martin Mills got in touch with Music Ally with a joint statement from the label group and Gary Numan, clarifying that it was not the label involved.
You can read the full statement below: including some interesting data on what Numan is actually earning from streams of the music he recorded for Beggars Banquet.
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STATEMENT FROM GARY NUMAN AND BEGGARS.
Following the press coverage of the report that Gary Numan only received £37 for a million streams, we would jointly like to clarify that that was not on a royalty statement from Beggars Banquet, his original label. On average Gary receives over £2,000 per million streams on recent royalty statements from Beggars.
Gary Numan said – “The quote in question was taken from an interview where I was asked to discuss the low rates paid by streaming companies. It was a discussion specifically about streaming companies, not about record labels or their role in the subsequent distribution of income from those low streaming rates. The figure that I mentioned in that interview was not from a Beggars Banquet statement and it certainly doesn’t reflect my recent earnings from them. Although I believe that many record labels could do far better when it comes to the share of streaming income they pass on to their artists, Beggars Banquet would seem to be doing better than most and I continue to enjoy a very positive relationship with them. The artist v record label discussion, in relation to streaming, is not connected to my £37 comment but is a discussion that I will gladly take part in at another time.”
Beggars’ Martin Mills commented – “If it hadn’t been for Gary, Beggars would likely not have survived, let alone achieved what it has. We value and appreciate the artists we have worked with over the last forty years, all of whom have contributed to our growth and success. Although our contracts have always covered all rights, known or unknown at the time, clearly the older ones could not have considered the economics of the digital market. Hence we’ve always seen it as appropriate to review and update their terms over the course of time.
It’s a common fallacy that digital distribution is cost free. It’s not – costs of delivery, storage, security, data management, digital accounting etc, have simply replaced old manufacturing and distribution expenses. But, although new release marketing and promotion costs are higher than ever, the economics of catalogue have improved and thus, over the years, we have been able to pay our catalogue artists a higher rate than their contracts provide for.
It’s true that without income from catalogue, labels wouldn’t be able to invest in new releases. But, that doesn’t mean they can’t pay decent, modern digital royalties, as we do. I’ve considerable sympathy for those legacy artists trapped in old world contractual arrangements. I understand their frustration that streaming is not serving them well. But with fair modern royalty rates and increasing revenues, year after year, it will do.”
Beggars signed Gary in 1978 on what now seems a very lowly royalty, which was normal at the time. With the success of ‘Replicas’, and the support of Warners, that was renegotiated upwards in 1979. In 2009 Beggars unilaterally increased the royalty for all catalogue artists to a minimum of 18%.
With the advent of streaming Beggars adopted a policy of paying a higher rate for that format and in 2016 that settled at 25%. In 2017 Gary’s contract rates were improved again and the accounting basis was adjusted to a net receipts-type structure. Since that revision, and on a like for like basis, Gary’s streaming income has increased by 76%.
The nature of streaming is that there is a huge differential in receipts from mature and new markets, and between premium and ad-supported services. An average rate thus reflects considerable and inevitable variations, as new markets come on-stream and grow, and as the freemium model develops.
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That’s the end of the statement. Back to our analysis now. The £2,000 per million streams figure is useful, not least to compare with figures discussed and released by major labels as part of the UK’s parliamentary streaming inquiry. For example, in a written submission, Sony Music said that a typical artist on a 25% royalty rate would need 800 streams on a subscription tier to earn £1 as their share of the royalties – so around £1,250 per million streams.
Meanwhile, during the session featuring the major labels’ UK bosses, WMG’s Tony Harlow and UMG’s David Joseph talked about artists on a 20% royalty rate (note, not 25% as in the Numan and Sony examples) earning around £1,000 per million streams after the label’s cut.
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