Work Toward a Fairer System for Streaming Payments

February 1, 2025

Ben Kessler  -  Ben Kessler, AFM Director of Government Affairs

I frequently receive questions about music streaming policy and streaming platforms’ inequitable payment systems. The conversation typically begins with musicians asking whether the streaming proposals in Congress have any chance of becoming law, and of course, what actions the AFM is taking in response.

There is a popular misunderstanding among many in the public that, if independent artists joined together (form a union), they can negotiate fairer compensation from streaming platforms. However, the relationship between rights holders and platforms is one of the licensor/licensees. There is no employee contract on which to bargain.

Independent contractors’ inability to collectively bargain is a matter of antitrust law. Representative Deborah Ross (D-NC) has a legislative proposal to address that very issue. The Protect Working Musicians Act (PWMA) would fix the antitrust problem. The bill would create an antitrust exemption for individual rights holders to “collectively negotiate music licensing terms” with both streaming platforms and artificial intelligence (AI) developers. Upon reintroduction in September 2023, Ross stated that PWMA is designed to level the playing field for independent artists and record labels.

If the author of the bill is singling out only a subset of our sector, why would the AFM support the measure? After all, the AFM is a beneficiary of the major labels’ agreements with the platforms. Collective negotiation has the potential to increase the value of all music on streaming platforms. With more voices advocating for larger payouts for musicians, we have the potential to change the current dynamic—one in which only the most popular songs are favored, and others are told that their work with fewer plays has no value at all.

Representative Rashida Tlaib (D-MI) also has a proposal to address the inadequacies of streaming payouts for artists. The Living Wage for Musicians Act would tax ad-supported, nonsubscription streaming revenue and add a fee to the price of streaming platforms. We’ll want to make sure consumers are not pitted against artists. But any proposal that would put more money directly into the hands of musicians is one worth considering.

As written, 90% of funds would be allocated to featured artists, with 10% to nonfeatured. The latter would be distributed via the AFM and SAG-AFTRA Fund. We look forward to working with Tlaib to ensure that all musicians, featured and session alike, benefit from any legislative approach.

At the time of writing, just days into the 119th Congress, neither Ross nor Tlaib have reintroduced their bills. But we know for certain that both Members of Congress remain committed to working toward fair compensation for musicians. We are grateful for their leadership and recognition that musicians deserve a system that affords them a living wage.

Can any of this become law? This is the unfortunate reality of the legislative process in the US Congress. These are likely “marker bills.” They are legislative proposals so Members of Congress can take policy positions and influence further debate. It is a deeply unsatisfying answer to what should be an easy question.

I was recently asked whether music rights holders have any leverage to get streaming platforms to the negotiating table. There, my answer was straightforward “No. Right now? None at all.”

Our advocacy and so-called marker bills can change that dynamic. There is a tremendous amount of work to educate policymakers and shift public opinion. Together with congressional champions and like-minded organizations across our sector, we are working toward a fairer system.

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