Negotiations between artists and record labels have resulted in the formation of an independent organization for digital royalty collection. The announcement came today of the incorporation of SoundExchange, Inc., a non-profit performance rights organization, equally controlled by a board of record company and recording artist representatives. The 18-member board will have nine seats controlled by artists and artist representatives and nine seats controlled by record labels. SoundExchange Inc. is actually a spin-off of the original SoundExchange, which was originally created three and a half years ago as an unincorporated division of the RIAA. It was initially formed due to the passage of the Digital Performance Rights Act of 1995 and the Digital Millennium Copyright Act of 1998 and has since distributed nearly 10 million dollars in royalties, according to a statement from SoundExchange.
To be clear, SoundExchange licenses, collects and distributes public performance revenue for sound recording copyright holders within such digital channels as cable, satellite and the Internet.