Phono V Could Reshape Catalog Valuations for Years. Here’s Why Songwriters Should Pay Attention (Guest Column)
Categoria: Musica
The outcome of the upcoming royalty rate proceedings will have long-term consequences for songwriters.
Por Billboard | 25/09/2026
Ask almost anyone in the music industry about streaming royalties and you will hear the same question: Are artists and songwriters being paid fairly? What receives far less attention are the mechanics that determine how royalties are calculated — and right now, those rules are being rewritten. Earlier this year, streaming services, labels, songwriters, and publishers began the Phonorecords V (Phono V) proceedings before the Copyright Royalty Board. This rate-setting process is split into two, with one determining mechanical rates for physical records like vinyl, CDs and permanent downloads and one determining how streaming platforms calculate and pay statutory mechanical royalties to songwriters and publishers in the United States from 2028 through 2032. Related How Much Have Spotify Bundles Decreased the Mechanical Per-Stream Rate? (Analysis) Billboard to Add Smart Media Albums As Chart-Eligible Sales Formats Duane 'Keffe D' Davis Gives First Interview After Tupac Shakur Murder Conviction While labels and publishers reached a proposed settlement on the physical and permanent download rate on June 29, which is now subject to further review by the Copyright Royalty Board, the much larger and more consequential issue of streaming royalties remains unresolved. Streaming services, songwriters, and publishers will file formal submissions in a few weeks on October 5, with the Board’s determination due by the end of 2027. The outcome of those proceedings will have long-term consequences for songwriters. When the formula to calculate royalties changes, it not only affects immediate revenue but also impacts expected future revenues. Those expected future revenues and projected cash flows are the primary driver of music catalog valuations. The choice of whether to sell your catalog to unlock its monetary value, or to leverage its annual earnings with short-term financing is a complex decision artists and songwriters will face. As we enter the regulatory transition period of Phono V, songwriters must understand the shifting landscape they are making those decisions within and educate themselves on the financial options available to them. Phono V: What’s on the Table — And Why It Matters Building on Phono IV (2022), which delivered meaningful gains for songwriters and publishers, Phono V will reassess how subscription revenue is allocated and mechanical royalty rates are structured — decisions that directly influence long-term royalty income. One key issue on the table for Phono V is bundling. Bundling first gained attention in March 2024, when Spotify added audiobooks to its plans and reclassified its duo, family, and premium subscriptions as “bundles” allowing for lower mechanical royalty payments under Phono IV. As other streaming services followed suit, the financial impact became clear: the NMPA estimates bundling has cost publishers and songwriters nearly $500 million since 2024, and is set to cost them over $3.1 billion between 20