December 20, 2018Vol 6 | Issue 6

www.soundexchange.com1

In This IssueA D V O C A C Y N O T E S

The AMP Act and LODs: Helping Producers, Mixers and Engineers Receive Payments 2

M E M B E R N O T E S

Changes to Statement Delivery Coming in 2019 4

P U B L I S H I N G N O T E S

MDX Update: Publishers Embracing New SoundExchange Technology 6

Happy Holidays!

2 www.soundexchange.com | December 20, 2018

The AMP Act and LODs: Helping Producers, Mixers and Engineers Receive Payments

Passage of the Music Modernization Act (MMA) codified

SoundExchange’s practice of honoring Letters of Direction

(LODs) from recording artists. Through LODs, producers

and other creative participants receive payments from

recording artists for their work in the sound recording

process.

Now that the MMA has become law, SoundExchange is

reaching out to producers, mixers and engineers to answer

their questions on how the process works and changes

instituted by MMA.

“We want to make it simpler and easier for all creative participants to receive direct payments,”

SoundExchange President and CEO Michael Huppe said.

Two Easy Steps for Producers, Mixers and EngineersSoundExchange initiated efforts to get producers, mixers and engineers paid with creation of the LOD

program in 2006. Producers, mixers and engineers who want to collect royalties from recording artists

and receive direct payments must take two important steps as part of the LOD process:

uSTEP ONE: Go to the SoundExchange website and request a Letter of Direction. All the

information you need to complete that step is here;

uSTEP TWO: After you fill out the LOD, send it to the recording artist you worked with for a signature.

SoundExchange cannot process an LOD that has not been signed by the recording artist or their

authorized representative on file with SoundExchange. Also, please remember that payments

via LOD are not “off the top.” You will have to send an LOD to each artist you worked with on a

recording (for example, if you worked with a band, you will need each member of the band to sign

an LOD directing a portion of their royalties to you). And, for collaborations with multiple featured

artists, you will need to obtain an LOD from each featured artist.

Either the artist, the creative participant or their respective representatives can submit the completed

forms using their SoundExchange Direct account under the “Letter-of-Direction” tab or by sending an

email to accounts@soundexchange.com

A D V O C A C Y N O T E S

We want to make it simpler and easier for all creative

participants to receive direct payments.

3 www.soundexchange.com | December 20, 2018

Things to RememberIt’s up to the artist to sign the LOD, which gives us the authority to redirect payments to you. Recording

artists are not obligated by SoundExchange to sign an LOD or pay producers, mixers and engineers. It’s

also important to remember that the artist you worked with must be registered with SoundExchange

before we can redirect a portion of their royalties to you. SoundExchange urges all producers, mixers

and engineers to contact the recording artist they worked with to confirm that he or she is registered

with SoundExchange.

“The success of this program is important to producers, mixers and engineers, but it’s also important to

SoundExchange,” Huppe said.

Beginning in 2020, the tax provisions of the AMP Act will take effect, which means that SoundExchange

will handle the tax components of LOD payments, including withholding and 1099 filings.

Pre-November 1, 1995, Recordings Treated DifferentlyThe AMP Act created a separate process for producers, mixers and engineers who worked on sound

recordings made prior to November 1, 1995. Under the law:

uProducers must reach out to an artist to try to contact the artist over a period of 120 days;

uIf an artist is not responsive, then the producer, mixer or engineer can ask SoundExchange to try to

contact the artist over another period of 120 days, provided, however that the producer, mixer or

engineer has given SoundExchange certification, under penalty of perjury, stating that the producer,

mixer or engineer is entitled to payment from the artist pursuant to a written contract, and provided

SoundExchange with a copy of such contract;

uIf there is no objection from the artist, SoundExchange can direct 2% of the royalties for that track

to the producer, mixer or engineer, provided the artist is receiving payments.

Your ResourcesYou can register with SoundExchange and request an LOD here. Learn more about the AMP Act here.

If you have any questions about the process, just call us at (1-800) 961-2091.

A D V O C A C Y N O T E S

4 www.soundexchange.com | December 20, 2018

Changes to Statement Delivery Coming in 2019

SoundExchange is making an important change in the New Year to how you receive your statements.

Recording artists, rights owners and their authorized representatives should be aware of the changes.

SoundExchange Direct (SX Direct) is already the fastest, most secure way for the SoundExchange

community to review their statements and manage their accounts. However, for your convenience,

SoundExchange also sends you an email with links to your statements whenever new payments are

made.

What Will Change? Beginning in January, the statement links in your royalty payment email will take you directly to SX

Direct, where the statements are located. The regular email notifying you of payment will still go to

everyone who currently receives them (the primary email on file for the account receiving payment).

However, to access a statement, the email recipient will now be required to log in to SX Direct.

SX Direct users will not be able to view a statement until they log in. If you already have a log in, you

don’t need to do anything to prepare for this extra step. Just click on a statement link in your email, log

in, and the statement will become available.

If you do not yet have a log in, you can set one up using this “join” link:https://sxdirect.soundexchange.com/join

Just follow these steps:

uOn the “join” page please enter the email at which you already receive statements for your

SoundExchange account and follow the instructions;

uIf you do not already have a login, you will also have an opportunity to create one in January when

the statement email arrives;

uIf you receive a statement email in January, click on a statement link and you will be prompted to

log in, or to set up your login.

M E M B E R N O T E S

If you’ve already set up your log-in in SX

Direct, you don’t need to take any other steps.

Just click on the statement link in your email,

then log in and the statement will be available.

If you haven’t set up your log-in, go to our

“Join SoundExchange Direct” page:

https://sxdirect.soundexchange.com/join

5 www.soundexchange.com | December 20, 2018

Why is SoundExchange Making These Changes?Protecting the account information of our SoundExchange community remains a top priority. This

change to your statement email, requiring SX Direct login, will provide increased security for your

sensitive payment and account information.

SX Direct Remains an Indispensable ToolSX Direct allows users to easily dive deeply into their payment data and verify or update their account

information. Some key features of SX Direct include:

uAn interactive view of recent revenue data by song and by service;

uFull payment history and statements archive, back to 2012;

uTransparency into all songs associated with your account in the “My Catalog” section;

u24/7 online access to review and update account information;

uAbility to submit repertoire data and Letters of Direction.

SoundExchange encourages all users to check their account details to make sure it includes the most

up-to-date information. That will ensure that users receive payments quickly and accurately. Here’s how

users can check payment details once they have logged in to SX Direct:

uClick the registrant name;

uClick “Payment Settings”;

a. Under Payment Settings you can view and edit the address we have on file (for check payments

and mailed yearly tax documents);

b. You can also see what tax information we have on file for you, and your account’s current rate

of IRS withholding. If you want to update your tax information, you can click “Request Update”

under “Tax Information”;

c. You can also see what bank account information we have on file. If you want to add direct

deposit to your account or change your bank account information, click “Request Update”

under “Bank Information.”

Do You Have Questions?Please send an email to accounts@SoundExchange.com or call our Customer Service team at 1-800-

961-2091 if you have any questions about these changes.

M E M B E R N O T E S

6 www.soundexchange.com | December 20, 2018

MDX Update: Publishers Embracing New SoundExchange Technology

In just eight months, Music Data Exchange (MDX) has

benefited the music industry by improving the way rights

owners share crucial metadata and rights information.

Hundreds of labels and publishers have registered to

use MDX to exchange pre-release sound recording and

work information in real time. Record labels submit their

requests for publishing data to MDX, where publishers

can view and claim their shares on one central site. MDX

provides much needed efficiency, transparency and

owner-driven accuracy to this process.

“MDX is becoming the standard for information

sharing between recording companies and publishers,”

SoundExchange President and CEO Michael Huppe

said. “As a result, music creators and rights owners are

benefiting from this dramatically improved work flow.”

SoundExchange unveiled MDX in May 2018 to facilitate the exchange of publishing data between record

labels and music publishers. Today, all major U.S. record labels and publishers are registered and are

actively using the site.

What is MDX?MDX is a free software application developed in cooperation with the Recording Industry Association of

America (RIAA) and National Music Publishers Association (NMPA) to provide a central database of pre-

release metadata and publisher rights and claiming capabilities.

The site employs the latest in automated messaging to enable high-volume, real-time data exchange.

SoundExchange communicates with its top label and publisher users weekly to ensure that MDX

operates as best it can and addresses the needs of all users.

Why Use MDX?MDX offers its users full visibility to claimed and unclaimed shares for musical works and allows

publishers to communicate their shares. That results in owner-established links between sound

recordings and their underlying compositions. The net result is that information sharing between

publishers and labels is vastly improved, and hence the speed and accuracy of mechanical royalty

payments is improved.

P U B L I S H I N G N O T E S

SoundExchange unveiled MDX in May 2018 to facilitate the exchange of publishing data between record labels and music publishers. Today, all major U.S. record labels and

publishers are registered and are actively using the site.

7 www.soundexchange.com | December 20, 2018

MDX Continues to Gain TractionDemand for MDX has grown rapidly. At the end of November, MDX had:

u nearly 200 registered labels

u 320 registered publishers

u 14,098 works requested

u 6,890 publisher responses

u 558 active users

The volume of requests continues to grow as more labels and publishers utilize the site.

SoundExchange receives nearly 500 requests for publishing data flowing through MDX each week.

Looking AheadMDX will roll out a fully searchable works database early in the New Year. Users will have visibility into

back catalog shares in addition to the new releases currently available.

Your ResourcesWe’ve developed an extensive FAQ that will answer many of your questions about the new service.

Have questions or want to see a demo? We offer MDX demos weekly to MDX users and potential users.

Send an email to info@musicdataexchange.com and we will include you on a demo session. Do you

need to set up an account? You can request one at https://musicdataexchange.com/account.

We created a short video that illustrates the need for MDX and how it works.

P U B L I S H I N G N O T E S