• Since opening for business, Merlin has paid in excess of $2bn to thousands of independent labels and distributors worldwide. While it took 9 years to distribute our first billion dollars, it has taken only 18 months to distribute our second

• $845m was paid to independent label and distributor members between April 2018 and March 2019 - including more than $130m in revenues from settlements and other non-royalty income such as proceeds from the sale of Spotify shares

• Annual member survey reveals that 80%+ of Merlin’s global membership saw their overall business grow in 2018

• 2019 Membership Report features interviews with labels and distributors - including Secretly Distribution, Eleven Seven Label Group, mtheory, Sub Pop, Armada Music, Zebralution and Altafonte - detailing how Merlin is empowering their independent business

Merlin, the global digital rights agency for the independent label sector, has today published its 2019 Membership Report & Survey - revealing a 63% year-on-year increase in member payments (April 2018 - March 2019) to $845m.

This total includes over $130m in revenues generated from settlements and other non-royalty income such as proceeds from the sale of Spotify shares, distributed in line with Merlin’s commitment to transparent and accurate reporting.

Since announcing its first commercial partnership in 2008, Merlin has now paid in excess of $2bn to its members, who collectively represent thousands of independent labels and distributors, and licensed more than 25 DSPs on a global basis. The $2bn landmark was passed in February 2019, and comes only 18 months after Merlin announced its first $1bn in payments.

Over the past 12 months, Merlin has welcomed its biggest influx of new members since launch - adding another 141 companies to its membership - and now represents independent music businesses across 63 countries.

Charles Caldas, CEO, Merlin, said:
“I am delighted to report another record-breaking increase in payments to our global membership. What’s particularly gratifying is the inclusion of more than $130m in monies that members would not have captured were it not for Merlin’s formation. These are significant revenues that underline the incremental value Merlin brings to our global membership.

“That we can deliver such payments is testament both to the collective strength of our members’ repertoire, and Merlin’s ability to deliver best-in-class licensing alongside fully equitable and transparent reporting and payments. It means Merlin’s members can report quickly and accurately to their artists and clients, that they can thrive as truly independent businesses, and invest even further in the creation and development of new music.”

Helen Alexander, CFO, Merlin, added:
“It’s an absolute priority for Merlin that our reporting is transparent and fully attributable, and especially so given the increases in non-royalty income. This is no small undertaking, but it ensures our members can understand what they’re being paid - and why. For instance, every cent that Merlin received from the sale of Spotify shares was paid out quickly, pro-rated on a track-by-track basis, and with 100% transparency.”

The report also presents results from Merlin’s 2019 member survey, which this year elicited its largest ever number of respondents, with data collected from independent labels and distributors in 35 countries across five continents.

Key findings include:

• More Merlin members are growing their overall business.

An unprecedented 81% of respondents stated their overall business revenues had increased in 2018 - with 30% stating that overall business was up by more than 50%. This marks a significant increase on previous member surveys, where an average of 67% of respondents said their total business revenues had increased the previous year.

Unsurprisingly, Merlin’s “optimism index” also hit an all-time high in 2019. 85% of respondents say they are optimistic about the future of their business - compared to 78% in 2018.

• Audio streaming continues to drive digital income. Digital income dominates overall business revenues.

More than half (54%) of Merlin members report that digital income currently accounts for more than 75% of their overall business revenues. In our 2018 survey, only 39% reported this was the case.

This growth continues to be primarily driven by audio streaming. Half of respondents (49%) state that audio streaming is responsible for over 75% of their digital income - up from 37% in 2018.

• Percentage of digital income from video streaming remains static (with potential green shoots)

By comparison, the dynamics around video streaming appear static - with 79% of respondents saying that video accounts for less than 25% of their digital income. A percentage that is practically unchanged from member surveys stretching back to 2014.

However, there are positive signs.

Income increases from video streaming are at least keeping pace with audio streaming - the money received is still going up. Meanwhile, respondents who said video accounts for less than 10% of their digital income dropped from 63% (2018) to 55% in 2019. Those who said video accounts for less than 5% of their digital income dropped from 37% (2018) to 31% (2019). 

• Merlin members look to China for global expansion

Outside their home territory, 32% of non-US members believe the USA offers the greatest potential for increased digital consumption of their repertoire.

15% of respondents believe that China offers the greatest potential, despite fewer than 0.5% of Merlin members having their primary business based in mainland China.

In 2018, Merlin agreed landmark non-exclusive partnerships with Chinese DSPs NetEase, Alibaba and Tencent. Meanwhile, the affinity for Merlin members’ repertoire across Latin America continues, with Brazil currently Merlin’s fifth most valuable territory and Mexico inside the Top 10.  

The report was presented today by Merlin CEO, Charles Caldas, to delegates at A2IM’s Indie Week, followed by a panel discussion (The Benefits of the Independent Path to Market) featuring Portia Sabin (President, Kill Rock Stars), Chris Welz (MD, Secretly Distribution), Jim Mahoney (GM MERLIN US), Jorge Brea (CEO, Symphonic Distribution) and Katie Alberts (SVP Operations, Reach Records).

Also included in the report are in-depth interviews with Merlin members, including Secretly Distribution, Absolute Label Services, Armada Music, Altafonte Network, Eleven Seven Label Group, Heroic, HIP LAND MUSIC CORPORATION, mtheory, Sub Pop and Zebralution.

The report can be downloaded here.