mr. Probz is convinced that record company Sony Music Entertainment (SME) has withheld a large amount of money. The singer, known for the hit Waves, is therefore suing the company for 10 million euros. mr. Probz suspects that the record company has also funneled money intended for other artists and songwriters. What’s up with that?
By Michiel Vosmr. Probz broke through in 2013 with Waves. Not only the original version, but also a remix by DJ Robin Schulz became a hit. The success of the singer, who is actually called Dennis Stehr, was not limited to the Netherlands: Waves went all over the world.
The song became a number 1 hit in many European countries, including the United Kingdom. The remix has more than 817 million streams on Spotify and the original another 114 million. The singer also scored a big hit with Nothing Really Matters (89 million streams).
A lot of money has been made with the music. But according to mr. Probz didn’t put everything in the right place. Some of that money would have been left at the mercy of SME and third parties.
The case against his former record company concerns the payment of royalties. A party that uses another person’s work must pay compensation to the author, artist, publisher or record company. This can involve sampling or covering music, but also use in series, films or commercials, streaming or the sale of an album.
To market their music, artists and songwriters work with a record company or publisher. They lay down in a contract what percentage of royalties the artist or songwriter will receive and what he will give.
A percentage of something, but what is ‘something’?
“I always tell my clients: when you are offered a percentage, always ask what the percentage is calculated about. A percentage is always a part of something, but it must be clear what that ‘something’ is,” emphasizes Sander Petit, who assists artists and record companies with his company De Dance-advocaat.
mr. Probz had an at-source provision in his contract, he says on his website. This means that when calculating the royalties, it is necessary to look at what is earned in total with the music and not only at what a record label like SME has received. This provision ensures that a songwriter does not suddenly have to give a higher percentage if the record company works with third parties and local publishers.
“If you want to release your music in Japan, for example, you need a local party that knows the market well,” explains Petit. Such a company charges a fee for its services before passing on the revenue to the record company. “If Sony uses that amount – from which that fee has already been deducted – to calculate the percentage that goes to the artist, then there is no longer any question of at sourceAs a result, the artist receives less money than what is contractually agreed.
Lack of transparency is the biggest problem
The problem, according to Petit, is that the music industry is not transparent about this. For example, it is often not clear to artists how much is earned with their music and what part of that income is passed on to them. “In the streaming era, this is accompanied by enormous amounts of data, especially if you have such a big hit like Mr. Probz. As an artist you need a specialist to be able to turn it into chocolate.”
In 2020, Mr. Probz already confronted SME with his company Left Lane BV in court. At the time, it was determined that the record company had to open up business in the form of accounting. The copyright law has also recently been amended, requiring music creators to provide an annual statement of income and costs. Petit: “The fact that it concerns complex data does not mean that parties such as record companies have no responsibility to make this transparent.”
mr. Probz and his lawyer state – substantiated with research by accounting firm Grant Thornton – that SME and subsidiary Ultra Records owe the singer 10 million euros, because the company would not have adhered to the at-source provision in the contract. That amount “is no finger work”, Petit thinks. “That’s at least an educated guess.”
‘Many artists have no idea whether the compensation is reasonable’
“This could be a deciding factor when it comes to how transparent the music industry should be,” says the lawyer. mr. Probz thinks he’s not the only artist this plays for. Petit confirms this, but also says that not everyone has the financial means to set up a lawyer and an accountancy firm. “The reality is that many artists have no idea whether the compensation they are getting is reasonable.”
Petit is positive about Mr. Probz’s case. “From what I read, they have a good point. Grant Thornton’s studies reinforce that feeling. At the same time, Mr. Probz’s arguments are well-known and we don’t know Sony’s defense yet.” Should the singer win the case, Petit expects many similar charges. “Then the gate is off the dam.”
NU.nl has asked Sony Music Entertainment for a response. The company says it “strongly disputes” the allegations and awaits the trial.
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