AFM & SAG-AFTRA Fund in the Spotlight at ASCAP Expo

The little-known AFM & SAG-AFTRA Intellectual Property Rights Distribution Fund pays royalties even to oft-neglected session musicians and backup singers.
Tommaso Boddi
Dennis Dreith

Stevie Wonder was the headliner — and closing act — of the ASCAP I Create Music Expo that concluded this weekend, but musicians and singers will be interested to know that an obscure fund, jointly run by the American Federation of Musicians and performers’ union SAG-AFTRA, also had a moment in the sun at the annual conference for songwriters, composers, artists and producers.

If those two unions seem like an odd pairing, they aren’t: since its 2012 founding by way of merger, SAG-AFTRA, like AFTRA before it, has represented recording artists — singers — as well as actors and others, such as broadcasters.

The joint fund, the AFM & SAG-AFTRA Intellectual Property Rights Distribution Fund, distributed about $60 million in royalties in 2016 and thus will be welcome as anything but odd by those who receive checks from it — a variety of singers and musicians, including such non-featured performers as backup singers and session musicians, who otherwise might not receive music royalties at all.

Although that total is far less than the approximately $1 billion in residuals that SAG-AFTRA distributes annually, and is also less than the $90 million to $100 million in audiovisual AFM residuals that are disbursed each year (which are administered by yet another organization, the Film Musicians Secondary Markets Fund), the checks can be significant, ranging up to $1 million in some cases, said fund executive director Dennis Dreith.

“We do for non-featured performers what SoundExchange and AARC do for featured performers,” explained Dreith, referencing two other music royalty organizations. He spoke to The Hollywood Reporter after conducting a seminar Friday for about 100 people at the Expo.

One recipient of a payment from the fund was so unaccustomed to receiving royalties that she rang up Dreith and asked if she was really allowed to cash the check. He assured her that she was.

Citing the case of a former Motown session bass player who he said died impoverished after helping churn out hit after hit (“You Can't Hurry Love” by The Supremes, “My Girl” by The Temptations, and dozens more), Dreith added that the fund helps ensure that “there won’t be another James Jamerson,” at least in the economic sense.

Where the Money Comes From

Unlike Expo organizer ASCAP, which collects and pays royalties to songwriters and composers, the joint union fund is for performers. It was established in 1998, which may give a clue as to its initial scope: the royalties are collected from U.S. digital platforms, but not from U.S. terrestrial (conventional) radio, as to which there is no provision in law for performance royalties. The Fair Play Fair Pay Act, which the fund and unions vigorously support, would change that and require AM and FM stations to pay such royalties, too.

Those for-now digital royalties are paid to non-featured vocalists and non-featured musicians regardless of their union membership or affiliations. The fund collects foreign performance royalties for U.S. non-featured performers as well, but only for members of AFM and SAG-AFTRA.

That, anyway, is what the sound recording division of the fund does. Two more recent arms, the symphonic royalties and audiovisual divisions, represent evolutions beyond digital-only. The first focuses on royalties for featured and non-featured performers in symphonic sound recordings, including archival recordings and radio broadcasts licensed for use on cable, satellite and digital media. And the audiovisual division collects royalties — again, for featured and non-featured singers and musicians — from foreign territories for films and television programs containing U.S. performers ,which have been broadcast on Spanish and German television, and motion pictures containing U.S. performers, which have been exhibited in cinemas in Spain.

There is no word on whether that limited geographic portfolio might expand.

Like residuals, which inspired this reporter to prepare a colored chart that Backstage likened to “a periodic table of elements on mushrooms,” music royalties are complex: a flowchart in the ninth edition of Harold Vogel’s definitive Entertainment Industry Economics, which features almost two-dozen circles, squares and other shapes and a similar complement of connecting lines, looks like an oil refinery diagram — except that the latter is easier to understand. Indeed, turning bauxite into aluminum is apparently simpler than the way money flows in the music business. But in one small corner, at least, the AFM & SAG-AFTRA fund has it covered.

 

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