Paper Royalty Statements – Are They Costing the Industry Too Much?

After spending some time recently at a music company I was amazed at the mountains of paper that dominate the office landscape.

So much of the information that flows out of the company doors is paper-based, which creates a huge administration overhead. Some of the paper mailings were so huge they had to be sent in boxes instead of envelopes!  Ironic for an industry whose products are moving so quickly to the online forum.  Perhaps it is time for the back office to go online too…

There is some movement in the industry to provide royalty information online which saves time, administration, manpower and paper.  The main drivers seem to be cost saving, transparency to artists and eco-awareness.  Probably in that order.

I think the ‘Go Green’ mantra is an added bonus – but the true driver is cost saving.  The music industry is going through an evolution – and paper statements with all their associated costs are part of the old world.  It’s time to go online.

Not a huge leap of the imagination. Everyone else from your bank to your phone company allow you access to your transaction information online. So why is it proving such a challenge for royalty information?

Perhaps the industry trend for heavily bespoke computer systems makes it difficult to integrate into the online world and the new technologies that it presents.  Perhaps the complex manual review process of statement content prior to release means that the automatic publishing of statements online is too risky, too transparent.

However, the music industry cannot afford to spend its time and resources on back office processing.  It needs to focus on its products and how to manage the huge change in its marketplace.

To save costs in their back office they need a simple solution that will cater for online statement presentation without requiring heavily bespoke development and investment.

In short, there needs to be an industry wide solution. Not a company by company solution. This step in the industry evolution is inevitable and necessary. Paper statements must go, but the alternative should be a reasonably priced and industry wide statement portal solution. No individual company in the industry can afford the development and infrastructure costs by themselves.