It's been standard since the late 60s for producers to get a royalty on the records they produce, but they had to negotiate their own deal with either the record label or the act they were working for. Engineers rarely had a deal for royalty points, and when they did it was for a substantially smaller amount than the producer.
The AMP act would create a statutory right for producers and engineers to receive royalties from digital sales and streaming. This would be handled through Sound Exchange.
Producers have increasingly found it difficult to get paid in recent years, since their royalty stream was based on physical sales and usually not on digital. As a result, they've had to exist on the advances they received, which have shrunk since budgets are generally much smaller than in the past, except in the case of superstar acts.
Sound Exchange collects from radio-like streaming services like Pandora, SiriusXM and cable TV and splits the revenue 3 ways; 50% to the copyright holder, 45% for the artist, and 5% for non-featured musicians like studio musicians.
The AMP Act proposes that 2% be set aside for the producer and engineer, and that will come out of the artist's 45%.
So many producers and engineers have been responsible for making some major hits what they are, yet there are many cases of them not even being credited, let alone paid for the success of their work. The AMP Act hopefully will finally make it happen.
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