Last.fm Starts Paying Royalties to Unsigned Bands

Online music service Last.fm today announced that it will start paying out royalties to unsigned and independent bands that upload their music to last.fm. Artists will earn royalties whenever their music is played on-demand, or on Last.fm's streaming radio service. Last.fm had first announced this in January, but it took until today for Last.fm to officially start up its Artist Royalty Program.
According to Last.fm, artists have uploaded close to half a million tracks since the program was first announced. When uploading a song, all artists can choose to opt into the Royalty Program.

So far, Last.fm has been completely ad-supported, though a premium subscription service is currently in beta. Judging from the payout schedule, however, artists will need a lot of plays on Last.fm to make a reasonable amount from the program. On the other hand, though, MySpace pays out royalties to the major labels, but doesn't pay any royalties to unsigned bands on its site.

Not everybody seems to be happy about this announcement from Last.fm, though. Merlin, the "world's first global rights body for independent music," which represents close to 8% of the US music market, has issued a statement to its roughly 12,000 members, telling them that Last.fm has failed to address its concerns about copyright infringement on Last.fm. Merlin also argues that the license terms of the Royalties Program are too ambiguous.

Regardless of Merlin's objections, though, Last.fm's step to start paying out royalties should be applauded, as it gives musicians yet another way to make money outside of the mainstream music business. While the Royalty Program is limited only to Last.fm and doesn't collect royalties from various sources in the way SoundExchange would, Last.fm is giving musicians an alternative to the more traditional revenue models, which should prove to be especially appealing to smaller, still unknown bands.

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