SoundExchange currently lacks a[n easy] mechanism for allowing artists or labels to opt out of its royalty collection processes [update below]. If you're, say, a polka artist, and you don't want webcasters who support polka music to have to pay in order to stream your music online, you need a way to tell webcasters that its OK not to report the playback of your music to SoundExchange. Otherwise, they'll collect on your behalf anyway, and after three years, SoundExchange will pocket the unclaimed money.
The Polka America Corporation offers a licensing program that apparently solves the problem. Any polka band can register to allow their songs to be played for free by any polka music webcaster or terrestrial radio operator that plays more than 50 percent polka music (with an online simulcast).
Registered bands -- and the songs they want the license applied to -- are listed in an online database, so that qualifying webcasters can find out which bands are safe to play without paying SoundExchange for the privilege, although they'll still owe publishing fees to BMI, ASCAP, and SESAC.
According to Polka America Corporation, SoundExchange has asked for a list of webcasters who are going to be using this repertoire, although participating stations and websites are not required to register on the site. Hopefully, SoundExchange will get the hint, and offer an easier way for non-polka artists and labels to opt out of royalty collection for certain songs.
Update: As Larry Simpson points out below, SoundExchange does allow the owner of the Sound Recording (artist or label) to negotiate licenses directly with individual webcasters as long as they notify SoundExchange of the arrangement. This Polka America Corporation license appears to make that clause easier for polka players to use.
Another Update: Michelle Genrich, president and founder of Polka America Corp., tells me that although SoundExchange's opt-out process is not set in stone, the organization was helpful when she asked for help in setting up her organization's opt-out database. Score one for SoundExchange, although I think it'd be more straightforward from a copyright holder perspective if SoundExchange ran its own opt-out database.
