As revenues from sales of traditional media have plunged, the music business has been looking for alternate ways of making money from its products, including a variety of subscription services, ad-supported streams, and blanket licenses. The focus of these efforts has largely been on how to ensure that revenue gets collected by the industry in general instead of disappearing into the black hole of piracy, but there's a related issue that doesn't receive as much attention: how that money gets distributed once it's collected. In an attempt to highlight this issue, the Future of Music Coalition has released a set of principles for the compensation of musicians. Although the document focuses on money from new distribution models, it reads much more like an effort to rewrite the rules of the entire business.

The most critical aspect of this probably occurs in the statement on "direct payment." Here, the principles say that any transfer of revenues to copyright owners are limited to three years. This would eliminate one of the common business practices, in which record companies would pay for recording, distributing, and promoting music, and then count that as a debt that entitled them to recoup their costs from the artists' share of any profits. Were these principles adopted, the labels would have three years to get their costs back, after which they can write it off. The concept of direct payment is meant to ensure that the labels would never have access to this money in order to take their share past this point.

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