Record labels will start reaching into the pockets of Twitch DJs

Licensing fees are coming to creators with monetized streams this summer.

Unsplash / Gabriel Barletta

Twitch has entered into a first-of-its-kind partnership with all of the major record labels that will force DJs who monetize to pay a fee to use songs in livestream sets. The actual percentage being paid out to these labels is being kept under wraps and varies according to the chosen monetization method, but the DJs and Twitch will reportedly split these fees 50/50. The company also says that it'll cover more than 50 percent at first, but didn't get into numbers.

Twitch will also be offering a one-year subsidy to select DJs to help cover the difference between earnings and money paid to labels. The company didn’t announce how it would award these subsidies or if it would cover all of the required licensing fees. It did say that the subsidy amount would reduce over time as the program increases in popularity. There are thousands upon thousands of DJs on Twitch, so it’d be nice to get a little bit of clarification here. We’ve reached out to the company and will update this post when we hear back.

There’s a sliver of good news here. This move is only for DJs who monetize their streams. If you’re an amateur record spinner, you won’t have to pay out of pocket. The labels will still get money from these streams, because non-partnered channels still contain ads, but Twitch will cover the costs. It remains to be seen just how long the company will continue this act of altruism.

Why did Twitch do this in the first place? The company says the previous model, which didn’t pay out to labels or artists, was “not sustainable,” calling out a “variety of copyright issues that need to be considered that vary across regions.” Twitch says it's trying to avoid DMCA takedown notifications and copyright penalties. Up until this point, DJs have been personally responsible for dealing with these issues.

The program officially goes live this summer, along with a new DJ category for streamers. As a note, the aforementioned deal is with the record labels and not the actual artists. I’m sure these labels will fairly distribute funds to the creators in a timely fashion. That was sarcasm.