How Artist Compensation Works

STEM.FM pays rights holders from real subscription revenue, based on what subscribers actually listen to. The system behind this is called TBACS (Time Based Artist Compensation System). This article explains what it measures and how money is allocated. It applies to every track on the platform.

How listening is measured

• While a track is audibly playing, it earns one credit per second of playback.
• STEM.FM is a mixing platform, so stems from two tracks often play at the same time. A second of simultaneous playback is split evenly between the tracks involved; nothing is double-counted.
• Time when a track is muted or isolated out of the mix earns no credit.

How royalties are allocated

Royalties are calculated monthly. Each subscriber’s payment (net of tax) is divided across the tracks that subscriber listened to during their billing period, in proportion to credited listening time. Those per-track amounts are then pooled and paid out to each track’s rights holders.

• Master (recording) rights and publishing rights are accounted separately, so a track can have different owners on each side.
• Ownership can be fractional and territorial: if you own 60% of the master rights in a region, you receive 60% of that track’s master allocation for listening in that region.
• Yearly subscriptions are spread across the months they cover rather than landing in a single month.

What if a track has no registered owner?

Its royalties are still calculated in full every month and set aside; they are not paid to anyone else. When a verified owner claims the track, the held amount for their share is released to them. See Royalties for Unclaimed Music for details.