Audio authors: Q&A about Envato third-party distribution and licensing

Hi all!

If you sell audio content on Elements or AudioJungle, you will have received an email update today about the distribution and licensing of audio content on Envato.

This follows a year after our initial announcement about third-party licensing and distribution. Over that time the audio landscape has continued to evolve, and we feel it is time to take the next step in exploring incremental third-party revenue streams for audio.

In last year’s update, we also announced that we would provide audio Authors with written notice and the ability to opt-out of Envato’s future plans to use audio items in any third-party licensing and distribution deals. Details of that opt-out process are contained in today’s email.

If you have questions after reading the email, please ask them here. I’ll be compiling everything from this thread and raising them with our project team, and will share answers here as they become available.

FAQs

How long do I have to make a decision on this?

If you do not want your audio content included in any third-party distribution or licensing plans, you can opt out via the link in that email. If you decide to opt out, you have until midnight Monday 29 July, 2024 (AEST) to do so.

If I opt out of third-party agreements for audio, can I continue selling music and sound effects on Envato?

Yes. Opting out of third-party agreements will not impact your ability to continue selling your items on Envato as normal.


Updates added on 4 July in post #40 (link)

Does this apply to both Music and Sound Effects audio content?

Yes. All our current Audio content types are covered, as we would like to explore potential new revenue streams for Music and Sound Effects authors. From 2 August 2024, we will be including audio content as part of our third party distribution and licensing plans, unless you have explicitly chosen to opt out of these third-party agreements prior to 29 July.

Why is Envato asking Authors to opt in or out before any details are available?

Before we can start to discuss partnership opportunities with any third parties, we need clear data about how many Audio items are potentially available for use. This is why we’re notifying you now. As this step must take place before any discussions can begin, we cannot speculate on the details of what any future deal might involve.

Can I change my opt-in status after July 29?

No. Once we finalize the list of items that we can pursue third-party deals for, we will not be adding or removing content on an item or Author level. This is not feasible given the scale of our community: we have tens of thousands of Authors in our community, and it will not be possible to conduct any third-party discussions while the number of items is in constant flux.

Why is everything included in a single opt-out process?

We are combining all potential 3rd-party distribution and GenAI-related licensing into a single opt-in process to simplify this, due to the number of different Authors and items involved. This gives our team a clear number of items that they can enter discussions and pursue new revenue opportunities for, and flexibility in how they seek these opportunities.

How will Author earnings be affected by this?

Your item distribution on Market and Elements is not affected by your choice to opt in or out of third-party distribution and licensing. Any revenue generated from third parties will be additional revenue, above and beyond what you earn directly on Envato sites. You will see this on a separate line item in your earnings report that will reflect any revenue generated by third-party partnerships.

How can I change my response if I have already submitted the Opt-Out form?

Please open an Author Support ticket and use it to provide updated information before July 29, so that we have an official reference for your request.


July 12 updates in post #135:

Why are we doing this now?

By providing Audio authors with the ability to opt-out of third-party arrangements by July 29, we will have clarity over the total number and types of audio items that we can explore third-party licensing and distribution deals for, from August onwards.

Our industry is undergoing significant disruption, and the current opportunities are changing rapidly. There will be potential for new ways to generate revenue and earnings for our Author community. But in order to effectively pursue these new opportunities and beat the competition, we need the ability to move quickly and adapt. This is the first step in that journey.

What do you mean by “third party arrangements”?

This term covers any use of the content you license through Envato, on sites outside of our ecosystem. As discussed in our Author Hub article, this could include:

  • Developing generative AI models
  • Augmenting a partner’s content offering with our library
  • Integrating content into creative tools

A note on partnership selection, scale and speed:

It’s important to note that we are working to ensure that any potential partnership offers worthwhile benefits to all parties: we’re looking for partnerships that are complementary to our primary business, involve working with reputable companies, and can generate meaningful income for both Envato and the Author community. This takes time, as we will not jump at every potential offer.

While selecting partners to work with is a slow process, when discussions do commence things can move very quickly. This is why we need to establish a clear number of items that we have permission to use in third-party arrangements.

At the stage when a deal is under consideration, it will not be possible to go back to adjust the content that is available. The Envato community involves thousands of Authors and millions of items, and the process of contacting and seeking usage permissions from our full community takes several weeks. This is why we’re establishing permission up front, so that our commercial teams can move quickly later on.

Would third-party earnings be ongoing or one-off payments?

Both options are possible, and would depend on the specific partner and their usage. Without having full details of future arrangements, we cannot provide you with details of fee structures. Compensation and the share will be subject to the terms negotiated with third party partners, but our intention will always be to ensure those terms are as favourable as possible.

Can authors who use virtual instruments and sample libraries license their music for AI training?

Envato cannot give advice on the T&Cs of the range of tools that may be used by our authors. If you are unsure whether your tools allow the license of your music tracks (“derivative works”) for AI training, we recommend that you check directly with those tools to confirm what is permitted.

This list of FAQs was updated on July 4 and July 12 - we’ll continue answering more questions next week

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Will our inclusion in a third-party distribution or licensing plan have a positive impact on increasing our revenues? Incomes have fallen alarmingly :frowning:
When will our works found on AudioJungle be included in the element side?

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It’s a pity we don’t have the opportunity to test this update before making a decision.

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I just received the email, and I’m confused.

We’re being told that we can opt in or out of something we know absolutely nothing about.

Are there any details at all that will be revealed as to the terms of the aforementioned third-party licensing and distribution deals?

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What do you mean? How would that even work? Once your music has been fed to AI, there is no taking it back.

The real pity is that once again, we are asked to agree to something that has not been defined. We don’t know what the compensation, nor the share of that compensation, will be. That’s the pity and the crazy part. No sound of mind author should agree to this. The only reasonable option is to opt out.

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That’s the biggest issue to me, you have to give all your tracks for AI learning, but you don’t know how much it will pay, and if it’s $2, you can’t cancel it. Will there be a steady stream of royalties every time your track is being used to create a another with AI? Or will the AI be taught once and that’s it, it already has the data and wont pay you again?

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This is our end.

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Why don’t you call it what it is? It is giving our music up for TRAINING AI systems that will eventually replace us. To any authors - you should opt out of this if you have any appreciation for music.

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Please provide more details regarding the new changes and plans, as much as possible. We need to understand what we are agreeing to or not. What are the new distribution channels? Is there a risk of losing control over Content ID? Is there a risk of losing rights to our compositions? Is there a risk that our compositions or parts of them will be used in other musical works, and will I face any issues with the rights to my work because of this?

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I’ve already asked the question here once. What happens if an author sells the full rights of a file to Netflix, for example? It then deletes this file on all pages. What about the third parties. They would then have a problem with Netflix.

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What is meant by distribution? I have already distributed my music on all platforms like Spotify, Pandora, etc. And it is a good source of income; I don’t want to give it up. Could I have problems because of this? Honestly, I’m totally confused.

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Will Envato communicate what these revenue streams look like and how authors would be paid? At first glance, Envato states

How will payments work?

You will be paid whenever Envato receives payment by a third party for the permitted use of your Market and/or Elements items as part of a third party arrangement.

You will see this additional usage reflected in your Earnings Statement.

Without having full details of future arrangements, we cannot provide you with details of the fee payable to you, the Author.

Ben, How can Envato expect Authors to “Opt into” a potential earning opportunity without knowing how much nor when we’d be paid?

Will this AI opportunity provide recurring royalties paid every month? Or will the revenue be shared only once for each dataset ingestion made? Your company is literally giving no details whatsoever about compensation. It’s akin to accepting a job under the terms 'We’ll pay you whatever we feel like paying you, whenever we decide to pay, and that pay can actually be $0 if we so decide" …

Am I missing something in the way Envato is communicating about the AI ingestions that are part of your future plans?

Are you making deals with SUNO and UDIO who are currently getting sued for copyright infringement for ingesting music files without permission from original authors and publishers and rights holders?

Are there risks to CID claiming copyright infringement to these future AI outputs trained off of my music?

There are so many “unkowns” in this 3rd party distribution and licensing deal. Envato has to communicate exactly **how authors would be paid? and HOW OFTEN WILL WE Be PAID? and HOW MUCH MONEY WILL WE BE PAID? WHAT IS THE “METRIC” FOR PAYMENT? HOW is that METRIC determined in this new deal.?

As it stands now, payment metrics are very clear for me: I sell a license on the audio jungle platform to a customer, the customer pays Envato $39, I earn a portion of that $39 for that music license sold. I am paid those royalties from each license sold on the 15th day of every month. This payment structure is very clean, and provides clear, easy to comprehend communication about the transactions. The future AI dataset ingestions revenue streams are not being clearly communicated as to how music authors will be paid, nor how often, and lastly…is it a recurring monthly royalty revenue structure? Simply asked

  • What are the third parties offering as compensation to music producers willing to ingest their catalogs (all wave files) and associated titles, keywords, and descriptions into an AI learning model?
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I’m leaning towards opting out as we don’t know the details indeed.
Also members of PROS be careful if you can even opt in…I know some PROs have taken a clear stance on AI.
Review your membership contract.

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How can anyone opt into a revised contract that does not explain how the author can earn money?

You will be paid whenever Envato receives payment by a third party for the permitted use of your Market and/or Elements items as part of a third party arrangement.

  • When will I be paid? How often will I be paid? What will I be paid? What is the metric or event that takes place to earn any form of payment? Is this a recurring monthly royalty? A one time payment?

You will see this additional usage reflected in your Earnings Statement.
Without having full details of future arrangements, we cannot provide you with details of the fee payable to you, the Author.

If I can not be provided with details of the fee payable to me, How do I and all music authors benefit from this opportunity on any level? The language seems to allow Envato the ability to not pay anything at all because “Without having full details of future arrangements, Envato cannot provide authors with details of the fee payable to them, the Authors.”

This is insane! totally absurd! I have never seen a deal presented like this, ever in my life!

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It’s understandable to have questions and we’ll answer them the best we can. The difficulty is with giving estimates before any deal has been made. Particularly when we don’t even know the amount of items we’re looking at yet. But we’ll try to give as much clarification as we can.

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You need to separate this into (at least) two options:

  1. AI related deals.
  2. Third-party licensing deals (nothing to do with AI).

Obviously, we would also need to know whether you would allow distributing to Spotify etc., sampling, covering, Content ID… Endless things that we can’t just agree to all at once.

Right now, it seems like you’re making this an all or nothing situation (AI + other, or nothing) so that we will agree to our music being included in AI dataset scanning.

Stock sites are of course very useful to AI companies since we provide keywords and descriptions along with the music. Something that is a bit harder to come by elsewhere.


Regarding compensation. Pond5 did this without asking and you won’t get much from AI. It will also just be a one-time payment (per company), because paying out per usage in their future generations will be admitting to micro sampling. Won’t happen.

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I have to say that I do appreciate the opt-out option and timely announcement. That’s an improvement so that’s cool and should also be said.

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I want to refuse too.And he will take our work tomorrow.

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To All Envato Music Authors: If ENVATO can not or will not state how you will be paid nor who the "3rd party AI folks: are…nor can they state whether or not a recurring royalty is going to be paid or whether a fee per track ingested into AI is going to be paid, nor how much…we all have no choice but to Opt Out.

The risks are too great:

Once SUNO and UDIO get access to our music, that music essentially becomes theirs to do whatever they feel like doing with it forever. You essentially are handing over your property to them to learn from.

That’s fine…but at what cost? What price do YOU need to be paid to transfer your property over to the AI monster?

I can not accept this deal unless I am paid an enormous amount of money to teach / Train AI models with my intellectual property (My Sound Recordings, KEYWORDS, TITLES, DESCRIPTIONS).

The other risks are inadvertent CID claims from AI outputs trained by your music that sound similar to your music!

This already is happening with AI tracks released to YOUTUBE!

AI Tracks are getting tagged with copyright claims!

So I delpore all of you to opt out of this deal until ENVATO can explain the royalty/ compensation model to those interested in feeding the AI beast your music property.

Be careful! Once they ingest your music, you lose an enormous amount of control over your unique sound recordings (YOUR INTELLECTUAL PROPERTY). These ingestions and teachings to AI can not be unwound. Once the ingestion occurrs, its done, forever. Your music is teaching AI about your rhythms, patterns, chord progressions, harmonies, melodies, mixing, mastering, keywords, descriptions, and titles…Everything that was once YOUR DATA, is now THEIR DATA to exploit for compensation “unkown” as it stands right now.

In my opinion, everyone should ask for at least $1000 per ingested track to teach/ train AI.

Generative AI music by suno and udio has a goal to eliminate music royalties paid to humans!

Don’t you get that?

So If you are prepared to give up your future royalties, you better set a price of $1000 per track. Your royalties are going to $0 from stock music
licensing in probably 3 to 5 years if the AI monster eats everyones tracks and trains off of them. Is that not clear as day to all in this industry?

My 2 cents on the matter.

King Dog…Where and how do we opt out of this “AI Training and mass ingestion of data” deal? I will be smashing the opt out button if your company can not clearly explain how music authors will be be paid.

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