In the physical era of the music business, figuring out how many LPs, CDs, or cassettes an artist had actually sold was mostly a game of guesswork. Records were manufactured and shipped off to stores, but it often took years for unsold stock to trickle back as returns. Sales tracking systems were filled out by hand – making human error inevitable – and a mysterious tax called “breakage” was standardly deducted from every release.
Dating back to the days when fragile discs were pressed on shellac, “breakage” quickly evolved into a convenient excuse to cover up a multitude of accounting sins and inventory shrinkage across borders. Navigating international distribution networks and tangled licensing deals turned royalty accounting into a total financial Bermuda Triangle.
The closest an independent act could get to uncovering their true sales numbers was to formally request a contractual audit. But these audits were convoluted, expensive, and rarely managed to track down the full scope of lost, damaged, or hidden stock.
Even The Beatles had to sue
Not even the absolute giants of the industry were immune to this systemic lack of clarity. In 2005, Apple Corps, representing The Beatles, famously sued EMI and Capitol in London and New York. They claimed a massive £30 million in unpaid royalties had vanished between 1994 and 1999, a wildly lucrative period fueled by the success of their Anthology series.
The bitter legal battle dragged on until late 2007, and it was only after the settlement cleared the air that The Beatles’ legendary catalogue was finally allowed to land on iTunes in November 2010.
If the most iconic band on earth had to spend millions in court just to see their true numbers, the average independent musician didn’t stand a chance. Lacking the financial resources to wage a legal war against corporate legal teams, most independent acts simply backed down or accepted lowball settlement payouts.
The transition to the digital era promised to change everything. With digital delivery, overproduction of physical stock vanished overnight, there were no returns to wait for, and theoretically, every single play could be tracked, counted, and paid out.
The foundation of digital trust
At a time when transparency was not yet a defining feature of the recorded music business, Believe’s founder and CEO, Denis Ladegaillerie, viewed access to data as a fundamental component of the relationship between artists, labels, and their distribution partner. Rather than treating reporting as a back-office function, Believe integrated transparency into the design of its services from the outset.
To turn this philosophy into a working reality, Believe officially launched Backstage in 2010. It was the industry’s first real-time data interface engineered explicitly for artists and labels to manage, promote, and monitor their music with full operational clarity.
Opening the hood on royalties
[Royalties are] something very important for the artist. It’s basically their salaries. They want to know with full transparency, and with full accuracy, how much they made on a streaming platform. It’s as simple as that.
Romain Becker
Chief Product & Operations Officer
Backstage brought an unprecedented level of fairness to a marketplace that had historically thrived on keeping artists in the dark. It shifted the power dynamic by turning automated streaming statistics into real-time ledger balance updates.
“One of the things we’ve been focusing on and that has been a high level of priority was royalties,” says Romain Becker, Believe’s COO. “This is something very important for the artist. It’s basically their salaries. They want to know with full transparency, and with full accuracy, how much they made on a streaming platform. It’s as simple as that.“
Yet, capturing that data stream required building an engine capable of untangling an entirely new web of digital complexity.
“The calculation of royalties for artists is something that is quite complex,” says Romain Becker. “You have multiple sources of royalties today, such as streaming, social networks, downloads, various types of rights and so on. So the sources are very complicated. The deal that you have with Believe might also be a little bit customised. So you may have a certain level of royalties in year one on an album, then another level of royalties in year two on another album.“
The artist’s digital financial dashboard
“This is how you create trust with the artist […] if they observe a difference between the public numbers of streams they have and the payouts they get at the end of the day, the trust is destroyed, and the relationship with their record label just doesn’t work.
Romain Becker
Chief Product & Operations Officer
Because tracking multi-platform digital micro-royalties is an administrative headache, Believe’s objective was to handle the heavy technical lifting so artists could stay focused on the studio.
“Artists don’t bother calculating their royalties,” Romain Becker says. “They just don’t want to do this. It is painful and very uninteresting for them.”
By translating complex global data feeds into a simple, interactive dashboard, Backstage effectively gave the modern artist an online financial dashboard for their intellectual property.
“We are connecting the dots between how an artist wants to structure a deal with Believe and how they want to see the royalties on the back end”, he explains. “So every artist has access to a back end, like you do with your bank. You can see how much revenue you have and how it’s evolving. We’re offering a complete solution so artists can see and understand their payouts with 100% accuracy and full transparency.”
Ultimately, this structural clarity became Believe’s most effective tool for building long-term retention with independent communities.
“This is how you create trust with the artists. If artists don’t understand, or if they observe a difference between the public numbers of streams they have and the payouts they get at the end of the day, the trust is destroyed, and the relationship with their record label just doesn’t work. You must build a complete royalty management system that is accurate, transparent and very simple.“
Setting sights on a global playground
The need for real-time transparency became even more pressing as the wider digital consumer ecosystem exploded in 2010. Apple expanded mobile screens everywhere by launching the first iPad in March, and a new photo-sharing platform named Instagram debuted in November, completely reshaping how fans directly connected with artists.
The digital music landscape was also shifting on a global scale. In April 2010, Gaana launched its music service in India, an early indicator that the local digital market was preparing to catch fire. Believe was already keeping a close eye on the region’s massive digital promise, quietly assembling the operational pieces to establish a local footprint and open a dedicated office in India within the next three years.
By transforming transparency from an accounting exercise into a cornerstone of the artist relationship, Believe was strengthening the foundations of a business model built to scale across an increasingly global and data-driven music industry.
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Article written by Eamonn Forde. Eamonn Forde is an award-winning music business journalist and author. He writes for The Guardian, Forbes; Music Week, and Music Business Worldwide and several other publications.
