GEMA to lower its commission on digital music payouts to 7% by 2027
The German collection society plans to lower its commission on all on-demand music distribution in stages.
GEMA has announced a significant change to the way it handles online royalties. By 2027, the German collection society will reduce its commission for music-on-demand services from 10% to 7%. The move is expected to add more than €6 million each year to the payouts received by its members.
The shift won’t happen overnight though. From January 2026, the commission rate will fall to 9%, before reaching the 7% target the following year. This applies to royalties collected from platforms such as Spotify, Apple Music, Deezer and YouTube. GEMA has confirmed that even the first reduction will see members benefit from an extra €2 million annually.
Streaming has become a vital revenue stream for the society’s members, with digital uses generating €310 million in 2024. That figure made up nearly a quarter of GEMA’s total revenue. Recognising this, the organisation has invested heavily in digital processes and automation to make its systems more efficient.
Thomas Theune, GEMA’s Director of Broadcasting/Online, explained, “A successful collecting society is measured, among other things, by how much money it distributes to its members. The reduction of our online commission is further proof of our strong contract conclusions and our operational performance.” He added, “Thanks to digital processes and fully automated data processing, we can already license and distribute more efficiently than ever before. This allows us to pass on more money to our members. This is our mission as a modern collecting society: to put technology at the service of creatives.”
By becoming the first major European society to reduce administrative costs for online rights below 8%, GEMA is setting a precedent that others may feel pressure to follow. In fact, there has already been movement in this direction elsewhere. For example, PRS for Music lowering its administration fees to 8% last year demonstrated how such decisions can directly benefit rightsholders.
Music Business Worldwide points out that alongside its focus on digital royalties, GEMA has been active in addressing the rise of artificial intelligence in music. The society has developed licensing models aimed at AI providers and has launched legal actions against companies including OpenAI and Suno over the alleged use of protected works without permission.
With over 100,000 German members and more than 2 million copyright owners worldwide, GEMA’s decision to reduce its online commission is designed to ensure that a greater share of revenue from streaming and downloads flows directly to the people who create the music.