Kobalt’s Deal with ElevenLabs to Split Royalties Between Publishing and Recorded Music

Kobalt, the prominent independent publisher, has confirmed that its new deal with ElevenLabs' AI creation platform, Eleven Music, will split royalties 50/50 between publishing and recorded music.

The deal:

• Sources told Music Business Worldwide this deal creates “parity” in revenue.

• The deal includes a Most Favored Nation clause, which means that if a better deal is struck between another AI company and rightsholder, Kobalt’s terms with Eleven Music will shift to the better deal automatically.

• In more common deals, publishing receives ~25% of royalties. Recorded music receives ~75%.

Merlin:

• Independent licensor Merlin also signed a deal with Eleven Music, but those terms are separate from Kobalt’s.

• The terms will be separate from any other licensors Eleven Music may sign with as well.

• According to a note from Kobalt CEO, Laurent Hubert: “100% of the mechanical rights for the composition are controlled by Kobalt, and the corresponding master recording is cleared through Merlin.”

• The deal between Kobalt and Merlin allows music created with Eleven Music to be used in film, television, social media, and other media outlets.