In September, tracks older than 18 months accounted for an implied 58.9% of Korea’s top-400 digital usage. That makes older recordings a practical focus for a catalogue buyer, including the question of how much income depends on audio whose origins have not been documented.
An artificial intelligence (AI) audio check can identify that exposure before a catalogue deal closes. The useful result is not a count of flagged tracks. It is a ranking of the income attached to each flag, followed by a decision about what the seller must document and which risk the buyer is willing to carry.
Start with the income, then inspect the audio
A catalogue can contain many recordings with different earnings. Giving every recording the same audit priority would spend equal time on unequal financial exposure. Instead, put the earnings record beside the audio inventory and begin with the tracks that contribute most to the income being purchased. That follows the income-weighted approach to flagged tracks in catalogue due diligence.
For an independent label considering a sale, the same order helps before a buyer enters the room. Identify the recordings that drive the proposed deal, gather the documentation for their audio, and resolve gaps while the label can still explain how each recording was made and delivered. A buyer can use that order to decide where further review will affect the transaction. The point is to connect a question about a recording to the cash flow that recording contributes.
The Korean top-400 figure measures digital usage, not catalogue earnings. A buyer therefore needs the target catalogue’s own income records before using listening patterns to set an audit priority or a price. The 58.9% figure shows why older tracks deserve attention; it cannot supply the royalty amount at risk in a particular deal.
A detection flag starts a documentation request
An audio scan can expose earnings tied to recordings that nobody has documented. That is a useful diligence finding, but the next step belongs to the rights file. A detector flag cannot establish who made a recording or who owns its rights. Treating the flag as a final ownership decision would skip the work needed to understand what the buyer is acquiring.
For each flagged recording, the buyer should ask the seller to connect the delivered audio to its creation and rights documentation. The answer should be recorded against that track’s earnings, so the parties can see both the unresolved question and its financial weight. If the seller supplies a clear record, the buyer can close that item. If the documentation remains incomplete, the parties can address that specific exposure in the transaction instead of treating every flagged recording alike.
This also gives a selling label a concrete preparation task. Assemble the records for its highest earning audio first, then work down the income ranking. A complete file for a low earning track does little to answer a question about a recording on which much more of the proposed purchase depends.
Put each unresolved item into the terms
The available responses are distinct: an AI diligence scan can feed into escrow, indemnity or price terms before closing. Each places the unresolved issue somewhere different in the deal. The parties should choose a term by looking at the earnings attached to the recording and the documentation still needed, rather than applying one deduction to every detection flag.
- Price: Adjust what the buyer pays when an unresolved recording changes the income the buyer is prepared to value.
- Escrow: Hold back an agreed part of the payment while the seller provides specified documentation or resolves a specified issue.
- Indemnity: State which party bears an agreed consequence if a defined rights problem later produces a claim.
These choices need a track-level record. The buyer should be able to point from the flagged audio to its earnings, the missing documentation and the proposed term. The seller should be able to see exactly what would resolve the item. That makes the discussion about identifiable income and responsibilities, rather than a general discount for an uncertain catalogue.
Make the audit repeatable
A usable diligence schedule has one row per recording under review: its income, the audio finding, the documentation requested, the seller’s response and the resulting deal decision. Sort it by income. Where several flagged tracks contribute earnings, that order tells both parties which questions to settle first.
The decision an independent artist or label can apply before seeking a catalogue offer is straightforward: start the audio and rights file with the recordings that earn the most. For a buyer, use that same ranking to decide where to spend diligence time and where a finding belongs in the contract. Weighting flagged tracks by earnings turns an audio scan into a negotiating record, while keeping detection separate from ownership ensures the proposed terms address the actual unresolved question.
