On December 16, a relatively obscure U.S. administrative body issued rules with broad implications for online music. Every five years, the Copyright Royalty Board, or CRB, determines the rates that non-interactive services like Pandora and iHeartRadio will pay to stream sound recordings online. The details are dizzyingy complex, but this time around the bigger Internet radio companies generally cheered the ruling, while SoundExchange, the organization set up to distribute these royalties to artists and copyright holders, expressed disappointment. One set of stakeholders, though, raised existential alarm about the new terms: small, independent webcasters. […] read more
Independent labels and artists had something extra to be thankful for this Thanksgiving.
In a November 25, 2015 ruling, the U.S. Copyright Office made it clear that webcasting royalty rates for the period covering 2016-2020 would treat major and independent record labels the same, as has been the case since the the establishment of a public performance right for digital transmission of sound recordings. Last week’s decision, handed down by Register of Copyrights Maria Pallante, is a response to the Copyright Royalty Board’s (CRB) question about whether the federal statute that provides for rate-setting (17 U.S. Code § 114) would permit different rates for majors and indies.
On May 29, 2015, Judge Lous Stanton of the Southern District Court of New York reached a decision in a dispute over rates paid by the webcaster Pandora to the performance rights organization (PRO) BMI. This court oversees rate-setting for songwriters and publishers when their works are “performed” on any form of radio (as well as live venues, bars and restaurants).
Judge Stanton’s ruling sets BMI’s new fee at 2.5 percent of revenue from Pandora, up from the previous 1.75—an increase of 43 percent. However, a separate judge from the same district court reached an entirely different decision about rates for Pandora and ASCAP (the other main PRO). In that ruling, from May 6, Judge Denise Coteheld rates at 1.85 percent.
On its surface, it looks like the judges presiding over each case simply have divergent views regarding what the rates should be. And this may be true, but there are additional factors to consider.
Back in September 2008, we told you about the passing of the Webcaster Settlement Act, which allowed for the implementation of an agreement between copyright owners, performers and online broadcasters on webcasting royalty rates — provided they arrive at mutually-agreed-upon rates by February 15, 2009. read more
You might have run across the handfulofarticles in the last day or so about online “predictive” radio service Pandora adding audio ads. This move is no doubt an attempt to develop a sustainable revenue stream for Pandora’s free services (the company also offers yearly ad-free subscriptions for $36). read more
The music industry reacted favorably to the Copyright Royalty Board’s release Thursday of new mechanical royalty rates. The CRB left unchanged the per-song rate of 9.1 cents for physical product, set for the first time a statutory rate for permanent downloads of 9.1 cents (the same as the prevailing industry standard rate) and established a 24 cent rate for mastertone ringtones (mastertone royalty rates were previously negotiated and typically equaled about 10% of the retail price).
A statement from Future of Music Coalition:
“Future of Music Coalition is encouraged that the parties involved in the proceedings seem pleased with the decision, and looks forward to reading the entire CRB decision when it is made public.
On September 23, songwriters, publishers, record labels and digital music services announced they had reached an agreement on mechanical royalties for songs played on online music services.
Called a “breakthrough that will facilitate new ways to offer music to consumers online,” the voluntary agreement crafted by the Digital Media Association (DiMA), the National Music Publishers? Association (NMPA), the RIAA, the Nashville Songwriters Association International (NSAI) and the Songwriters Guild of America (SGA) ended a longstanding dispute about mechanical royalties for interactive streaming and limited downloads. read more
FMC has been following the back-and-forth about webcasting royalty rates almost as long as webcasting has existed. We’ve always recognized the value of smaller online broadcasters to the online music world — their passion and energy mean an awful lot of music that would otherwise have no outlet can reach ears around the world. We also support the continued development of larger webcast services, particularly the ones with innovative technology that conforms to your personal taste, like Pandora. On the other hand, we believe that artists should be fairly compensated for their work, and that the success of new technologies can’t come at the expense of creators’ interests. read more
The Cold War between SoundExchange and webcasters over the new royalty rates is thawing — at least in part. SoundExchange announced yesterday it had reached a compromise with some large webcasters that will give them a break on the rates set by the Copyright Royalty Board back in March.
The CRB had required webcasters to pay a minimum $500 “per station per channel” fee with no cap. This would add up to a hefty chunk of change for webcasters (such as Pandora) that allow each listener to create a persona web channel. Under the terms of the compromise, each webcasters’ royalty rates will be capped at $50,000 regardless of the number of stations or channels. read more
House Committee on Small Business 2361 Rayburn House Office Building Washington, D.C. 20515
Dear Chairwoman Velázquez:
Future of Music Coalition respectfully submits this written testimony for consideration in advance of the committee’s June 28, 2007 hearing on “Assessing the Impact of the Copyright Royalty Board Decision to Increase Royalty Rates on Recording Artists and Webcasters”. read more