BMI, RMLC Agree To New Royalty Deal
August 28, 2012 at 2:06 PM (PT)
BMI and the RADIO MUSIC LICENSE COMMITTEE (RMLC) have agreed to a settlement concerning the fees payable by the U.S. commercial radio industry to publicly perform BMI's catalog of over 7.5 million musical works through 2016. The settlement, which will require Federal Court approval, would bring an end to the two-and-a-half years of litigation between the parties.
The new BMI license, which runs from JANUARY 1st, 2010 through DECEMBER 31, 2016, features a return to a percentage-of-revenue fee structure and addresses the new media platforms in which the radio industry is increasingly engaged. Among the specifics:
* A $70.5 million industry fee credit against 2010-2011 industry payments;
* A 1.7%-of-gross-revenue fee structure (with simplified revenue reporting) for stations on the blanket music format license, less a standard deduction of 12% for revenue derived from terrestrial/analog and HD multicasting broadcasts and a 25% deduction for revenue attributable to new media uses;
* Retention of the program-period license that benefits many talk-format stations, with a base fee of 0.2958% of gross revenue, less the same deductions noted above; and
* Expanded rights coverage to accommodate the industry’s developing new media platforms related to Internet websites, smart phones and other wireless devices.
"BMI is so proud to represent the world’s best songwriters, composers and music publishers and their incredible contributions to the success of American radio," BMI SVP/Licensing MICHAEL STEINBERG said. "This agreement allows us to move forward without the cost and uncertain outcome of further litigation. While fees will be lower than the prior final agreement, the return to a percentage-of-revenue license will allow us to grow BMI revenues as the radio industry rebounds."
"It is a vote of confidence towards our industry that BMI has agreed to return to the historic percentage-of-revenue fee structure," RMLC Chairman and SAGA COMMUNICATIONS head ED CHRISTIAN said. "Once the agreement with BMI is approved by the Court, radio broadcasters will continue to nurture their longstanding relationships with the performing rights organizations. We will work together to solve mutual problems in an ever-changing environment of both radio and intellectual property rights as it relates to authors, composers and publishers."