SoundExchange Wanted Higher Sat-caster Royalty Hike
December 5, 2007 at 5:41 AM (PT)
Yesterday's COPYRIGHT ROYALTY BOARD's (CRB) determination to raise royalty rates for sat-casters to 6% for 2007 and 2008, and eventually up to 8% in 2012, was only nominally welcome news to label arm SOUNDEXCHANGE
In a statement released to the press that initially praised the decision for "validating the overwhelming evidence presented by SOUNDEXCHANGE regarding the critical importance of music to satellite programming," the group nonetheless wasn't satisfied. "This result once again highlights the inequity of a rate standard that forces creators of music to subsidize certain music services with below market rates," said SOUNDEXCHANGE Exec. Dir. JOHN SIMSON
The SOUNDEXCHANGE press release noted that the CRB initially considered the benchmark for satellite radio as 13% of subscriber revenue, but "Congressionally-mandated standards that the CRB followed ultimately led it to set rates at half the value it determined artists and record labels would have received in the marketplace."
SOUNDEXCHANGE argued for rates starting at 8%, with unspecified increases in following years. "We are glad that the decision affirmed the importance of music to XM and SIRIUS, but disappointed that the rate standard led to a lack of full and fair compensation because of the business circumstances created by XM and SIRIUS," added SIMSON.