SoundExchange streaming royalties deal
p2pnet news view | Radio:- A settlement has been announced between SoundExchange and the National Association of Broadcasters (NAB) on performance royalties from Internet streaming simulcasts of their terrestrial broadcasts.
What was perhaps most shocking about the announcement was: it didn’t come as a complete surprise to the NAB. For once, it appears the SoundExchange actually negotiated something rather than simply issuing a press release.
But the announced rates are something of a puzzle.
Although there appears to be a discount from the CRB-established rates retroactively to 2006 and forward to 2010, there’s an escalation clause that covers 2011-2015 that doesn’t seem to do the broadcasters much good in terms of reducing their royalty obligations.
Of course, having a settlement go out that far into the future will save them all those legal fees sure to result from the next round of CRB hearings (which have been mooted for NAB members by this settlement) so there is that to consider.
For artists, the settlement is a good thing because the settled rates will be included in the statute.
This means that the recording artists heard on NAB simulcasts will be entitled to 45% of the royalty revenue.
Of course, because they have to count on SoundExchange to pay out that share, whether SoundExchange actually bothers to find them is anybody’s guess.
However, my outsider’s guess here is: there’s still another shoe to drop with the NAB, given Congress is again considering a terrestrial radio performance royalty bill that could cost the NAB members multiple millions a year in new costs.
It’s difficult to believe the Internet simulcast royalty discussions took place with everyone agreeing to ignore the very large elephant in the room. Time will tell, I guess, but I wouldn’t be terribly surprised to see the NAB being resigned to a terrestrial radio royalty built along the same rate framework as the simulcast settlement.
Fred Wilhelms – p2pnet
[If the corporate music industry had any ethics, Wilhelms would be its 'ethicist-in-chief,' wrote CounterPunch's Dave Marsh. Wilhelms is an entertainment attorney based in Nashville, Tennessee. You can contact him at fred.wilhelms @ gmail dot com. ]
February , 2009
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February 24th, 2009 at 8:18 am
“This means that the recording artists heard on NAB simulcasts will be entitled to 45% of the royalty revenue.”
This is a joke? Label contracts insure that all money goes to and through the labels. There accounting magic does their tricks and artists get little or nothing.
February 24th, 2009 at 10:04 am
This is not a joke.
Under Section 114 of the Copyright Act, payment of the statutory Internet performance royalty goes through SoundExchange (as the only authorized collective) and it always has. If the webcaster and a label make a direct (non-statutory) license deal, the payment goes directly to the label. (More on this in a note to come.) As the settlement with the NAB will be formally made part of the CRB rate structure, it will be treated as a statutory payment, and thereby go to SoundExchange and not the label.
Fred
February 24th, 2009 at 2:54 pm
Says SoundExchange on their web page:
“SoundExchange retains, on a confidential basis, the artist’s address, contact person, designated payee(s) and royalty earnings history and balances.”
on a confidential basis…royalty earnings history
Just like all performance rights organizations, record companies, publishers, etc.
ll money stuff is confidential.
That means no audits for the benefit of artists and no comparisons between artist. Very nice for the industry side.