8-28-2012
Judge Louis Stanton, of the Federal District Court for the Southern District of New York, has approved a settlement that ends two years of litigation between the Radio Music License Committee and Broadcast Music, concerning the fees payable by the U.S. commercial radio industry to publicly perform the more than 7.5 million plus musical works in the BMI repertoire through 2016. The RMLC represents the vast majority of the nation?s radio stations.
Christian said, ?This is a gratifying result for the radio industry. The new BMI license reflects the reality of our industry?s economy and puts the industry back on a sound footing insofar as its licensing relationship with BMI is concerned. We appreciate the good will which BMI has demonstrated in working with our industry to get this resolution.?
The new BMI license covers the period January 1, 2010 through December 31, 2016 and includes the following: :
? A $70.5 million industry fee credit against 2010-2011 industry payments that is immediately available to the industry (this, in addition to the industry?s retention of $40 million in fee reductions that had been voluntarily agreed to by BMI at the interim fee stage of litigation in calendar year 2010);
? A 1.7 percent of gross revenue fee structure for stations on the blanket music license format, less a standard deduction of 12 percent for revenue derived from terrestrial/analog and HD multicasting broadcasts and a 25 percent standard deduction for revenue attributable to new media uses;
? Retention of the program-period license that benefits many ?news-talk? format stations, with a base fee of 0.2958 percent of gross revenue, less the same standard deductions; and
? Expanded rights coverage to accommodate the industry?s developing new media platforms related to Internet websites, smart phones, and other wireless devices.
The impact of this settlement was reflected in BMI?s June 2012 billing statements that reflected substantial fee decreases. For many stations, the resulting credit balance will carry through to the end of 2012 before it is exhausted. New BMI license forms will be made available to the industry shortly.
The radio industry had faced a serious challenge in terms of restoring reasonable license fee levels during difficult economic times. License fees had ballooned to some 3 percent of industry revenues for both BMI and ASCAP in the post-2008 environment. The settlement approved by the court today effectively rolls back annual industry fees payable to BMI by more than $80 million for 2012 (as against where they stood at the end of the prior license in 2009) and provides for a return to a revenue-based fee structure at a level of 1.7 percent of gross revenue. In addition, the new agreement covers (at the same 1.7 percent rate) the range of new media platforms in which the radio industry is increasingly engaged.
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