In a Press Release issued on November 1, the Radio Music License Committee announced the results of its arbitration with SESAC. Despite the arbitrators’ decision that rates for commercial radio broadcasters are going up modestly, RMLC declared the decision a win. How can an increase in royalties be a win? Let’s provide some background on this decision and why the radio industry may breathe a sigh of relief.
First, it is important to set the background for the decision. As we wrote here, in 2015, RMLC and SESAC settled an antitrust lawsuit brought by RMLC, agreeing that rates for the public performance by commercial radio broadcasters of the catalog of SESAC music would be set by binding arbitration. Every four years, a proceeding is held to set the royalties to be paid by a broadcaster for music used in its over-the-air programming and on internet streams of that signal.
The royalty currently paid by commercial radio stations was set by a settlement between RMLC and SESAC before arbitration in 2020 (see our article here). That agreement, under which music radio stations have been paying .2557% of revenue, expired at the end of 2022. As RMLC and SESAC could not mutually agree to new royalties, the recent arbitration was held to set royalties for the period from January 1, 2023 through December 31, 2026. The decision announced on Friday set those royalties at .2824% of revenue. Why is this increase from .2557% to .2824% considered a win?Continue Reading RMLC Announces Arbitration Decision on SESAC Royalties for Commercial Radio Stations for 2023-2026