soundexchnage royalties

In recent weeks, SoundExchange has begun to send letters to broadcasters who are streaming their signals on the Internet without paying their SoundExchange royalties.  Despite all of the publicity about Internet radio royalties and the controversy about the rates for those royalties, there still seem to be webcasters unfamiliar with their obligations to SoundExchange.  As we have written many times, SoundExchange collects royalties for the public performance of the "sound recording", a song as recorded by a particular artist.  Those royalties, which are charged only to digital media companies like Internet radio, satellite radio and digital cable radio, are paid half to the copyright holder in the recording (usually the record company for most popular songs) and half to the performers on the recording.  These royalties are paid in addition to the royalties paid to ASCAP, BMI and SESAC for the public performance of the musical work – the underlying musical composition, the words and music of a song – money that is paid to the composers of that musical work.  So just paying ASCAP, BMI and SESAC is insufficient to cover your streaming operations when music is being used. 

While these royalties have been law since 1998, and have been set by decisions first by a CARP (Copyright Arbitration Royalty Panel) in 2003, and then by the Copyright Royalty Board in 2007, it seems like some companies still have not gotten the message about the obligations to pay these fees.  Thus, in the last few weeks, SoundExchange has been sending out letters to companies that have not been paying.  The letter are not particularly threatening – instead pointing out the obligations that companies have to pay the royalties, and asking if the webcaster may be paying under some corporate name that is not readily apparent from the website.  The letter also points the webcaster to the SoundExchange website for more information.  Finally, it notes that SoundExchange represents the copyright holders for collections purposes, and notes that nothing in the polite letter waives any rights that those holders have to pursue actions for failure to pay the royalties – in other words to sue for Copyright infringement.   So, gently, webcasters are reminded to pay their royalties or risk being sued for copyright infringement, with potential large penalties for playing music without the necessary licenses.


Continue Reading SoundExchange Sending Reminders to Broadcasters Who Are Not Paying Royalties for Streaming Music Sound Recordings

On August 20, David Oxenford attended the Texas Association of Broadcasters Annual Convention in Austin Texas.  At the Convention, Dave participated with two other Washington attorneys in a session updating broadcasters on legal issues that could affect their operations.  He addressed topics including the proposed Broadcast Performance royalty, the proposed increase in power of HD radio operations

We reported on the settlement under the Webcaster Settlement Act between the NAB and SoundExchange on Internet Radio Royalties. As provided in the Webcaster Settlement Act, that settlement has now been published in the Federal Register, and thus it is available for broadcasters who are streaming their signal on the Internet, or who are streaming other programming on the Internet, to claim coverage under that settlement. To do so, broadcasters who are already streaming must file a notice of Intent to Rely on this settlement, available here, with SoundExchange, by April 2, 2009 – thirty days after the Federal Register publication occurred. Broadcasters who are not now streaming, but who start in the future, must file the election notice within 30 days of the start of their streaming, or they will be bound by the rates established by the Copyright Royalty Board in their 2007 decision (see our post here). The publication sets out several other details of the settlement, set forth below.

The rates: The rates, which represent some savings under the CRB rate for the years between 2007 and 2011, are set forth below.  These rates are "per performance", meaning that the rate is paid on a per song, per listener basis.  If you play 10 songs in an hour, and each song is heard by 10 people, you have 100 performances.  There are companies that provide services to track and report on performances.  See our post, here, for details.  There are also limited exceptions to the full "per performance" reporting, summarized below.  The rates under this agreement are as follows:

 

2006 ……………………………….. $0.0008

2007 ……………………………….. 0.0011

2008 ……………………………….. 0.0014

2009 ……………………………….. 0.0015

2010 ……………………………….. 0.0016

2011 ……………………………….. 0.0017

2012 ……………………………….. 0.0020

2013 ……………………………….. 0.0022

2014 ……………………………….. 0.0023

   2015 ……………………………….. 0.0025


Continue Reading Details of the Broadcaster SoundExchange Settlement on Webcasting Royalties