AFTRA, AFL, SoundExchange react to SiriusXM's direct licensing plans

Friday, October 28, 2011 - 11:30am

Buzz surrounding SiriusXM's direct licensing efforts has heated up lately, with new statements from artist labor groups and SoundExchange.

In early August news broke that SiriusXM was seeking to license the sound recordings it plays directly from the copyright owners (record labels). Direct licenses would not only cut SoundExchange out, but copyright owners would not have the same legal obligation to share the royalty revenue with performers that's required under the "statutory" license created by the DMCA (RAIN coverage here).


Thus, SiriusXM could reduce the fees they pay for music and the copyright owners, no longer obligated to share with performers, could keep more.

Two labor groups -- the American Federation of Television and Radio Artists (AFTRA) and the American Federation of Musicians (AFL) -- have come out against the move, calling it "blatantly anti-artist." SiriusXM is trying to "lower the rates for music," the groups state (here). The Recording Academy's president/CEO Neil Portnow also sent a letter to members encouraging independent labels not to directly license with SiriusXM.


SoundExchange also posted a message to its website. The non-profit royalty collection agency points out that Music Reports Inc. (MRI) -- the company SiriusXM is using to try to obtain direct licensing deals -- aims to obtain licenses "at the lowest possible cost." SoundExchange openly pushes in the other direction, the post states (here).

SiriusXM currently pays 7.5% of its revenues to SoundExchange for satellite radio performance royalties (it pays additional, different royalties for its Internet radio broadcasts, more here). In 2012 the rate increases to 8% of revenues. (By comparison, pureplay webcasters like Pandora pay the greater of 25% of total revenues or, in 2011, $0.00102 per listener, per song; more here). Such rates are set by the Copyright Royalty Board.

Internet radio payments power global growth in performance royalties

Tuesday, October 25, 2011 - 11:40am

Digital Music News last week reported that global performance royalties grew 9.1% (up $130 million) in 2010, to $1.6 billion, according to statistics from Music & Copyright. The biggest contributor of performance royalties was SoundExchange, which collects and administers royalties on sound recordings from Internet radio, cable, and satellite radio.SoundExchange

Last year SoundExchange distributed almost $250 million to copyright owners (record labels) and performers, up from just over $155 million the previous year. 2011 should be even better, as SoundExchange collected 94% more in royalties in the first half of 2011 compared to the first half of last year.

Read coverage from Digital Music News here.

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