STINGRAY BREAKS ROYALTY “LOGJAM” WITH MAJOR LABELS IN CANADA, LAUNCHES MOBILE NET RADIO

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Issue Date: 
Aug 16 2011 - 11:00am

From Issue:

Montreal-based Stingray Digital today launched its commercial-free, subscription-based streaming music service for mobile phones.

As Toronto’s The Globe and Mail reports, this development “represents the first time a number of music labels have worked together tosimplify an agreement for digital music rights in this country.”

Uncertainty over streaming royalty obligations in Canada has discouraged many webcasters, including the industry-leading U.S.-based Pandora, from operating in the country.

Stingray, however, reportedly convinced labels (working together as Music Canada) and two smaller label groups to agree to a “fifth of a cent per play” ($0.002 CAD) (likely meaning “per performance”) royalty. For comparison, U.S. “pureplay” royalty rates ramp from $0.00102 USD (a little over a tenth of a cent) in 2011 to $0.00140 USD per performance. However, large webcasters will pay 25% of their total annual revenuesinstead, if that figure is larger (see our coverage here).

Graham Henderson is president of the major label trade association Music Canada (which represents Sony Music Canada, Universal Music Canada, Warner Music Canada and EMI Music Canada).

Henderson commented on the deal: “If we’re lucky, we may have broken a logjam here and we may see the introduction of a number of new services into the country, which will only stimulate the market for music in Canada… We’ve got to get a variety of legal services in the marketplace that people are aware of and comfortable with, that will wean them off of doing the wrong thing, which is taking music without compensating artists.”

The new Stingray Digital app brings 45 streaming audio channels to the iPhone, iPad, iPod Touch, and all Android-based mobile devices. Listeners can skip songs and purchase songs downloads from the iTunes store. The service is available to U.S. listeners as well as in Canada. Finally, the programming consists of (presumably) the same channels the company offers via various cable and satellite television services in Canada as Galaxie.

Read more from The Globe and Mail online here.

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