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RAIN 8/12: Sirius XM reportedly seeking direct licensing to bypass SoundExchange

Posted on: 08/12/2011


Sirius XM is attempting to reduce the fees it pays for the use of copyright sound recordings by forging deals directly with record labels, and thus bypassing the statutory terms and SoundExchange.

The satellite radio broadcaster is reportedly offering record labels a royalty rate of 7% of gross revenues, down from its current rate of 7.5%. Sirius XM’s rates will grow to 8% in 2012. The rates for 2013-2018 have not yet been decided — the Copyright Royalty Board begins the arbitration process next year.

These percentage-of-revenue figures apply to Sirius XM’s satellite transmissions. The company pays different royalties for Internet streams. Most webcasters, like Pandora, pay royalties on either a per-song, per-listener basis or a percentage of revenue (ranging from 7% to 25% depending on revenue) — whichever is greater (find much more coverage on Internet radio royalties here).

Sirius XM also hopes to expand its licenses to allow for the new functionality of its 2.0 service (including recording and local caching of content).

SoundExchange takes an overhead from the money it collects, then splits the remainder 50-50 between copyright holders (music labels) and performers. If Sirius XM instead pays the labels directly for licenses, it will be up to the latter to deal out payments to artists.

Billboard has more coverage on this story here.

In July, Universal Music Group announced it would license directly with CBS Interactive’s Last.fm (RAIN coverage here). And in March, on-demand music subscription service Rhapsody sought to pay “pureplay” webcaster royalty rates (RAIN coverage here).


Music subscription store eMusic has launched a new Internet radio service. Called eMusic Radio, the beta service is available only to U.S. subscribers and features a stream of songs hand-picked by the service’s staff.

There are a number of streams, each focusing on a different genre or style (post-punk, guilty pleasures, etc.)

eMusic subscribers can listen to the stations for 10 hours per month and can only skip six songs per hour due to licensing agreements. Billboard has more coverage here.


Internet radio and Grace Digital have gone vintage with the new Victoria Nostalgic Internet Radio.

The tabletop Wi-Fi radio streams Pandora, Live365, Rhapsody, CBS Radio, Sirius XM and DAR.FM, but sports a retro walnut casing reminiscent of the 1940s.

Unlike most (ok, probably all) 1940s radios, this one lets you control playback via a free iPhone app. Chip Chick has more coverage here.

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