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RAIN NEWS FLASH: NAB settles with SoundExchange on webcast royalties

Posted on: 02/16/2009


SoundExchange and the National Association of Broadcasters (NAB) have reportedly reached an agreement on webcast royalties for commercial broadcasters’ simulcast and Internet-only online streams. The agreement, which applies to 2009-2015, requires broadcasters to pay a “per-performance” fee (a “performance” is one listener hearing one song) of $0.0015 beginning this year. The rate will increase annually to $0.0025 per performance by 2015.

Rates for the 2006-2010 term had already been determined by the Copyright Royalty Board in 2007. The new rates for 2009 and 2010 will save broadcasters around 16% compared to the CRB rates; however, the NAB did agree to roughly 10%/year price increases thereafter.

By agreeing on rates through 2015, NAB members will not have to spend the hundreds of thousands of dollars in legal fees that would be required to participate in a Copyright Royalty Board rate determination proceeding for the 2011-2015 period.

The NAB has apparently also reached agreements with record labels to waive certain statutory format restrictions — allowing, for example, their artists to be played more often than the restrictions contained in the DMCA. Those restrictions make it currently illegal to stream such programming features as “Triple-Play Thursdays” or “Album Sides Weekend.”

As of press time, we’re still awaiting word of settlements between SoundExchange and various other webcaster groups, like the Small Commercial Webcasters group, religious broadcasters, and various DiMA members (e.g., Yahoo!, MTV, and Pandora). Read more details here.

Still to come, of course, later this year, is the battle in Congress to see whether broadcasters will be required to pay owners of sound recording copyrights for their use in over-the-air broadcasts.

Check back later today or tomorrow for more news on webcast royalty settlements.

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