Music interests, CPB reach pact on web fees
CPB will pay $1.85 million in royalty fees for the digital music streams operated by public radio stations under a long-anticipated agreement with SoundExchange, the royalty collection agent for recording labels and sound artists.
The agreement, concluded nearly two years after negotiations began, covers royalties for music webcasts for 2005 through 2010. The rate, based in part on the size of pubradio’s online audience, will increase in step with aggregate tuning hours and the number of participating pubcasters.
This supersedes a 2007 decision by the federal Copyright Royalty Board that would have imposed SoundExchange’s commercial-radio rates on pubradio web streams with the largest audiences. Pubcasters challenged the CRB rate structure because it didn’t acknowledge public radio’s nonprofit status or public-service mission.
The royalty payment covers web streams of an estimated 450 pubradio stations, including those that qualify for CPB funding and some that do not. Member stations of NPR and the National Federation of Community Broadcasters are covered. American Public Media, Public Radio International, the Public Radio Exchange, and NPR and its online music service also are covered.
Besides paying the lump-sum royalty payment, CPB will foot the bill for setting up an independent reporting system that will sync data on pieces of music streamed over the Web with data on audience, according to Bruce Theriault, senior v.p. for radio. CPB requested proposals for an outside entity to manage the reporting system, and Theriault expects CPB to choose the vendor this month. “We have to start reporting within the next quarter, so we want to establish this as soon as possible,” he said.
Roger LaMay, manager of WXPN in Philadelphia, described the agreement as “artist-friendly” because it covers performers whether they are members of SoundExchange or not. Once the reporting system is set up, independent artists whose music gets pubradio airplay will receive royalty payments.
LaMay expressed disappointment that the deal, completed as its fourth year begins, will expire next year.
The five-year term was set out in the 2007 CRB decision, according to Mike Riksen, NPR’s v.p. for policy and representation. Pubcasters and SoundExchange could probably have extended it but didn’t. “Given the ground-breaking elements of the agreement, we need to see how they play out and work before thinking about entering into a second one,” Riksen said.
The pact’s overall framework is “very solid” and a likely basis for future contracts, Riksen said. “It acknowledges the significant and important overall objective we had coming in—the treatment of public radio’s web streams as a single entity . . . . It reinforces the public-service mission that we have, and distances us from revenue and transactional-based commercial models that were proposed inappropriately by the CRB.”
SoundExchange news release, Jan. 15, 2009
SoundExchange and the Corporation for Public Broadcasting Set New Terms for Rates and Reporting through 2010
WASHINGTON, D.C. –SoundExchange (SX) and the Corporation for Public Broadcasting (CPB) announced today a comprehensive agreement on Internet performance royalties for non-commercial educational public radio entities to be paid to sound recording artists and copyright owners.
The agreement establishes the amount of royalties that will be paid by CPB on behalf of the public radio system for streaming sound recordings on a variety of public radio websites during the period January 1, 2005 through December 31, 2010. The agreement was reached under the authority of the Webcaster Settlement Act of 2008 (H.R. 7080) and will cover approximately 450 public radio webcasters including CPB supported stations, National Public Radio, NPR members, National Federation of Community Broadcasters members, American Public Media, the Public Radio Exchange, and Public Radio International.
Under the agreement, public radio webcasters will be entitled to alternative statutory royalties from those established by the Copyright Royalty Board (CRB) in May, 2007. SoundExchange is to receive a single up-front royalty payment of $1.85 million together with consolidated usage and playlist reporting from CPB on behalf of the entire public radio system. NPR has also agreed, as a condition of the agreement, to withdraw its appeal of the May 2007 CRB royalty rate decision.
Both parties praise the agreement for reinforcing the value of artists’ performances, while recognizing the unique mission of public radio. “We are extremely pleased by this agreement with CPB, and public radio stations. Public radio broadens the landscape of music available to music fans and SoundExchange’s 35,000 artists and 4,000 plus labels look forward to our continued partnership with public radio,” said John Simson, executive director of SoundExchange.
“This important agreement will ensure that the artists heard on public radio station websites will receive compensation and will enable public radio webcasters to continue to meet their public service, non-profit missions,” said Pat Harrison, president and CEO of CPB. “Thank you to our public radio negotiating partners, NPR and the Station Resource Group, for the invaluable contributions they have made during these negotiations.”
Consolidated reporting from CPB will improve the efficiency of the payment process helping to ensure that performers and sound recording copyright owners are accurately paid for the use of their recordings.
Web page posted Feb. 4, 2009
Copyright 2009 by Current LLC
