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Music Royalty To Rise 44%

T

TheBigA

Get ready to pay more for music via digital sites. The Copyright Royalty Board has approved a 44% rate hike (from 10% to 15% of revenue) for music publishers. That doesn't include royalties for labels, artists, and musicians. Here's more from Billboard:

https://www.msn.com/en-us/music/new...shers-will-digital-services-appeal/ar-BBTdiUJ

The digital music services have 30 days to appeal. The article says Apple has already announced it will not appeal. But I really can't understand how any of these companies can afford to pay this kind of royalty. It seems completely outrageous to me. Especially since the Music Modernization Act not requires this same royalty to apply to all music, regarding of when it was created. Clearly music streaming sites will have to pass this increase to consumers.
 
The publishers seem intent on killing their own golden goose. Why do they seemingly exert so much influence on the CRB, which you'd think should be an impartial regulatory body? If a tipping point is reached and most digital music services can't find a viable business model and shut down, will consumers really go back to buying CDs or other physical recordings?
 
CTListener said:
The publishers seem intent on killing their own golden goose. Why do they seemingly exert so much influence on the CRB, which you'd think should be an impartial regulatory body? If a tipping point is reached and most digital music services can't find a viable business model and shut down, will consumers really go back to buying CDs or other physical recordings?
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For a point of comparison, publishers get about 2% of radio revenues. Now they'll get 15% of digital. But labels and artists are still making a lot more, which was what pushed the CRB to approve this hike. What this will do is create another black market for music, similar to when Napster started. People love free music.
 
https://www.cnet.com/news/spotify-explicity-bans-ad-blockers-and-will-kick-off-users-that-have-them/

Now theres a report of Spotify removing ad blockers

Spotify wants you to stream music, but only if you pay for it with either your money or your time.

The service is updating its terms of service, effective March 1, to make it clear that the use of ad-blockers and similar services that prevent ads from playing is not allowed. And it can terminate your account without warning if you use them.

"We've updated our user guidelines, making it clear that all types of ad blockers, bots, and fraudulent streaming activities are not permitted," Spotify said in an email sent Thursday.

This shouldn't be confused with the "Active Listening" feature Spotify has been testing in some territories since last August, which lets listeners choose to skip some ads if they don't want to listen to them.
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This is a factor spotify is doing to respond to the music royalties issue.
 
https://www.billboard.com/articles/business/8497791/record-labels-siriusxm-problem-pandora

And now Record Labels and Sirius will have to confront how royalties issues will play out though in the next deal negotiations.

The satellite giant's purchase of Pandora could give it leverage.
SiriusXM's $3.5 billion purchase of Pandora, finalized Feb. 1, will create a digital-radio behemoth with customized radio playlists, a contract with Howard Stern and an estimated 100 million listeners who tune in from cars, smartphones and laptops alike. And while some music executives are excited about the potential promotional possibilities, others worry about how this new company might use its considerable leverage to push for better terms.

SiriusXM has a reputation as a tough negotiator: It was the first digital radio company to not pay for the use of pre-1972 sound recordings, and it has consistently opposed labels' attempts to raise its royalty rates for recordings, arguing that AM-FM pays nothing to use them. It fought the Music Modernization Act until labels agreed to lock in its current 15.5 percent-of-revenue royalty rate until 2027. "SiriusXM is a company that we still have issues with," says a major-label source.
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CTListener said:
SiriusXM will eventually cave because it cannot survive without music.
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I love the second paragraph in that article. Sirius was the first digital company not to pay pre-1972 royalties.

Yes that's true, and as a result, they LOST a suit brought against them by The Turtles for $90 billion.

So much for being tough negotiators.

Also, their stand on the Music Modernization Act cost them friends in many parts of the music industry. That was not a victory.

And that last quote is very true. The music industry gave up on Pandora a while ago. Their darling is Spotify.
 
https://www.broadcastlawblog.com/20...-and-statutory-licenses-create-a-controversy/

Here is an update

In the last few weeks, the press has been buzzing with speculation that the Department of Justice is moving toward suggesting changes in the antitrust consent decrees that govern the operations of ASCAP and BMI. Those consent decrees, which have been in place since the 1940s, among other things require that these Performing Rights Organizations treat all songwriters alike in distributions based on how often their songs are played, and that they treat all services alike with users that provide the same kind of service all paying the same rate structure. Rates are also reviewed by a court with oversight over the decrees when the PROs and music services cannot come to a voluntary agreement to arrive at reasonable rates. The decrees have also been read to mean that songwriters, once part of the ASCAP or BMI collective, cannot withdraw with respect to certain services and negotiate with those services themselves while still remaining part of the collective with respect to other music users (see, e.g., our articles here and here about the desires of certain publishing companies to withdraw from these PROs to negotiate directly with certain digital services while still remaining in these PROs for licensing broadcasting and retail music users).

With this talk of reform of the consent decrees, Congress, particularly the Senate Judiciary Committee under the leadership of Senator Lindsey Graham, has reportedly stepped in, telling DOJ not to move to change the consent decrees without giving Congress the chance to intervene and devise a replacement system. In fact, under the recently passed Music Modernization Act, notice to Congress is required before the DOJ acts. Already, both the PROs and user’s groups are staking out sides. What are they asking for?
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RadioPatrol said:
Here is an update
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Actually, that's a completely different issue. Although you're correct that it deals with songwriters.

But there was an update today that specifically deals with this 44% royalty increase, and it's that Amazon, Spotify, and others have appealed this new rate:

https://variety.com/2019/music/news...erturn-royalty-increase-exclusive-1203157697/

A joint statement from the first three of those companies reads: “The Copyright Royalty Board (CRB), in a split decision, recently issued the U.S. mechanical statutory rates in a manner that raises serious procedural and substantive concerns. If left to stand, the CRB’s decision harms both music licensees and copyright owners. Accordingly, we are asking the U.S. Court of Appeals for the D.C. Circuit to review the decision.”
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And in response, the songwriters have gone bonkers, accusing the digital streamers of declaring war on songwriters.
 
TheBigA said:
Actually, that's a completely different issue. Although you're correct that it deals with songwriters.

But there was an update today that specifically deals with this 44% royalty increase, and it's that Amazon, Spotify, and others have appealed this new rate:

https://variety.com/2019/music/news...erturn-royalty-increase-exclusive-1203157697/



And in response, the songwriters have gone bonkers, accusing the digital streamers of declaring war on songwriters.
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look like it's time for Streaming to die as a platform for free music and we go back to buying tapes, cds, and records and recording music on the radio like we used to pre-Napster.
 
Will_H_69_9 said:
look like it's time for Streaming to die as a platform for free music and we go back to buying tapes, cds, and records and recording music on the radio like we used to pre-Napster.
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If so, that will be a rare -- maybe unprecedented -- case of putting the genie back in the bottle. Of course, only CDs would come back, as they were the dominant physical recording medium before streaming.
 
landtuna said:
d
You mean the same genie's that planted all those OTA antennas on residential roofs lately?
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I don't see an increase in OTA TV viewing if rooftop antennas are an indication. What the statistics do show is a decrease in cable subscribers and an increase in the use of OTT services. So the cable company does not sell "cable" any longer... they sell Internet. For them, perhaps better... the end user pays the subscription fees and they don't have to worry as much about licensing each and every channel, other than "must carry" ones.
 
DavidEduardo said:


I don't see an increase in OTA TV viewing if rooftop antennas are an indication. What the statistics do show is a decrease in cable subscribers and an increase in the use of OTT services. So the cable company does not sell "cable" any longer... they sell Internet. For them, perhaps better... the end user pays the subscription fees and they don't have to worry as much about licensing each and every channel, other than "must carry" ones.
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You've described the way my TV viewing has evolved to a T, except for one thing -- I don't pay a penny to the cable franchise owner here, which is Cox. I get my internet via Frontier, which inherited AT&T's old phone/internet business when AT&T pulled out of Connecticut. About $40 a month for internet only, then $40 a month for YouTube TV, $5 a month for ESPN+ and $120 a YEAR for MLB TV (baseball). My phone is a cheap basic dumb cellphone that I use only as a phone, and very rarely at that, topping up with $10 every month and a half. I see everything I want to see -- which is mostly sports -- and don't have to deal with any bloated cable packages. And as I said, Cox gets nada from me!
 
CTListener said:
You've described the way my TV viewing has evolved to a T, except for one thing -- I don't pay a penny to the cable franchise owner here, which is Cox. I get my internet via Frontier, which inherited AT&T's old phone/internet business when AT&T pulled out of Connecticut. About $40 a month for internet only, then $40 a month for YouTube TV, $5 a month for ESPN+ and $120 a YEAR for MLB TV (baseball). My phone is a cheap basic dumb cellphone that I use only as a phone, and very rarely at that, topping up with $10 every month and a half. I see everything I want to see -- which is mostly sports -- and don't have to deal with any bloated cable packages. And as I said, Cox gets nada from me!
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We are on the same ISP... I have Frontier FiOS service and actually decided between several homes based on its availability. I have the 500/500 service, and I have lost it only one time for a few hours in just under 4 years.

I tried to put indoor HDTV antennas to use, but my aluminum-clad double insulation makes that impossible. And the HOA rules on antenna placement outdoors would have cost so much in extra wiring costs that I kept basic cable for the local channels... the rest is Prime, Netflix and Hulu and whole family is happy.

Frontier has a basic in this area (California Low Desert) that does not force ESPN and the expensive sports channels on me, so it is a good buy.

I think that more consumers will make menu choices in the future, and the statistics surely indicate that. OTA remains an option for those who want local channels and can easily install an antenna, but many will just jump to OTT services and buy several to fill their needs, just as you bought the MLB package.
 
CTListener said:
I was going to ask whether you planned to turn your clocks ahead 30 years later tonight, but then I remembered ... Arizona.
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Yuppers. We don't need no stinkin' daylight savings time. We even got our own time setting in Windoze.
 
landtuna said:
Yuppers. We don't need no stinkin' daylight savings time. We even got our own time setting in Windoze.
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Obviously, states like AZ and FL that are farther south don't need DST.

Having lived where sunrise and sunset only varied by a few minutes all year long, I appreciate the consistency of having a single zone permanently.
 
DavidEduardo said:


Obviously, states like AZ and FL that are farther south don't need DST.

Having lived where sunrise and sunset only varied by a few minutes all year long, I appreciate the consistency of having a single zone permanently.
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Actually, in those few years when we did subscribe to DST I did find positives.

Those of us in school could come home, do our homework, eat dinner and still have an hour or more to play outside before dark. Parents generally didn't like it though as it was tough to put youngsters to bed while still light outside. And the drive-in movie industry didn't like it for obvious reasons (even though this industry is totally dead today). I liked coming home to enough light to be able to mow the lawn and do weekday chores with light outside but most people here whined about how hot it was and wanted the darkness quicker - even though it made no difference in the heat.

When I lived back east I hated going to work in the dark and coming home in the dark as well. It would have been nice to have some daylight at one end of the day - and it would have benefited the kids who had to go to school in morning darkness (and probably saved a few lives as well).

As a long time suffering member of the IT industry though I hated that AZ didn't observe DST. It meant a ton of work two times per year adjusting computer offset times to neighboring states and the failure of TV listings to be out of sync for a month each year.
 
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