Rich Fiscus
6 Feb 2008 0:10
According to many music label executives, manufacturers of portable music players should be paying them a cut of profits since their sales are predicated on the availability of recorded music. Unfortunately they don't hold themselves to the same standard they'd like to hold companies like Apple to, as they've shown in a proposal to the U.S. Copyright Royalty Board (CRB) which would reduce songwriter royalties for physical sales (in formats like CD) to $0.06 per song, from the current rate of $0.091. Their proposal would also set download rates at a lower level of up to 5.5 cents per Track, while Streaming would compensate songwriters to the tune of 0.58% (less than 1%) of revenue.
The songwriters, represented at CRB negotiations by the National Music Publishers' Association (NMPA), are proposing that royalties for physical sales be increased to 12.5 cents per song (twice the labels' proposed rate), with a rate of 15 cents per song for downloaded songs, under the assumption that downloaded music has lower costs for the labels compared to the distribution of physical media like CDs. Their proposal calls for streaming royalties to be set at 12.5% of revenue, 27.5% of content costs, or less than a penny per play as a flat rate.
The Digital Media Association (DiMA), which represents many of the tech companies involved in the internet music industry, is also involved in the CRB hearings, and have their own proposal. Not surprisingly, it also suggests setting royalties lower than songwriters, or even the labels, are asking. In fact, in the case of streaming royalties they're saying the songwriters have no Right to royalties, and are asking the CRB to make a definitive judgement on the question.
If the CRB sounds familiar, you may be remembering their big announcement last year that they would be accepting a SoundExchange (recording industry) proposal for new internet radio royalties without a single change. This may be a bad sign for songwriters, who are counting on the CRB to actually read and consider three different royalty proposals to determine what's fair.