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BMI and RMLC Settle Their Dispute Over Radio Royalties

BMI and the RMLC have announced a settlement to their two-year-old rate court litigation dispute, and while terms of the deal are undisclosed, BMI says the "new license carries a rate that reflects the strength of BMI's repertoire and its share of radio spins, which is higher than any other performing rights organization."

The settlement, which is retroactive back to 2017, still needs to be approved by BMI Federal rate court Judge Louis Stanton of the U.S. Southern District of New York.

"We're pleased to reach an agreement with the RMLC that reflects a much more appropriate value for our affiliates' music," BMI president and CEO Mike O'Neill said in a statement. "While litigation is sometimes a necessary step, our preference is always to work out an amicable solution with our licensing partners while continually keeping the best interests of our songwriters top of mind. BMI looks forward to working with the RMLC to improve transparency in the marketplace and enhance the flow of information between our two organizations."   

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The rate dispute began when the RMLC (Radio Music Licensing Committee), which represents about 10,000 radio stations in rate negotiations with PROs, tried to impose a market share regime based on radio play on the four U.S. performance rights organizations, BMI (Broadcast Music Inc.), ASCAP (The American Society of Composers, Authors, and Publishers), SESAC (Society of European Stage Authors and Composers), and Global Music Rights (GMR); and that regime placed BMI's market share, according to Billboard's assessment, at a lower share and rate than ASCAP.

When BMI first filed suit in January 2017 to have the rate dispute settled by the BMI rate court, Billboard's calculations estimated that ASCAP had been assigned a 50% market share and received a rate of 1.75% of radio revenue; and BMI had been assigned a 40% market share and received a rate of 1.4% of radio revenue.

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RMLC chair Ed Atsinger — CEO of Salem Communications which owns about 100 radio stations — also acknowledged that the committee is happy to have reached an amicable conclusion. "The radio industry believes strongly that songwriters should be compensated fairly, and with BMI's support, we hope that this deal will assist others in the music licensing community in determining fair rates for everyone on both sides," Atsinger said in a statement.

ASCAP also said the settlement is good for writers. "We are supportive of songwriters getting fair market rates, no matter what PRO represents them, and we are happy that the parties were able to settle their differences," ASCAP CEO Elizabeth Matthews said in a statement.

In another aspect of the settlement, BMI said that the RMLC has agreed to a one-time payment to BMI for litigation fees.  The new agreement also clarifies and preserves the platforms that are covered by the scope of the license and associated revenue, including over-the-air broadcasts, as well as the stations' simulcast streaming, podcasts and HD radio.

In other words, for radio stations that engage in all these platforms, the so-far undisclosed BMI rate will apply to overall combined revenue derived from each platforms under each broadcast owner’s umbrella.