BMI agrees to interim music fee reduction


Avoiding the need for a federal rate court to impose an interim music licensing fee schedule for radio stations until a final decision is made by the court, BMI and the Radio Music License Committee (RMLC) have now agreed on interim rates. The rates taking effect August 1st are even lower than the temporary rate which took effect January 1st.

“The Radio Music License Committee and BMI have reached an interim fee agreement in the radio industry’s rate making proceeding which began earlier this year.  The interim fee agreement takes effect August 1, 2010, and calls for an industry fee reduction from $217 million to $192 million.  (This follows BMI’s voluntarily agreeing to provisionally lower fees paid by the industry from $233 million to $217 million as of January 1, 2010),” said a joint statement.

“The parties agreed to these terms in order to expedite court determination of an appropriate final fee retroactive to January 1, 2010.  The agreement was reached by the parties without prejudice as to final fee consideration,” the statement added.

ASCAP had agreed to an interim fee schedule reduced from 2009 fees by 7% before the RMLC reached any sort of temporary deal with BMI. ASCAP, however, said it will seek a rate increase, rather than a decrease, from the rate court. BMI has not publicly stated what position in will take at the rate court. The RMLC, of course, wants fees to be cut by both music license organizations in light of financial pressures on the radio industry.

RBR-TVBR observation: Just think how much more complicated and contentious these music license negotiations would become if radio stations also had to pay a performance royalty to record labels and artists, in addition to the current payments to composers and publishers.