The Radio Music License Committee (RMLC), which negotiates music licensing fees for most of the radio industry with ASCAP and BMI announced Friday that it has reached agreement with ASCAP on temporary fees to be paid by radio operators, beginning January 1, 2010.
The temporary schedule will reflect a provisional fee discount of 7% from 2009 station fee levels. RMLC said the fee reduction should be reflected in the January 2010 ASCAP monthly billing.
While the temporary rates beginning next month are down from current levels, ASCAP doesn’t want that to be the permanent situation. “ASCAP’s near term objective with radio licensing is to ensure a continuing flow of interim funds for our members while we strive for fair long term fees from the Court. Fair fees will reflect the increased and expanded use of music by the radio industry in the digital and wireless world for streaming, HD multicasting and mobile applications. ASCAP fully anticipates that the final fees set by the Court will be in excess of those fees the radio industry currently pays,” ASCAP said in a statement to RBR-TVBR Friday.
Absent a negotiated settlement between the RMLC and ASCAP on long-term fees, the US District Court in New York will make a determination of interim and permanent fees for the new contract period. RMLC speculated that the rate court process may consume one or more years. To bridge the gap prior to determination of a final fee order, which will be retroactive to January 1, 2010, the RMLC and ASCAP have agreed to the provisional interim fees that will remain in effect until the rate court determines interim fees, which RMLC expects to occur during Q2 of 2010.
The RMLC conducted voluntary negotiations earlier in the year with both ASCAP and BMI. The separate discussions reached impasse, which RMLC said left the parties no alternative but to petition for the court to set the rates.
Friday’s announcement dealt only with ASCAP. RMLC said it will soon announce that it is pursuing a similar course of action with respect to BMI, whose licenses also expire at the end of this year.
“It is unfortunate that the gap in our respective positions was so vast that it made it virtually impossible to reach a voluntary agreement as to new licenses commencing in 2010. That being said, the rate court exists for this very purpose and we remain confident that the RMLC can achieve a further rate reduction during the interim fee phase of the proceedings,” said RMLC Chairman Ed Christian, CEO of Saga Communications.