BMI and the Radio Music License Committee have reached a settlement to resolve three years of litigation over the licensing rates that will be paid by nearly 9000 radio stations to songwriters and publishers – a deal that BMI is calling “a historic rate increase.”
According to court filings, the new deal will see rates paid by radio stations jump from 1.78 percent of revenue under the old agreement to 2.14 percent, then slowly increase to 2.20 percent by the end of the term. The deal is retroactive to January 2022 and will run until January 2029.
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In a statement, BMI president & CEO Mike O’Neill described the settlement agreement as “a historic rate increase” that “ensures BMI’s songwriters will be more fairly compensated for the performance of their music on this incredibly important platform.”
“BMI sought a rate that reflected our market-leading share of the music performed on radio stations across the country, and I’m pleased to say we achieved our largest rate increase ever for the radio industry,” O’Neill said.
In his own statement, RMLC chairman Ed Atsinger said the group was “pleased to have reached an amicable agreement with BMI, which is indicative of how strongly the radio industry values its partnerships with songwriters.”
“We feel that this agreement provides the radio industry with the ability to plan for the long-term while avoiding substantial litigation costs and uncertainties associated with the rate court process,” Atsinger said.
BMI’s new rate deal will apply to 8,895 radio stations, according to court filings, including those that are directly represented by RMLC and others that have agreed to be bound by its blanket license negotiations.
RMLC filed its lawsuit against BMI in June 2022, using a standard legal procedure to ask a federal court in New York to decide what rates its stations should pay. But the lawsuit took the novel step of filing a single rate-setting case against both BMI and ASCAP – the two biggest performance rights organizations (PROs) in the country that collect performance royalties for the vast majority of American musical compositions.
The new tactic, enabled by the Music Modernization Act and its sweeping legal reforms in the music industry, would have, in effect, pitted the two against each other, forcing them to argue over market share and thus what percentage of radio advertising each should be paid.
But BMI and ASCAP both strongly objected to the move, and the combined case was rejected in 2023 by a federal judge, who said RMLC would need to litigate the two cases separately. The group eventually filed a separate rate-setting lawsuit against ASCAP, and litigation continued in both cases until this month.
On Friday, just days before the settlement with BMI was announced and filed in court on Tuesday, RMLC filed a motion in the ASCAP case saying it would voluntarily drop that lawsuit permanently. No settlement agreement was mentioned, and neither group immediately returned a request for comment from Billboard on the status of the ASCAP case.
