US collecting society BMI has welcomed a ruling in the American rate courts, which will increase what the organisation’s members earn when their songs are performed at gigs and concerts across America.
Songwriters and music publishers are due royalties whenever their songs are performed in public, and those royalties are usually managed by the collective management system. So in the US, those are the four collecting societies that represent the performing rights in songs: ASCAP, SESAC, GMR and good old BMI.
How this works differs from country to country, and according to the kind of show, but societies commonly collect a small percentage of a show’s box office. How small a percentage also varies from country to country, but the rate is famously low in the US when compared to Europe.
But now slightly less so. Both ASCAP and BMI are regulated by things called consent decrees which, among other things, allow these rate courts to ultimately set the rates that each group of licensees must pay. And BMI has been busy for years now trying to get the rate court to increase what it receives from concert promoters, up from the previous rate which was set in the late 1990s.
This saw BMI go up against live giants Live Nation and AEG, as well as the North American Concert Promoters Association, before rate court judge Louis L Stanton. The society didn’t get everything it wanted from the licence revamp, but the rate has improved in a decision which, BMI said in a statement yesterday, “ends decades of below-market rates for songwriters, composers and publishers in the live concert industry”.
“As a result”, it went on, “BMI affiliates will receive a rate that is 138% higher than the historical rate. And just as important, judge Stanton ruled that this new rate will be applied to an expanded revenue base, taking into account the way modern promoters monetise concerts. This includes tickets sold directly onto the secondary market, servicing fees received by the promoters and revenues from box suites and VIP packages”.
BMI had also been seeking a share of the live sector’s advertising and brand revenues, and the removal of a 10% discount on the rate currently enjoyed by NACPA members, provided on the basis that the trade group helps facilitate the licensing system. But, nevertheless, BMI definitely leaves the rate court with a considerably better package than before.
Says BMI boss Mike O’Neill: “This is a massive victory for BMI and the songwriters, composers and publishers we represent. It will have a significant and long-term positive impact on the royalties they receive for the live concert category”.
“We are gratified the court agreed with BMI’s position that the music created by songwriters and composers is the backbone of the live concert industry and should be valued accordingly”, he adds. “Today’s decision also underscores BMI’s continued mission to fight on behalf of our affiliates, no matter how long it takes, to ensure they receive fair value for their creative work”.
“While we’re THRILLED with this outcome”, he concludes, “we find it incredibly disappointing that it took millions of dollars and years of litigation to get Live Nation, AEG and NACPA to finally pay songwriters, composers and publishers what they deserve”.