July 31, 2017
Private US-based licensing organization SESAC has reached a new deal with the Radio Music License Committee (RMLC), which the PRO claims will result in substantially larger rates for its clients that ASCAP’s equivalent agreement.
The RMLC represents more than 10,000 commercial radio stations in the US market, and has been in arbitration with SESAC over royalties since 2015.
That process now has a definitive result: three independent arbitrators have determined the rate SESAC can charge terrestrial radio stations represented by the RMLC for the period between January 1, 2016 and December 31, 2018.
SESAC’s not-for-profit rival ASCAP signed a voluntary deal with the RMLC in December which covered the five-year period from 2017 to the end of 2021 – an agreement which ASCAP said contained a royalty hike on its previous incarnation.
In a note to media issued today, the for-profit SESAC didn’t hold back in expressing its dissatisfaction over ASCAP’s deal.
It said: ‘Based on reports that have appeared in the trade press regarding ASCAP’s recent settlement with the RMLC as well as published estimates of ASCAP’s market share, SESAC believes that the rates reflected in its arbitration award are approximately 50% higher than ASCAP’s — which is the rate the RMLC has been trying to impose on the music industry.
‘SESAC has agreed to use commercial arbitration to resolve license fee disputes with the RMLC, whereas ASCAP remains subject to a Consent Decree with the US Department of Justice. SESAC believes that the Consent Decrees impose restrictions that may prevent rightsholders from realizing the fair market value of their works.’
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