Why Did BMI Go To Court To Set RMLC Rates?


RMLCThe Radio Music License Committee (RMLC) has started the new year with a new battle on its hands.

BMI is to thank.

The songwriters rights and royalties organization on Tuesday (1/3) filed an action in Federal Rate Court to set interim fees for radio stations represented by the RMLC while the two parties negotiate the terms of a new five-year deal beginning this year.

At issue is an interim rate that both the RMLC and BMI can agree on.

According to BMI, the RMLC has proposed an interim rate well below BMI’s previous deal, “the effect of which would have a significant impact on the royalties BMI pays to its songwriters, composers and music publishers,” the rights organization claims.

BMI further argues that the RMLC “has justified its proposed rate based upon incomplete and incorrect information regarding BMI’s radio performances. BMI disagrees fundamentally with the RMLC’s proposal and, consistent with past practices, is asking the court to maintain its most recent rate while new terms are negotiated.”

The terms of the previous final agreement between BMI and RMLC stations included a rate of 1.7% of each licensee’s gross revenue and a corresponding reduced rate applicable to talk format stations that have a Per Program License.

RMLC wants the rate reduced to 1.4% of each licensee’s gross revenue. “The RMLC can point to no changed circumstances that warrant a reduction in BMI’s interim or final rate,” BMI argues in a filing made Jan. 3 with U.S. District Court for the Southern District of New York. “Indeed, since entering into the last license, RMLC station music use, particularly via new media, has exploded, warranting an increase, not decrease in rates. Moreover, the RMLC’s interim rate proposal is inconsistent with the RMLC’s recently announced final license agreement with the American Society of Composers, Authors & Publishers (ASCAP), which increased the rates payable to ASCAP as of Jan. 1, 2017.”

Rates were increased from 1.7% of each licensee’s gross revenue, BMI points out. The new terms of ASCAP’s deal with RMLC have not been disclosed.

Mike Steinberg, BMI’s SVP/Licensing, said, “We attempted to negotiate in good faith with the RMLC for many months, and just before the end of the year, the RMLC presented an interim rate that significantly undervalues the work of BMI’s songwriters. Given the unmatched caliber of BMI’s repertoire, our superior market share on radio, and the ever-increasing value that BMI music brings to the radio industry across all its platforms, we believe the RMLC’s proposal falls well short of what is in the best interests of our affiliates.”

BMI is represented by a group of attorneys from Milbank, Tweed, Hadley & McCloy LLP.

RMLC did not immediately respond to a request for comment from RBR + TVBR.