Stations this week received a letter from SESAC, asking them to renew their next three-year agreement for 5% less than they pay now.
However, by taking the deal, SESAC makes it clear the station is agreeing it will not be part of any negotiations with the Radio Music License Committee to negotiate a rate with SESAC.
The RMLC meanwhile, has responded with its own letter, indicating stations should stay away from the SESAC deal.
Wilkinson Barker Knauer Attorney David Oxenford blogs that the RMLC letter suggests SESAC is trying to divide and conquer the radio industry by signing up numerous stations at a small discount, while the RMLC believes SESAC’s rates are “dramatically” higher than they should be. The RMLC will be looking to reduce those, by about half.
“RMLC’s letter also says that SESAC may be looking to get stations to sign on at a 5% discount so that they can argue in any arbitration proceeding that these agreements represent direct deals negotiated between willing buyers and sellers, and the rates that stations agree to should represent the fair market value of the SESAC catalog,” according to Oxenford.
Stations that want to sign with RMLC must do so by Nov. 20.
He says should evaluate both letters before making a decision; by accepting the SEAC offer, stations may be giving up a larger discount if the RMLC successfully negotiates a better rate with SESAC.
