LONDON (VIP NEWS) — In a settlement announced between radio stations in US and BMI, the performance right organization will receive performance royalty compensation of 1.7% of radio revenue less certain standard deductions going forward through 2016.
The settlement, which must be approved by federal court, also includes a $70.5 million credit adjustment for payments made during 2010 and 2011, which means that many stations will have a BMI credit balance available for the remainder of this year, according to the announcement.
In calculating royalty payments going forward, terrestrial/analog radio will get to deduct 12% of revenue, while HD multicasting broadcast will get to deduct 25% from revenue attributable to new media use.
The settlement — made with the Radio Music License Committee which represents the vast majority of the nation's stations — also calls for retention of the program-period license, less the same deductions above, that benefits many talk-format stations; and provides expanded rights coverage to accommodate the industry's new media platforms.
"This agreement allows us to move forward without the cost and uncertain outcome of further litigation," BMI senior VP of licensing Michael Steinberg said in a statement. "While fees will be lower than the prior final agreement, the return to a percentage-of-revenue license will allow us to grow BMI revenues as the radio industry rebounds." –According to Billboard