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Mechanical Licensing Collective Reaches A Deal For Initial Funding And First Year Operating Costs

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WASHINGTON D.C. (CelebrityAccess) — The Mechanical Licensing Collective (the MLC) and the Digital Licensee Coordinator, Inc. (the DLC) announced that they have reached an agreement over the funding of the collective.

Under the terms of the deal, the MLC will $33.5 million for start-up costs and an initial annual assessment for 2021 of $28.5 million. All costs will be divided up among the licensees, with the largest services paying a greater share

Established by the Music Modernization Act, the MLC is a nonprofit entity designated by the United States Copyright Office to develop and administer a mechanical licensing system for sound recordings in the U.S., which will formally launch on January 1st, 2021.

The MLC will oversee the collection and distribution of royalties payable to songwriters and copyright holders for music distributed through digital streaming platforms such as Spotify, Pandora, and Apple Music.

The MLC will provide public disclosures, including information about royalty collection and distribution, as well as executive compensation, projected budgets, and major expenses.

In a joint statement, MLC Board Chair Alisa Coleman and DLC Board Chair James Duffett-Smith said: “Today’s agreement between the MLC and the DLC represents a landmark achievement for every facet of the music industry. As a result of this accord, the central feature of the Music Modernization Act will be able to commence operations with the resources necessary to help ensure its success.”

“Overall, this agreement is a great step forward for all of us within the music community and clearly builds off the tremendous progress we made with the passage of the Music Modernization Act. With this phase behind us, we will now continue our work together to finalize the operations and other requirements under the law as we prepare to help songwriters get the royalties they are owed,” the statement continued.

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