Renewed push for streaming rate increase in US as songwriters secure big win on physical music royalties

Renewed push for streaming rate increase in US as songwriters secure big win on physical music royalties

The Copyright Royalty Board in the US is set to approve a 32% increase in mechanical royalties for physical music and downloads.

The proposed increase in songwriter and publisher royalties has been agreed in a motion signed by the Recording Industry Of America (RIAA) and National Music Publishers Association (NMPA). Major labels have signed off on the increase in mechanical royalties.

The CRB needs to formally approve the rate, which will go up from 9.1 cents to 12 cents per track. It will come into effect from 2023.

The move has been welcomed by trade organisations, following wrangling over the proposed increase. 

But the battle continues on a new streaming royalty rate for 2023-27 to be determined by the CRB. Mechanical royalties from streaming now vastly outweigh those from physical music and downloads.

Sony Music Publishing chairman & CEO Jon Platt has described it as the “most critical issue facing songwriters and music publishers in the United States”.

Ahead of a decision on streaming, the increase in the royalty rate for physical music and downloads is still a very good result for songwriters and publishers. 

“This new settlement gives songwriters a 32% raise on sales of vinyl, CDs and downloads - raising the rate from 9.1 cents to 12 cents - and critically also includes a yearly cost of living adjustment to address inflation,” David Israelite (pictured), NMPA president and CEO. “This extremely positive result is due in large part to the creators who made their voices heard in the CRB process. 

“With this settlement filed, we clear the way to focus solely and tirelessly on raising streaming rates. As we battle the biggest companies in the world, who are pushing for the lowest royalty rates in history, songwriters and their advocates stand more united than ever.” 

In the UK, the Ivors Academy welcomed the move, which benefits British songwriting talent in the US.

“The Ivors Academy of UK songwriters and composers welcomes the news that the value of songwriting and publishing rights are beginning to be better recognised,” said CEO Graham Davies. “This is an important settlement and indicates the necessary direction of travel.” 

“After wide consultation with songwriters, publishers, and labels, we are glad to have reached a solution we believe addresses the core concerns of the CRB judges and the individuals and organisations who shared their views during this proceeding,” said RIAA CEO Mitch Glazier. “As a music community, we are strongest when we come together to forge lasting and sustainable win-win deals.”

In a statement, the Artist Rights Alliance said: “This settlement is a meaningful win for songwriters who will see a 32% jump in royalties for physical music sales and downloads starting in 2023, while locking in future increases to keep up with inflation for the life of the deal. We are so grateful to the many grassroots songwriter advocates who refused to accept a status quo settlement and kept banging on the door of the CRB until they were heard.”

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