Broadcast Music, Inc. (BMI) has reported $898.8 million in revenues for its fiscal year ended June 30, 2012. The Company announced distributable royalties of $749.8 million for the year. BMI serves more than 650,000 licensed businesses and 550,000 songwriters, composers and music publishers. BMI’s revenues are down approximately 3% from fiscal year 2011, due primarily to the Company’s new agreement settling a rate litigation with the Radio Music Licensing Committee (RMLC) – the association that represents the vast majority of U.S. radio stations. Excluding the financial impact of the radio settlement, BMI revenues would have been up by more than 4%. A total of 40 billion performances from BMI’s catalog of 7.5 million musical works were processed during fiscal year 2012. BMI distributed payments on the largest number of individual musical works in its history in 2012.
The terms of the new radio agreement include a financial settlement and a return to a percentage of revenue fee structure. The short term impact of the settlement lowers BMI licensing fees for radio for 2010 through 2012 with an opportunity to rebound as the radio industry resumes revenue growth. As part of BMI’s commitment to fiscal responsibility, the Company operates under generally accepted accounting principles (GAAP) and recognized the entire financial impact of the radio settlement in fiscal year 2012. As a result, BMI moves into fiscal year 2013 unencumbered by prior financial obligations related to the agreement. Going forward, BMI projects a Companywide return to revenue and royalty distribution growth, resuming an historical unbroken twenty year record of year-over-year increases.
“BMI has weathered the economic storm remarkably well considering the negative conditions that have impacted many of our revenue sources,” said BMI President and CEO Del Bryant. “Our distributions to music publishers and songwriters have remained predictable and reliable. Even with the retroactive radio settlement and a challenging financial landscape, we have still been able to return nearly 84 cents of every dollar we have generated back to our publishers and songwriters. Our performance in fiscal year 2012 under these difficult conditions is a testament to our prudent fiscal management and to our resolve to responsibly manage the copyrights and income entrusted to us by our publishers and songwriters.”
The impact on total revenues from the radio settlement was significantly blunted by revenue increases in international, general licensing, cable networks and digital media. For the first time, international revenues, which reflect the popularity of the BMI repertoire around the globe, accounted for more than a third of BMI’s total revenue, totaling $302 million, up 12% from the prior year. General Licensing revenue from physical establishments such as restaurants and nightclubs saw an impressive 8% increase to a new high of $108 million. New media and digital revenue reached an all-time high of $35 million, representing an increase of 27% over fiscal year 2011 and generating 6% of domestic revenue primarily due to the rise in music use by BMI’s 10,000 digital licensees.
In fiscal year 2012, the BMI repertoire was widely celebrated at home and across the globe. BMI songwriters and composers including Lady Gaga, Foster the People’s Mark Foster, Maroon 5, Benny Blanco and Pitbull, Taylor Swift, Nicki Minaj and Band Perry wrote many of the most-played hits of the year. The BMI repertoire garnered 68% of the Grammy Awards, 89% of the Academy of Country Music Awards, 75% of the BET Awards and 70% of the Billboard Latin Music Awards. On the film and television front, BMI composers including Mike Post and John Williams created the background or theme music in 73% of primetime television programming and in the majority of the year’s top grossing feature films. BMI also represents the finest talent from around the world ranging from Elton John (PRS), Sting (PRS), Eric Clapton (PRS), The Who (PRS), Alexandre Desplat (SACEM), to current chart toppers Adele (PRS), One Direction (PRS), and Gotye (APRA).
BMI operates with an overhead among the lowest of any music rights organization in the world, an achievement made possible by streamlined operations and technological innovations that define industry standards. The results enable BMI to meet its mandate to support its songwriters, composers and music publishers, and to provide efficient access to the BMI repertoire for its licensees. As the Company returns to a new cycle of year-over-year growth, BMI is determined to continue fostering talent, educating and building awareness of the value of music across the entertainment industry.