BMI and Radio Industry Reach Interim Accord for Internet Radio Station Streaming

Posted in News on November 28, 2001

BMI has announced that the BMI rate court has approved an interim license agreement for radio stations streaming their over-the-air broadcast signals on the Internet. The agreement is available to radio stations represented by the Radio Music License Committee (RMLC), which is currently involved with BMI in a proceeding in the United States District Court for the Southern District of New York to determine final license fees and terms for broadcasting music in the BMI repertoire over-the-air and streaming broadcast signals on the Internet. In the proceeding, the RMLC’s position is that stations do not need a separate BMI license for streaming their over-the-air signals and should not have to pay separate fees to BMI. BMI’s position is that a separate license is required and that stations should pay 1.8% of gross revenues (less certain deductions) from their web sites, the same as the proposed over-the-air broadcast rate.

BMI has been licensing radio stations’ broadcasts on the Internet since 1998 and was the first performing rights organization to license music on the web with a license issued in April 1995. The Internet streaming license was agreed to by BMI and the RMLC as an interim measure pending the outcome of the rate court proceeding. The agreement will be offered to a majority of U.S. radio stations that are re-broadcasting their signals on the Internet. According to BRS Media, there are approximately 1,800 radio stations simulcasting their signals on the Internet.

BMI’s interim fees for stations already covered by a BMI blanket license will be 1.605% of the station’s streaming Internet revenue. This rate is the same as the interim rate those stations pay BMI for over-the-air broadcasting. BMI per program-licensed stations who simulcast their stations’ signal will pay the same net effective license fee as their over-the-air per program rate. The minimum fee for all stations streaming BMI music is $259 per year commencing in 2001 and increasing by CPI annually. The agreement also provides for retroactive coverage for stations that may have been streaming their signals online since 1997. The interim fees may be subject to either an upward or a downward adjustment based upon the court’s final decision in the rate proceeding.

“BMI believes that streaming will increasingly become an important way for stations to extend their brand and image and connect with their listeners,” said John Shaker, Senior Vice President, Licensing, BMI. “Radio stations that stream their signal over the Internet also affords BMI writers, publishers and composers greater exposure of their music and hopefully an additional source of income in years to come.”

Founded in 1940, BMI is one of the few established music companies to embrace the Internet to proactively develop new revenue streams for songwriters. BMI.com’s Digital Licensing Center provides Internet companies with an instant, simple Klik-Thru licensing solution to legally stream any of its approximately 4.5 million registered musical works.

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