Digital Licensing Simplified pt.2

When terrestrial radio stations stream their content on the Internet, there are additional licensing fees to be paid to the copyright holders.  The RMLC (see last post)  negotiated licensing agreements with both ASCAP and BMI on the behalf of their members in 2005 that bundled licensing fees for streaming in with the licensing fees paid for the terrestrial broadcast, as long as it is an exact simulcast of the terrestrial broadcast.  This agreement expired in 2009, but stations were allowed to continue under the existing agreement while negotiations were ongoing.

On Dec 5, 2011 a tentative agreement was reached with ASCAP that when finalized will cover the period retroactively of January 2010 through December 2016.  The new agreement returns to a revenue based structure and includes expanded coverage to new distribution platforms such as smart phones and other wireless devices.  The administrative burden of reporting has been simplified with electronic filing.  A similar agreement is expected to be reached with BMI as well.

SESAC has a web site addendum for terrestrial radio stations that wish to stream their broadcasts.  The fee structure is based on the station’s metro survey area as designated by Arbitron and the station’s high one minute spot rate.  If a station is not located in an Arbitron designated metro survey area, the US Census population for the county in which the station’s FCC city of license is located will be used in conjunction with the station’s high one minute spot rate.  As an example, for 2012, if your county population is between 10,000 and 49,999 and the high one minute spot rate is between $12.50 and $19.99 your yearly additional fee is $660.  If you are a talk station, your yearly liability is $348.  This additional fee is paid on the same schedule as your terrestrial licensing fees.

Next week, we’ll explore the RIAA and Sound Exchange.  Here’s a hint, it’s not nearly as confusing or expensive as you’d think!

Disclaimer: The information is presented for informational purposes, you should consult with legal council or adviser for more detailed information.

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