Happy New Year Songwriters! You’ve Got New Royalties
Happy New Year Songwriters & Music Publishers!
Take note of the new mechanical royalty rates that are now in effect for the use of your songs in the United States:
As of January 1, 2023, royalty rates are as follows:
• Physical / Permeant Download: 12¢ per minute or 2.31¢ per minute or fraction thereof, whichever amount is greater
• Interactive Streaming / Limited Downloads / Locker Services / Other Digital Deliveries: 15.1% of Service Revenue or Total Content Cost Prong Calculation, whichever amount is greater by offering.
As a reminder, if you own the publishing in your songs, you may be eligible to join The Mechanical Licensing Collective to get paid directly 100% of your digital audio mechanical royalties. This is a separate royalty stream, which your PRO (ASCAP / BMI / SESAC) does not collect or pay out. You earn two songwriter royalties when your songs are streamed on Spotify, Apple Music, Tidal, and other digital music services. You earn a performance royalty (ASCAP, BMI, SESAC) and a mechanical royalty (The MLC).
Learn more about The MLC at http://www.themlc.com and join for free today!
About The MLC in 60 Seconds:
My Thoughts On The MMA In Light Of The CRB Mechanical License Rate Decision
In light of the CRB’s ruling today to increase mechancial royalty rates for on-demand DSPs, I would caution against passing the Music Modernization Act without first amending it to include some very necessary guarantees for DIY musicians.
Given the recent ruling to increase mechanical rates, penalize DSPs for late payments, and remove the TCC cap DSPs will be more incentivized to cling to the safe harbor components of the MMA to limit their financial responsibility to songwriters.
I also fear that the blanket license (combined with the elimination of the statutory damages provision against infringement) would hurt more DIY musicians than protect compared to the existing compulsory licensing schema where today an independent can fully self-administer his/her mechancial rights via a service like TuneRegistry or with a third-party administrator like Songtrust. Why? Because the unclaimed/unpaid (aka “black box”) royalty fund will also increase by 44%, giving major publishers a bigger windfall of market share distributed gains from a royalty pool that generally belongs to unidentified independent songwriters.
What incentive does DSPs, who must pay the rates anyway, and major publishers, who will undoubtedly control the mechanical licensing collective body, have to ensure the works of DIY musicians are properly represented and accounted to and what power do DIY musicians have to assert their limited rights?
I could be completely and utterly wrong.
However, the devil is in the details and the MMA, while it does streamline the process of mechancial licensing in the United States for DSPs it also effectively limits the warranties and representations of DIY musicians.
Every article written about MMA is generally written from the perspective of publishers and NMPA members. As an advocate for and service provider to DIY musicians, my perspective is a bit different and more nuanced.
The decision today by the CRB was a win for all songwriters. The MMA is a win for major publishers. It must be amended.