iTunes + RIAA = winners: Songwriters, music sellers happy with royalties
by Jordan Bartel | October 2, 2008 at 9:46 pm
Posted in b the paper, celebrity, entertainment, music
From today’s b, the paper
The federal Copyright Royalty Board on Thursday left the royalty that songwriters receive on sales of CDs and digital downloads at 9.1 cents per song for the next five years.
Both songwriters and music sellers applauded the ruling — but for different reasons. Apple Inc., which had threatened to shutter its iTunes store if the rate increased, appeared to have scored a clear win.
“We’re pleased with the CRB’s decision to keep royalty rates stable,” said Tom Neumayr, an Apple Inc. spokesman.
The Recording Industry Association of America, representing record labels, was pleased that the rate was frozen for the first time since 1977, meaning that if song prices increase, royalties will make up a falling percentage of the companies’ costs.
“No party got everything it wanted, yet at the end of the day, the certainty provided by this ruling is beneficial,” said Mitch Bainwol, chief executive of the RIAA.
The last government hearing to set the so-called mechanical royalty rate was in 1980 and was triggered by a change in federal law.
Part of the disagreement stemmed from the vast array of new ways of distributing music and the rise of digital downloads — driven in large part by Apple’s iTunes store. Downloads had never been treated separately from CD sales, which are plummeting.
The Digital Media Association, representing online music stores including Apple and Amazon.com, said the decision will “help digital services and retailers continue to innovate and grow for the next several years.”
The National Music Publishers’ Association, which represented songwriters in the case, was happy the fees weren’t cut in a declining music market.
For ringtones, the federal agency set a new rate of 24 cents, roughly in line with industry practice of paying songwriters 10 percent of revenue on each $2.50 ringtone. {AP}
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{compiled by Jordan Bartel, b}
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October 2nd, 2008 at 11:27 pm | Please log in to reply. | Log in to rate this comment | report this comment
Do people still pay for music?
!