Music industry avoids legal battle with new streaming royalty deal

guest · Sep 3, 2022

The deal marginally increases royalties but may benefit publishers in other ways.
By Steve Dent @Stevetdent - September 1, 2022

Music publishers, songwriters and musicians have struck a deal with streaming services for US mechanical streaming rates for 2023-2027, the National Music Publishers’ Association (NMPA) has announced. The NMPA, Nashville Songwriters Association International (NSAI) and Digital Media Association (DiMA) agreed on a 15.35 percent rate, avoiding a potentially contentious battle.
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That's up only mildly from the 2018-2022 rate of 15.1 percent. It's also less than expected, according to Variety, as the NMPA previously said it was pushing for 20 percent. However, the agreement will reportedly also modernize the way "bundle" rates offered to students and families are treated, and increase so-called Total Content Costs, to make up some of the difference.

"This agreement... ensures that all parties will benefit from the growth of the industry and will be motivated to work together to maximize that growth," the press release states. "Instead of going to trial and continuing years of conflict, we instead of move forward in collaboration with the highest rates ever, guaranteed," added NMPA's CEO David Israelite.
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NMPA: NMPA, NSAI, and DiMA Announce Landmark Agreement for Phonorecords IV Proceeding

Washington, D.C. – The National Music Publishers’ Association (NMPA), the Nashville Songwriters Association International (NSAI), and the Digital Media Association (DiMA) today announced a settlement for certain mechanical streaming rates in the U.S. for the years 2023-2027. The agreement will provide higher royalty rates for songwriters and music publishers, promote sustainability, innovation, and continued investment for the entire industry, and usher in a new era of collaboration between all parties.

Per the agreement, the headline royalty rate will be set at 15.35%, which will be phased in over the five-year term. This new rate comes as the Mechanical Licensing Collective is fully operational, delivering commission-free royalty payments as a result of the passage and implementation of the Music Modernization Act (MMA).
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Music industry avoids legal battle with new streaming royalty deal

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