CRB Abandons 9.1 Cent Mechanical Royalty, Setting the Stage for the Next Rate Battle
variety.comJem Aswad Senior Music EditorThe Copyright Royalty agreed to unfreeze the 9.1 cent mechanical royalty rate it pays to songwriters and publishers on Tuesday, setting the stage for the next battle over the rate in the 2023-2027 period.The rate, which is set every five years, is traditionally a hard-fought and contentious battle between music publishers and streaming services (and other digital providers), is likely to become even more heated with the change in the rate.
The 9.1-cent rate, which was agreed upon in 2008 at the beginning of what is called the Phono IV process, involves royalties for both physical (CD, vinyl and cassettes) and digital (streaming and downloads) formats.However, songwriter advocates argued that physical revenue is far less significant than streaming, which is overwhelmingly the dominant format and will be so for the foreseeable future, and worked to mobilize their efforts toward a higher streaming rate.
The CRB judges last year proposed continuing that rate for the 2023-2027 period, but songwriter groups and others argued for a higher rate, and the CRB has agreed.
Now the parties involved will either settle on a new rate or the process will into legal proceedings. The decision ties into an ongoing CRB rate battle between songwriters and publishers on one side and streaming services on the other.
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