SoundExchange submits Sirius XM rate proposal for 2018-2022

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SoundExchange has submitted its rate proposal to the Copyright Royalty Board for Sirius XM’s satellite radio service for the period from 2018-2022.

SoundExchange’s testimony, in the SDARS III rate proceeding, also covers rates for the US cable/satellite TV music services provided by Music Choice and Muzak.

The CMO has submitted testimony from economists, other experts and representatives of recording artists, major labels and indie labels in support of its proposal.

Based on the analysis of its experts, SoundExchange has proposed a rate that is the greater of (i) 23% of revenue and (ii) per subscriber rates starting at $ 2.48 per subscriber per month in 2018 with moderate annual increases.

The current rates for Sirius XM’s satellite radio service are 10.5% of Sirius XM’s “Gross Revenues” as the CRB’s regulations define that term) in 2016 and 11% in 2017.

For Music Choice and Muzak, SoundExchange proposed a per subscriber per month rate starting at $ 0.019 per subscriber per month with annual increases. The current rate for Music Choice’s and Muzak’s cable/satellite TV music services is 8.5% of Gross Revenues in both 2016 and 2017.

In the three months to end of June, Sirius XM boasted 30.6m subscribers, up 8% on Q2 2015.

Last year, SoundExchange was left disappointed by the CRB’s decision to set per-spin US webcasting rates for the likes of Pandora at $0.0017 for non-subscription and $0.0022 for subscription.

That was up slightly on the $0.0014 per ad-funded stream previously paid by Pandora – but SoundExchange had pitched for a $0.0025 per-spin non-subscription rate.

“Artists and labels will be paid more as a result of the new rate than they would have made, overall, under the old rate,” SoundExchange President and CEO Michael Huppe told MBW last week.

“That being said, we think the judges got it wrong in terms of trying to accurately reflect the true market value of [music]. That’s why we’re appealing, but we’re moving forward. The rates are what they are.”

Regarding the SDARS III rate proceeding, SoundExchange will now be able to examine other parties’ rate proposals and testimony and submit rebuttal testimony by February 19, 2017.

The CRB will then hold a hearing beginning April 19, 2017, which will last several weeks. After final briefing by the parties, the CRB will issue its rate determination by December 15, 2017.Music Business Worldwide

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