It was great to see some of you at Music Biz last week in Nashville!
We are excited to share that earlier this week (on Tuesday, May 23) the Copyright Royalty Board (CRB) issued its initial rate determination for the Phonorecords III (Phono 3) rate period. Please continue reading to learn more about the Phono 3 initial determination and next steps for both The MLC and DSPs.
In this month’s newsletter, we share more information about what you can expect now that the initial rate determination has been issued, as well as the key metrics from this month’s royalty distribution and the latest on our efforts to process and distribute matched historical royalties for older uses that took place between 2007 and 2017.
May Royalty Distribution Recap
We completed our fifth monthly royalty distribution of the year two days early, on May 12, bringing us to 26 total royalty distributions since we began full operations — all of which have been on time or early. May’s distribution primarily covered newly reported usage that took place in February of 2023. The total of all royalty pools reported to The MLC for this cycle was approximately $79.4 million. Once again, we were able to match approximately 85 percent of that amount to songs currently registered in our database.
After deducting royalties for usage covered by voluntary licenses maintained by DSPs with rightsholders, we collected approximately $75.4 million in royalties and distributed approximately $55.4 million to our Members. To learn more about our May distribution and an update about the historical unmatched data available in The MLC Portal, click here.
PHONO 3 INITIAL RATE DETERMINATION
On May 23, the Copyright Royalty Board (CRB) issued its initial rate determination for the Phono 3 rate period. This initial determination and the publication of the corresponding regulations that accompany the initial determination represent the next important step in the CRB’s process of finalizing the rates for the Phono 3 rate period. Once the rate determination is finalized and published in the Federal Register, DSPs will have 6 months to deliver revised data and any royalties they may owe under the final Phono 3 rates — both for the historical unmatched usage previously reported (for 2018, 2019 and 2020) and for usage under the blanket license previously reported (for 2021 and 2022). The MLC has already begun working with DSPs to prepare for their delivery of this revised usage data. We will continue to keep you updated on progress in the coming months. For more information, you can read more and check out our hypothetical timeline here.
