| Dear NMPA Member and prospective member: |
On Monday, January 28, 2008, the Copyright Royalty Board (CRB) began the hearing that will determine mechanical rates for every songwriter and music publisher in America. It is the most important rate hearing in the history of the music industry because in addition to setting rates for physical products, rates will be set for the first time ever for digital products such as digital downloads, subscription services and ringtones.
The National Music Publishers' Association (NMPA) is representing the interests of songwriters and music publishers and has fought vigorously to protect those interests to ensure that musical compositions are compensated fairly.
On the other side of this fight stands the Recording Industry Association of America (RIAA) and the Digital Media Association (DiMA). Both the RIAA and DiMA have proposed significant reductions in mechanical royalty rates that would be disastrous for songwriters and music publishers. This is literally a fight for the survival of our industry.
To give you an example of what is at stake, the current rate for physical phonorecords is 9.1 cents. The NMPA is proposing an increase to 12.5 cents per song. The RIAA, however, has proposed slashing the rate to approximately 6 cents a song - a cut of more than one-third the current rate!
For permanent digital downloads, NMPA is proposing a rate of 15 cents per track because the costs involved are much less than for physical products. The RIAA has proposed the outrageous rate of approximately 5 - 5.5 cents per track, and DiMA is proposing even less.
If you find that troubling, it gets worse. For interactive streaming services, which some analysts believe will be the future of the music industry, NMPA is proposing a rate of the greater of 12.5% of revenue, 27.5% of content costs, or a micro-penny calculation based on usage. The RIAA actually proposed that songwriters and music publishers should get the equivalent of .58% of revenue. This isn't a typo - less than 1%. And DiMA is taking the shocking and offensive position that songwriters' and music publishers' mechanical rights should be zero, because DiMA does not believe we have any such rights!
A final decision by the Copyright Royalty Judges is expected on October 2.
The NMPA is spending millions of dollars in this proceeding to protect the interests of songwriters and music publishers against the much larger record labels and digital media companies. And although we face such an enormous fight, we have an incredible advantage - we represent songwriters, without whom the record labels and digital music services could not exist.
As always, we appreciate your support of the NMPA which allows us to wage this fight on your behalf.
David Israelite
President & CEO
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| Add your voice to those of many other American music publishers. |
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