Annual Minimum Webcasting Royalty Fees Due Jan. 31, 2014

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Broadcasters and others who stream music on the Internet must pay their minimum annual webcasting copyright royalty fees to SoundExchange by Jan. 31, 2014. These webcasting fees are in addition to public performance royalties paid to ASCAP, BMI and SESAC for the underlying musical compositions. For 2014, the annual minimum webcasting fee is $500 per channel (up to $50,000 for those who are webcasting 100 or more channels).

Monthly use reports must be filed with SoundExchange unless a station qualifies as a “small” broadcaster, defined as having less than 27,777 aggregate listening hours per year. This averages to 70 webcasting listeners per hour (Note: This is unrelated to the number of over-the-air broadcast listeners). Broadcasters who wish to be treated as small broadcasters exempt from the monthly reporting requirements must make this election by Jan. 31, 2014.

The 2014 annual webcasting fee for broadcast licensees is $0.0023 per performance. A performance consists of one listener listening to one song. In other words, that fee needs to be multiplied by the number of listeners and number of songs streamed over the Internet to determine the actual fee due. SoundExchange will credit the minimum annual fee toward the actual fee due. Once the minimum fee is exceeded, however, broadcasters must pay any additional fees due to SoundExchange on a monthly basis. The monthly reports, due 45 days after the end of each month, are to include both playlists and audience measurements.

Aside from broadcasters and small broadcasters, SoundExchange has categories for commercial webcasters (the default category), “small” webcasters, “pureplay” webcasters, “small pureplay” webcasters, and a host of categories for noncommercial entities. Each of these categories has its own fee structure, although NPR and other CPB-related stations are covered by an annual fee paid by CPB and do not need to file or pay anything to SoundExchange.

All of the services covered by the SoundExchange royalties are “noninteractive” services, meaning that the listeners do not get to choose the songs heard. Interactive webcasting services must be separately licensed by the copyright owners.