NMPA, NSAI & DiMA End 2022 With Landmark Agreement For Phonorecords IV Proceeding

Following an already impactful year for songwriters and music publishers, 2022 closed with the news that the Copyright Royalty Board accepted the settlement from the National Music Publishers’ Association (NMPA), the Nashville Songwriters Association International (NSAI), and the Digital Media Association (DiMA) for certain mechanical streaming rates in the U.S. for the years 2023-2027.

The agreement will provide higher royalty rates for songwriters and music publishers. The headline royalty rate will be set at 15.35%, which will be phased in over the five-year term.

The deal also includes further changes, such as increases to the per-subscriber minimums and the “Total Content Costs” (TCC) calculations, which reflect the rates that services pay to record labels. The agreement also modernizes the treatment of “bundles” of products or services that include music streaming and updates how services can offer incentives to attract new subscribers into the music ecosystem.

“Starting January 1, songwriters will enjoy the highest rates in the world and the highest rates in the history of digital streaming,” shares NMPA President & CEO David Israelite. “Thanks to the many songwriter advocates who worked hard to make this happen. There are still many challenges ahead to ensure that songs receive their proper value, but the future is bright.”

He adds, “This historic settlement is the result of songwriters making their voices heard. Instead of going to trial and continuing years of conflict, we instead move forward in collaboration with the highest rates ever, guaranteed. We thank the digital services for coming to the table and treating creators as business partners. Critically, since this is a percentage rate, we know that as streaming continues to grow exponentially, we will see unprecedented value of songs.”

Supported by DiMA member companies Amazon, Apple, Google, Pandora and Spotify, as well as NSAI’s Board of Directors and the NMPA Board, the new agreement ensures that all parties will benefit from and be motivated to work together to maximize the continued growth of the industry.

“This collaborative process will lead to increased songwriter compensation from digital streaming companies and locks in our historic 43.8% increase from the previous CRB proceeding,” notes NSAI Executive Director Bart Herbison. “Along with the upward rate momentum there are also new structures to help ensure minimum payments.”

“This agreement represents the commitment of the streaming services to bringing the best music experiences to fans and growing the streaming ecosystem to the benefit of all stakeholders, including the creative foundation of songwriting. For streaming services, this moment presents an opportunity to pursue new collaborations with publishers and songwriters in the context of economic certainty that will support continued innovation,” explains Garrett Levin, DiMA President and CEO. “Perhaps more than anything, this agreement demonstrates the potential for industry progress when parties come to the table for good faith discussions.”

The settlement in its entirety can be viewed here.