April 2023 updates from The MLC

This month, we are excited to share that our Members are receiving their royalties at the new Phono 4 rates for the first time. In this newsletter, you can read a summary of the key metrics from this month’s distribution, more about the new Phono 4 rates and other updates from The MLC. As always, thank you for taking the time to read our updates each month. We hope to see you at some upcoming industry events this spring!

April Royalty Distribution Recap

We completed our fourth monthly royalty distribution of the year on April 14, bringing us to 25 total royalty distributions since we began full operations — all of which have been on time or early. April’s distribution primarily covered newly reported usage that took place in January of 2023. The total of all royalty pools reported to The MLC for this cycle was approximately $83.6 million. Once again, we were able to match 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 $79.6 million in royalties and distributed approximately $58.7 million to our Members. To learn more about our April distribution and the historical unmatched data available in The MLC Portal, click here.

Members Received Royalties at New Phono 4 Rates This Month

Since the new year, we have been working closely with the DSPs who utilize the blanket license to help them prepare to report royalties to us at the higher Phono 4 rates that began to apply starting with their January 2023 usage. (These new rates were finalized by the Copyright Royalty Board at the very end of December 2022.) With this month’s royalty distribution, we have begun distributing royalties calculated using the new Phono 4 rates for uses that took place in January 2023. As a refresher, you can read more about the Phono 4 rate change here.

What does a blanket license termination mean for Members

Last week you received a notice letting you know The MLC terminated the blanket licenses for two DSPs, eMusic and PANTHR, effective as of April 15, 2023. The blanket license was terminated because each DSP did not comply with certain statutory obligations, even with notice from The MLC and a two-month opportunity to correct the issues cited by The MLC.

What does this mean for you? These two DSPs can no longer rely on the blanket license for the rights to make and distribute digital copies of your songs. Instead, they will have to license your songs from you and pay you mechanical royalties directly. You will not receive royalty payments from The MLC for any uses of your songs by these services after the date of termination. However, you may still receive royalties from The MLC for uses that took place prior to termination, to the extent that we are able to make any new matches of these prior uses as a result of reprocessing.