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U.S. Justice Department to Review Music Streaming Royalties

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In the wake of a series of court cases involving music streaming service Pandora, the Antitrust Division of the U.S. Justice Department has announced that it plans a review of the agreements that govern songwriting royalties. The DOJ said it would review the consent decrees, which in some cases date back to 1941, between two major performing rights organizations, the American Society of Composers, Authors and Publishers (ASCAP) and Broadcast Music Inc. (BMI).

Publishers have long argued for higher royalty rates for their members on music played on streaming services such as Pandora and they maintain that consent agreements interfere with their ability to bargain for better rates.

“The Department understands that ASCAP, BMI and some other firms in the music industry believe that the Consent Decrees need to be modified to account for changes in how music is delivered to and experienced by listeners," a spokesperson for the department wrote in a statement.

The DOJ review follows a series of court cases over the royalty rates. In 2012, Pandora sued ASCAP, seeking to lower the royalty rates it pays on streamed music. The judge in the case denied ASCAP's request that the royalty rate increase over time and set the rate at 1.85 percent of revenue from 2011 to 2015.

BMI in turn sued Pandora in 2013, requesting what they described as reasonable rates. Their request was denied but the case is still pending. - via CelebrityAccess

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