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David Israelite, CEO of US's National Music Publishers Association (NMPA), has called for a number of changes to the way the US music publishing business runs, both in the way publishers licence digital rights, and in the way American copyright law applies to digital licensing and the way collecting organisations operate. In particular the NMPA boss was critical of American record labels who are utilising contract clauses to avoid giving publishers their share when they are paid by online video sites, in particular VEVO, which includes major labels Sony and UMG amongst shareholders.
In February we blogged about comments from indie publisher Matt Pincus, who had said his company was receiving no income from the booming music video service, because in the US VEVO had deals with the record companies (including Sony and UMG) that put the obligation to pay publishing royalties onto the labels, rather than paying royalties direct to the publishers - and the labels used contract clauses relating to promotional videos to say that the payment of song writing royalties could be avoided. An unhappy Israelite took this a stage further saying "Today you have VEVO talking about reaching $150 million in revenue and wanting to grow to $1 billion, and a large amount of the music videos being played are not getting licensed [by our members] and publishers are not being paid. NMPA is going to put an end to that".
Billboard here
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UPDATE FROM THE CMU DAILY
Universal Music Group has agreed to a "groundbreaking licensing model" that will ensure American publishers get paid when their songs appear in videos owned by the major that in turn appear on VEVO.
Confirming the agreement, Israelite told reporters: "We're all navigating through a rapidly changing business environment and NMPA's job is to ensure that the rights of every songwriter and music publisher are protected. This is a model example of how record labels along with songwriters and music publishers can move forward together to ensure that the licensing process is more effective and efficient, and that all creators are fairly compensated".
Billboard says publishers could get 15% of the ad revenues generated by VEVO for Universal videos, and that that royalty will be paid back to 2008, albeit with a lesser share for the first two years. It's thought mechanical rights administrator the Harry Fox Agency will manage payments.
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