SiriusXM have been told to increase the royalties they pay out for music plays, which is great but now their stock is falling.
Online radio service SiriusXM has been told by the US Copyright Royalty Board to increase their payouts to rights-holders. As a result the satellite broadcaster has increased the amount it pays by 40% on over 100 channels for the next four years.
President and CEO of rights management agency, Michael Huppe said: “We thank the CRB for its work and appreciate their consideration of the case we laid out. SoundExchange is dedicated to our mission of ensuring that creators are properly recognised and compensated for the use of their work. And while the Copyright Royalty Board did not adopt the rates we proposed for Sirius XM, its ruling demonstrates an important step in the right direction toward valuing the contributions of the music creators represented by SoundExchange.”
Whilst this is fantastic news for artists and rights-holders, resulting in 15.5% of profits going to artists rather than 11% from before, SiriusXM aren’t quite seeing the benefits of the arrangement. Since the increase was announced SiriusXM’s stock has been falling, closing on Friday down 5.3% at $5.36.
SoundExchange CEO, Huppe added: “There’s no reason recording artists and record labels should subsidize a company as profitable as Sirius XM. Everyone should play by the same rules, and it is a long past time for Congress to change the standard that currently forces music creators to subsidize flourishing companies whose success is built on top of the music.”