MUMBAI: The Radio Music License Committee (RMLC) and The American Society of Composers, Authors and Publishers (ASCAP) have announced a 'settlement in principle' concerning the fees payable by America's radio stations, to publicly perform ASCAP's 8.5 million plus musical works through 2016.

The settlement, when finalized, will cover the seven-year period 2010 to 2016. It would end ongoing Federal Rate Court litigation and provides for a return to a revenue-based fee structure as well as expanded coverage to accommodate the radio industry's newer distribution platforms for reaching listeners by means such as Internet websites, smart phones and other wireless devices. It also greatly simplifies the reporting process and administrative burden through electronic filing.

The RMLC represents the majority of the nation's radio stations (over 10,000 radio stations) and ASCAP represents the majority of musical compositions played on the radio today through the creative output of its 425,000 songwriters, composer and music publisher members.

RMLC chairman & CEO of Saga Communications Ed Christian said, "This is a gratifying result for the radio industry, which reflects the current realities of our industry and puts the industry back on sound footing insofar as its licensing relationships with ASCAP are concerned. We appreciate the good will which ASCAP has demonstrated in working with our industry to get this resolution."

ASCAP CEO John LoFrumento said, "The process of building this agreement was based on mutual trust and appreciation, and reflected both sides' clear understanding of the challenges and opportunities we each see for the future. I want to thank the Radio Music License Committee for its creative approach in respecting the value provided by music creators in our negotiations."

Performance rights organizations — namely ASCAP and Broadcast Music Inc. — collect performance royalties generated from radio airplay for songwriters. Since 2003 and 2004, radio stations have paid those royalties through a flat fee. As revenue has fallen, those fees have become an ever-growing expense for the radio industry. Under the new agreement, the payment system will return to one based on station revenue. An ASCAP spokesperson said additional details of the still tentative agreement were not immediately available.