AUSTIN, TX. (Top40 Charts/ Mood Media Corporation) Last week, the Second Circuit affirmed two trial court victories DMX obtained against performing rights organizations ASCAP and BMI. The ruling resets fee structures and limits market power long held by ASCAP and BMI.
In order for businesses to legally use music in commercial environments, they must pay fees to copyright owners. For years, performance rights organizations such as ASCAP and BMI, together with a third, significantly smaller performance rights organization called SESAC, had faced little or no competition in licensing compositions for public performance to music users. Rather than relying solely on licenses provided by performing rights organizations such as ASCAP and BMI, in 2006, DMX began directly licensing musical compositions for use in DMX services. DMX saw this as a way to compensate publishers directly as well as a way to achieve savings in an increasingly competitive industry. It also set a precedent allowing publishers to negotiate and license their music directly with commercial music providers such as DMX and Muzak.
"This is an important decision for our industry and music publishers, composers and authors," said Chris Harrison, Global
Director of Content/ Licensing for Mood Media. "We have effectively loosened the middle man's grip on licensing and associated performance rights fees. After decades of imbalance, the playing field is at last fair and consistent."
Through the court's affirmation, there is greater incentive for music users to license music directly. Authors, composers, and publishers will have the opportunity to increase the exposure of their content through commercial music channels. Additionally, payments of associated royalties through direct licensing will be more efficient and consistent with more timely payments and transparency into the usage of the music.
The new fee structures were incorporated into DMX's model after the initial court ruling in 2010. Last week's decision ensures that the new fee structures will remain and DMX will continue to be able to pass along greater value to our clients. "We're happy that we can continue to provide quality music programming and services to our clients at affordable and competitive rates. We're also excited about what this means for our ability to curate great music from even more artists and share that with our clients and their customers," said Harrison.
Weil, Gotshal & Manges LLP served as legal counsel for DMX, Inc.
About DMX
A Mood Media company, DMX has been designing and delivering brand-enhancing services to retailers and retail brands for over 40 years. With creative services and leading delivery technology, DMX designs and delivers unique and memorable brand experiences for businesses to connect with their customers and become an integrated part of their lifestyle. The DMX suite of services includes music services, strategies, and promotions, music licensing, video and digital signage, audio/visual system design, as well as scent marketing, and mobile and audio messaging solutions. In partnership with Pandora®, DMX brings the industry's first fully licensed personalized internet radio specifically for business.
For more information, please visit www.dmx.com.
