Happy New Year, everyone! In this newsletter, we share the key metrics from this month’s royalty distribution, an update about Phono 3 royalties, details about the periodic review of The MLC’s designation and information about the audit notices that we sent to DSPs this month.  

Thank you for taking the time to read our updates every month. We look forward to serving you in the year ahead. 

This month’s distribution, our first of the year, was completed on January 12. This brought us to 34 total royalty distributions since we began full operations — all of which were on time or early. January’s distribution primarily covered newly reported usage that took place in October of 2023. The total of all royalty pools reported to The MLC for this cycle was approximately $98.4 million — our highest total to date!

Every month our team attempts to match sound recording uses to the musical works data in our public database and then distributes the resulting matched royalties to our Members. This month, we were able to match nearly 85 percent of the total royalty pools we administered to songs currently registered in our database.   

After deducting royalties for usage covered by voluntary licenses maintained by DSPs with rightsholders, we collected approximately $94.0 million in royalties and distributed approximately $68.6 million to our Members.  

Finally, we have one correction to make about the year-end metrics we shared in the December newsletter. As of the December 2023 distribution, The MLC had distributed more than $179 million in voluntary royalties, not $179 thousand, as previously reported.  

To learn more about our January 2024 distribution, click here: 

As you may recall, The MLC has still not been able to distribute any matched royalties from the Phono 3 rate period because the rates for that period were only finalized by the Copyright Royalty Board (CRB) in August 2023, and the applicable regulations give DSPs until next month (February 9, 2024) to deliver the data for any retroactive adjustments they need to make to the data they originally delivered to The MLC based on the new final rates.   

After DSPs have delivered the required adjustments to their prior usage reporting for these Phono 3 historical uses, The MLC will finally be in a position to begin distributing matched historical royalties for uses that took place during the Phono 3 rate period. We anticipate we will begin distributing matched historical royalties from the Phono 3 rate period later this spring. 

For more information about our current estimated timeline for distribution, click here.

On January 30, the Register of Copyrights initiated the periodic review of the designation of The MLC, as required by The Music Modernization Act (MMA) every five years. During this review period, the Register will collect information concerning whether the designation of The MLC should continue. At the end of any proceedings, the Register can continue the designation of The MLC or make a new designation (if The MLC does not meet the criteria established by the MMA). During this process, the Register cannot change the provisions of the MMA, the structure of The MLC’s governance that is established in the MMA or the blanket license royalty rates or terms. To read the official notice, click here. To read more information about the periodic review of designation, click here.

In case you missed it, The MLC sent notice letters to 49 digital service providers (DSPs) that operate under the blanket license The MLC administers. These notices preserve The MLC's right to audit the DSPs’ books and records to verify the accuracy of the royalties they have paid to The MLC for uses that took place in 2021, 2022 and 2023. We will clearly identify any royalty adjustments that are made as a result of audits on the royalty statements for each impacted Member. You can read more about this process here. 

February 21-25: Folk Alliance Conference 

March 8-16: SXSW 

March 17-20: Musexpo 

March 21-23: MEIEA Summit 

© 2023 Mechanical Licensing Collective. All rights reserved.