RIAA agrees to royalties deal with streaming radio

The Recording Industry Association of America (RIAA), Digital Media Association, and National Music Publishers Association have worked together to reach an agreement regarding streaming radio and limited downloads.

The Songwriters Guild of America and Nashville Songwriters Association International also worked with the other organizations to reach the agreement.

According to the agreement, streaming broadcasters will pay up to 10.5 percent of their revenue towards music royalties, with a catch thrown in here or there.

Even though it’s not the official end, this surprise announcement could lead to the final chapter of the ongoing streaming media royalties issue.  In February, the feuding sides were unable to even try and agree on the type of license required to play music online, let alone the exact amount of royalties that should be offered in compensation.

The 10.5 percent is for a mechanical royalty that includes streaming of interactive and restricted streaming, and will include restricted downloads and ad-supported music.  Sites like Rhapsody and Napster To Go, which allow users to download songs for a monthly fee but don’t actually own the songs, is included in the first part of the deal.  The second part of deal covers sites such as imeem.com, which allows users to select which songs are streamed and played.

But the fate of popular Internet radio station Pandora is still uncertain, and there is more work to be done.  Pandora is an Internet radio service designed so each listener can create music stations catering to their own musical tastes.  Pandora said this latest agreement is an important step in the right direction, but licensing fees could still threaten Internet radio later down the road. 

Although one piece of the puzzle has been completed, the RIAA and other organizations must continue to work to try and figure out what to do with sites like Pandora.