News

SoundExchange has filed a lawsuit against satellite and streaming radio service SiriusXM, accusing them of not paying music labels the royalties they are owed. The lawsuit claims that SiriusXM is liable for approximately 0 million in unpaid royalties after bundling its satellite and streaming services together. Unlike traditional AM and FM radio, satellite and streaming radio providers are required to pay for public performances of copyrighted music. SoundExchange is an organization that collects royalty payments from services like SiriusXM on behalf of record labels.

In recent years, SiriusXM has passed the cost of royalty payments on to consumers through a surcharge called the U.S. Music Royalty Fee, which is applied to packages that offer access to commercial-free music channels. The fee has typically been higher on satellite radio plans compared to streaming-only plans. However, SiriusXM changed its approach and started bundling its streaming radio service with satellite radio plans, leading to a dispute over how much they owed in royalties.

The lawsuit alleges that SiriusXM used an arbitrary formula and creative accounting to determine how much revenue should go toward royalty payments. As a result, SoundExchange claims that SiriusXM has been paying approximately 25% less in royalties than before the change. An independent auditor hired by SoundExchange concluded that SiriusXM had improperly withheld some payments that should have been covered under the rates set by the Copyright Royalty Board.

SoundExchange tried to resolve the matter without a lawsuit, but SiriusXM refused to make back payments. The lawsuit was filed as a last resort to ensure that artists and rights owners receive their fair share of royalties. SiriusXM has responded to the lawsuit, stating that they have adhered to regulatory requirements and have been transparent in their methodology.

This lawsuit comes at a challenging time for SiriusXM, as they are seeing slow subscriber growth and are looking to streaming and other digital products for additional revenue sources.

The post SiriusXM Faces Lawsuit for Unpaid Royalties appeared first on satProviders.