The music industry reached a breakthrough agreement on Tuesday concerning the licensing of musical works for subscription-based online services.
The National Music Publishers' Association, musical copyrighting body the Harry Fox Agency and the Recording Industry Association of America (RIAA) agreed that online subscription services will have immediate access to every musical work authorised to be licensed by the Harry Fox Agency.
Effectively, this means access to 27,000 music publishers, representing more than 160,000 artists.
Licences will be available for internet subscription services featuring on-demand streaming, quantity limited downloads and time limited downloads.
A royalty payment system has not yet been agreed but, in the interim, the RIAA will pay Harry Fox $1m toward the royalties to be determined. After that, the association will continue to pay monthly advances totalling $750,000 a year until a rate is set.
"This agreement removes a major legal roadblock for the new online subscription services," said RIAA president and chief executive, Hilary Rosen. "The coming subscription services may now begin licensing thousands of musical works immediately. For consumers, this will essentially mean they will have access to more and better online music options, sooner."
The RIAA represents the interests of over 600 record companies including Universal, Warner, Sony, BMG and EMI. The agreement comes in the aftermath of a crusade by the music industry to clamp down on online piracy.
The record industry has been largely successful in launching legal attacks on file sharing organisations such as Napster, which was distributing copyrighted music without paying the relevant royalties.
"The Harry Fox Association stands ready to fulfil the licensing, collection and all operational aspects of this agreement," said president and chief executive Gary Churgin.
"This breakthrough in the licensing of music on the internet demonstrates the ability of the song writing and music publishing community and the record industry to achieve the right balance that benefits consumers as well as the entire music industry," he added.
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