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SiriusXM Responds to Artists’ Letter Threatening Boycott

Paul McCartney, Don Henley, Katy Perry and Pink were among the stars to criticize the satellite radio giant for potentially stalling the Music Modernization Act.

In a letter published by Variety on Monday, some 150 artists and executives, including Paul McCartney, Don Henley, Carole King, Katy Perry, Pink, Sia and hitmaker Max Martin, threatened to boycott Liberty Media, corporate parent to SiriusXM, over its opposition to the Music Modernization Act, which is thisclose to passing in the Senate. Specifically: SiriusXM has raised objections to portions of the bill, which aims to protect recordings released before 1972 from falling out of copyright protection, including the exclusion of terrestrial radio from mandatory payouts to rights holders. (Read the artists’ letter in full here.)

SiriusXM’s response to the letter follows in full below:

Over the past several weeks, we have been the subject of some stinging attacks from the music community and artists regarding our views on the Music Modernization Act.  Contrary to new reports and letters, this is really not about a SiriusXM victory, but implementing some simple, reasonable and straightforward amendments to MMA.  There is nothing in our “asks” that gut the MMA or kills the Act.  So let’s talk about the substance of the amendments we propose, because we truly do not understand the objections or why these concepts have incited such a holy war.

Contrary to the accusations, SiriusXM has proposed three simple amendments to the MMA.

First, SiriusXM has asked that the CLASSICS Act recognize that it has already licensed all of the pre-1972 works it uses.  This amendment would ensure that artists – the people who are supposed to be at the heart of the MMA – receive 50% of the monies under those existing licenses. Is that unfair? Just today, Neil Diamond wrote in the LA Times that: “I receive a small amount of songwriting royalties, but no royalties as the recording artist.” How can that happen? To date, SiriusXM has paid nearly $250 million dollars in pre-‘72 royalties to the record labels.  We want to make sure that a fair share of the monies we have paid, and will pay, under these licenses gets to performers.  Without this provision, artists may never see any of the money SiriusXM paid, and will pay, for the use of pre-1972 works.  Artists not getting paid hurts our business!

Second, Sirius XM thinks that the fair standard to use in rate setting proceedings is the standard that Congress chose in 1995 and confirmed again in 1998 – which is called the 801(b) standard. However, we are willing to move the “willing buyer/willing seller” standard contained in the MMA.  In exchange, we have asked for the same concession that the MMA grants to other digital music services, but we were left out of — simply that the rates that were set last year for five years now apply for ten years.  We thought this was a fair compromise when we read the “new” MMA that was released this weekend by the Senate, and are willing to live by that compromise.

Third, SiriusXM is asking the simple question: “Why are we changing the rate court evidence standard for musical compositions in this legislation so that it gives another advantage to broadcasters over satellite radio and streaming services?”  There is no policy rationale for this change to tilt the playing field further in their favor, and frankly no one has been able to explain it to us.  It is only fair that we debate why the change to Section 114(i) is in the MMA.

So that is the sum total of our changes.  There is nothing hidden or underhanded in our views. We have offered these simple amendments on a one-pager.  We are prepared to work with the NMPA and RIAA to adopt these amendments, pass the MMA, and move the music industry forward.

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