XM chairman begrudgingly accepts higher royalties
At a financial analysts' conference this afternoon, the chairman of XM told BetaNews he's okay with the higher royalty rates his company and Sirius will have to pay, although in one other respect, he feels it's still not all that fair.
NEW YORK CITY (BetaNews) - The US Copyright Royalty Board made a "fair and balanced judgment" with regard to new performance royalties, XM Satellite Radio Chairman Gary Parsons told BetaNews this afternoon. By our estimates, both it and Sirius Satellite Radio -- its ongoing merger partner -- may pay as much as 375% of what it pays now in royalties to the SoundExchange organization, beginning with its 2007 annual payment.
But even though the final judgment wasn't a surprise to him, and in line with analysts' estimates, Parsons said he believes it's still unfair that terrestrial radio stations continue to be exempt from paying performance royalties, on the basis of their providing promotional value to music.
"We also believe we are an excellent promotional platform," he told us.
Congress is currently considering measures that would lift the current royalties exemption that terrestrial radio currently enjoys. Such measures are being promoted fiercely, with historic recording artists such as Judy Collins already appearing before Congress; though an equally fierce opposition is also forming, backed by the National Association of Broadcasters.
At a UBS analysts' conference here this afternoon, XM's Parsons also told the audience that while he continues to expect federal regulators to approve of the merger between his company and Sirius, he feels the Federal Communications Commission is dragging its feet on the matter.
He said he's warned his family in advance that he'll be in a bad humor over the holidays if regulators don't approve the merger by the end of the year, as he believes he's been promised.
He also told analysts that the sales mix for satellite radio sets is changing, as more units are being sold pre-installed in GM, Honda, and Hyundai vehicles, and fewer portable units are sold by percentage.