Today the new Copyright Royalty Board (CRB) ruling was released, announcing royalty rates that will impact music streaming services and the broader music ecosystem. Given how complicated all of this is, we thought an explainer would be useful.
What is the CRB?
The CRB is an administrative body at the Copyright Office comprised of three Copyright Royalty Judges who set statutory license rates for certain music services. If the rights-holders and music distributors that wish to publicly perform sound recordings are unable to negotiate a settlement agreement about royalty rates within three months, then the CRB process begins.
How does the CRB process work?
The process is similar to an administrative trial, with written statements and testimony, discovery, and hearings. It results in a ruling that sets rates for the next five years. Depending on the kind of music service being offered, the CRB applies different legal standards to set rates.
How are the rates set?
The two main standards are the “willing buyer/willing seller” standard and the “801(b) factors.”