TIDMSONG
RNS Number : 1697R
Hipgnosis Songs Fund Limited
04 July 2022
Hipgnosis Songs Fund Limited ("Hipgnosis" or the "Company")
Impact of Copyright Royalty Board III Decision
4 July 2022
The Board of Hipgnosis Songs Fund Limited, the first UK listed
investment company offering investors a pure-play exposure to songs
and associated intellectual property rights, and its Investment
Adviser, Hipgnosis Song Management Limited, welcome the decision of
the US Copyright Royalty Board (CRB) to disallow the appeal by
various streaming services against the CRB III determination to
increase mechanical streaming royalty rates for songwriters and
publishers.
The increase, which is incremental over the period covered by
CRB III (1 January 2018 until 31 December 2022) will culminate in a
44% uplift in the "all in" (mechanical and performance) statutory
minimum rates for streaming paid in the US, rising from 10.5% of
streaming revenues prior to 2018 to 15.1% in 2022.
Commenting on the decision, Merck Mercuriadis, Founder and CEO
of Hipgnosis Songs Management, said:
"Using the success of Hipgnosis to change where the songwriter
sits in the economic equation has been a massive priority for us
from day one.
"The song is the currency of our business, without the song we
simply have no music business. Yet for too long the songwriter -
who delivers the most important component to the success of a
record company, digital service provider, music merchandiser, live
promoter etc., is the lowest paid person in the equation.
"We still have plenty of room for improvement before we have a
rate that's genuinely fair and equitable but this is an important
step on the road to finally, properly recognising the value that
songwriters bring to the industry and the lives of the billions of
people all over the world who rely on great songs to enrich their
lives.
"The CRB has delivered a strong message not only to the digital
service providers like Spotify but also to the recorded music
companies about the importance of the songwriter in our
industry.
"Congratulations to all of the incredible songwriters that have
entrusted us with their incomparable songs as well as to each and
every songwriter that goes to work each day to write great songs
and make the world a better place. This is a victory for all of
you."
For most of the period since the appeal was launched in 2020,
the majority of the increased revenue due to the owner of song
copyrights has been withheld and revenues have been paid off the
CRB II rate of 10.5% in most cases. Hipgnosis will now receive US
streaming revenues based on the royalty rates set out in CRB
III.
In addition, Hipgnosis has not accounted for any withheld
revenue since 2020. This is expected to be received by Hipgnosis in
the coming periods, as money flows from the Digital Service
Providers (DSPs) to the publishers and then copyright owners.
We expect more details once the full ruling is released.
CRB IV, which will determine songwriter payments for 2023-27, is
currently underway.
For more information:
Hipgnosis Song Management
Merck Mercuriadis
Giles Croot (Media) +44 (0)20 4542 1511
Rufina Pavry (Investors ) +44 (0)20 4542 1530
Singer Capital Markets - Joint Corporate Tel: +44 (0)20 7496
Broker 3000
James Maxwell / James Moat / Amanda Gray
(Corporate Finance)
Alan Geeves / James Waterlow / Sam Greatrex
(Sales)
J.P. Morgan Cazenove - Joint Corporate Broker Tel: +44 (0)20 7742
William Simmonds / Jérémie Birnbaum 4000
(Corporate Finance)
James Bouverat (Sales)
RBC Capital Markets - Joint Corporate Broker Tel: +44 (0)20 7635
Elliot Thomas / Max Avison / Lauren Davies 4000
(Corporate Finance)
Lisa Tugwell (Sales)
Ocorian - Company Secretary & Administrator Tel: +44 (0) 28 9693
Lorna Zimny 0222
The Outside Organisation Tel: +44 (0)7711 081
Alan Edwards / Nick Caley 843
Tel: +44 (0)7771 978220;
FTI Consulting +44 (0)7809 411882;
Neil Doyle/ Paul Harris/ Laura Ewart +44 (0)7761 332646
All US music publicity enquiries Tel: +1 917 767 5255
Fran Defeo
Notes to Editors
About Hipgnosis Songs Fund
Hipgnosis, which was founded by Merck Mercuriadis, is a Guernsey
registered investment company established to offer investors a
pure-play exposure to songs and associated musical intellectual
property rights. The Company has raised a total of almost GBP1.3
billion (gross equity capital) through its Initial Public Offering
on 11 July 2018, and subsequent issues in April 2019, August 2019,
October 2019, July 2020, September 2020, February 2021 and July
2021. In September 2019, Hipgnosis transferred its entire issued
share capital to the Premium listing segment of the Official List
of the FCA and to the London Stock Exchange's Premium segment of
the Main Market, and in March 2020 became a constituent of the FTSE
250 Index. Since April 2021, the Company has been resident in the
UK for tax purposes and is recognised as an investment trust under
applicable HMRC regulations.
About Hipgnosis Song Management Limited
The Hipgnosis Songs Fund's Investment Adviser is Hipgnosis Song
Management Limited , which was founded by Merck Mercuriadis, former
manager of globally successful recording artists, such as Elton
John, Guns N' Roses, Morrissey, Iron Maiden and Beyoncé, and hit
songwriters such as Diane Warren, Justin Tranter and The-Dream, and
former CEO of The Sanctuary Group plc. The Investment Adviser has
assembled an Advisory Board of highly successful music industry
experts which include award winning members of the artist,
songwriter, publishing, legal, financial, recorded music and music
management communities, all with in-depth knowledge of music
publishing. Members of Hipgnosis Song Management Limited Advisory
Board include Nile Rodgers, The-Dream, Giorgio Tuinfort, Starrah,
David A. Stewart, Poo Bear, Bill Leibowitz, Ian Montone and Rodney
Jerkins.
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END
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