Rumors continue to swirl surrounding BMI’s supposed flirtation with a sale to private equity firm New Mountain Capital, and songwriters are concerned.
Following reports that a source close to the situation revealed to Billboard that performing rights organization Broadcast Music Inc. (BMI) was in talks to sell itself to private equity firm New Mountain Capital, rumors continue to surface over whether the deal will close. If true, the supposed price tag for the transaction is a whopping $1.7 billion.
While this isn’t the first rumor surrounding BMI since the organization shifted from a not-for-profit to a for-profit company last year and offered itself for sale, the uncertainty of its fate has sparked concern among songwriters and publishers.
Music industry organizations, including the Black Music Artists Coalition, the Artist Rights Alliance, the Music Artists Coalition, SAG-AFTRA, and Songwriters of North America, wrote a letter to BMI last week expressing their collective concern over the impact the company’s new profit-driven approach might have on songwriter payments.
“Songwriters have a vested interest in changes at BMI and in any proposed transaction which is wholly dependent on songs they have written,” the letter reads. “BMI does not own copyrights or other assets; it is a licensing entity for copyrights owned by songwriters and, by extension, publishers. Songwriters have a right to understand these decisions and how (they impact) us.”
“Will the broadcasters on BMI’s Board receive the sale proceeds? If so, why should broadcasters be the biggest beneficiary from a sale of a company whose only asset is songs that belong to songwriters?” the letter continues. “If broadcasters benefit from the sale of BMI, aren’t they essentially receiving a rebate on the licensing fees they’ve paid? In other words, they got to play songs for free.”
To assuage concerns, BMI President Mike O’Neill has emphasized a commitment to prioritizing songwriters’ interests and financial success, citing upgrades to BMI’s services portal and similar initiatives enabled by the shift to a for-profit model.
Meanwhile, Jody Gerson, CEO and Chair of Universal Music Publishing Group, tells Music Business Worldwide: “We don’t comment on rumor or speculations, but to be very clear, we will only support changes that increase value for songwriters and will not stand for any that result in our songwriters being paid less than what they deserve. We have a long history of successfully fighting for our songwriters and will continue to do so.”