Radio doesn’t pay performers, but iHeart will get $100M from BMI sale

[UPDATED] In an ironic twist, iHeart Media, the largest owner of broadcast radio stations in the US, will receive $100 million from the sale of BMI to New Mountain Capital. The windfall is a result of iHeartMedia’s equity interest in BMI.

The sting of a radio giant profiting from the sale of BMI to the tune of $100 million will be felt most acutely by the artists whose performances made the tens of thousands of songs that iHeartRadio stations play daily famous. Other radio and television broadcasters also owned stakes in BMI before selling to New Mountain.

As a Performing Rights Organization (PRO), BMI is charged with collecting royalties on behalf of its members. But four countries – the US, North Korea, Iran, and China – do not require broadcast radio to pay performance royalties.

BMI and other PROs do collect US radio royalties on behalf of songwriters and music publishers.

New Mountain Capital has announced that after the sale, $100 million in bonuses will be distributed to BMI’s 1.4 million members, which include songwriters and music publishers, but not performers.

MORE:

• BMI to pay Songwriters & Publishers $100M in bonuses after sale to New Mountain Capital
• BMI to raise cut it takes from songwriters, publishers from 10% to 15%

Bruce Houghton is the Founder and Editor of Hypebot, a Senior Advisor at Bandsintown, President of the Skyline Artists Agency, and a Berklee College Of Music professor.