NEW YORK, NY -- (MARKET WIRE) -- March 6, 2007 -- Boldly redefining and broadening the role of a
performing rights organization, ASCAP (American Society of Composers,
Authors and Publishers) today reported record revenues of $785 million and
royalty payments of $680 million for 2006, as well as an all-time low
operating expense ratio of 12.0 percent.
ASCAP attributes its stellar performance to multiple factors. These
include growing revenues from the licensing of existing and new music
channels, outstanding operational efficiency and the introduction of
numerous high value new services. These factors are helping to attract
record new members. In 2006, ASCAP welcomed 40,000 new members, more than
any other rights organization in the world.
Revenues for 2006 exceeded 2005 by $37 million, a 5 percent growth rate,
while royalty distributions increased by $34 million, or almost 5.3 percent
over the prior year. Both U.S. and foreign royalties showed strong gains,
with domestic distributions totaling over $486 million, up 6.3 percent, and
international distributions reaching $211.7 million.
"Our overarching priority each year is to put more money in the pockets of
our members -- hard working songwriters, composers, lyricists and music
publishers. That's a goal we clearly met in 2006," said John LoFrumento,
ASCAP CEO. "To continue achieving such results, we are investing in new
technologies that enable us to operate more efficiently and are
significantly broadening the scope of professional services we offer to
enhance the career opportunities of our members."
Contributing to the strong revenue growth was ASCAP's recently negotiated
licenses with both terrestrial and satellite radio. In 2006, total radio
revenues increased 11 percent to $22 million. Of that amount, terrestrial
radio revenues rose by $14 million, and satellite radio revenues rose by $8
million. ASCAP anticipates continued growth from satellite radio as a
result of a new five-year agreement with XM Satellite Radio that derives
revenues from both advertising and subscriber fees.
In television, ASCAP recently completed a new license agreement with ABC,
resulting in a significant increase in that network's fees. The
arrangement covers performances by ABC across the Internet, broadband and
wireless platforms, as well as video-on-demand, subscription
video-on-demand and pay-per-view.
Overall in 2006, revenues from Internet and wireless license agreements
grew more than 70 percent to $13.8 million. However, with the rapidly
expanding array of delivery systems and venues for performances of
music -- and with advertising dollars rapidly shifting to cable, the
Internet and wireless -- ASCAP is taking strong steps to establish
licensing terms with new media that ensure fair rates of pay for music
creators.
On February 28, 2007, ASCAP filed a cross-motion in the United States
District Court for the Southern District of New York, asking the Court to
confirm that all Internet transmissions of musical works to the public,
including digital streams and downloads, are public performances -- as the
United States Copyright Law requires and Congress has stated. The trial is
set to begin on May 21.
"We strongly believe that our members are entitled to be compensated for
all Internet transmissions of their music to the public -- including the
public performance that is an essential part of a music download," said
LoFrumento.
Beyond its growing revenue streams from licensing agreements, ASCAP has
introduced a host of services and initiatives designed to support and
advance the careers of music creators. These include:
-- MusicPro Insurance, which provides affordable instrument, studio and
tour coverage. Music Pro has achieved an annual growth rate of 42 percent.
-- Mediaguide, which tracks broadcast and Internet performances via
digital fingerprinting technology. Mediaguide not only satisfies ASCAP's
performance tracking needs, but also generates revenues from 150
independent labels and publishers that now subscribe to the service's
monthly reports.
-- A partnership with i-SAFE Inc., the worldwide leader in Internet
safety education, to conduct a national anti-piracy education program for
middle school students. No other rights organization has established or
deployed such a leadership initiative.
-- "I Create Music" EXPO, the only large-scale gathering expressly
designed for music creators to share their knowledge and experiences. The
first EXPO attracted over 1,900 people in April 2006, and the second annual
event is scheduled for April 19-21, 2007, in Los Angeles.
-- PREP (Performing Rights Enterprise Program), a sophisticated
technology platform that gives members online access to ASCAP's performance
and royalty distribution databases. Major components of PREP are now in
use, with other capabilities scheduled to go live by next year.
"Our record financial performance in 2006 validates our strategy of
redefining and broadening the role of ASCAP to include our traditional
functions -- performance tracking and royalty distribution -- as well as
our new capabilities -- professional services that empower the careers of
members," said LoFrumento. "As digital technology transforms the music
landscape, we believe ASCAP is uniquely positioned to serve the needs of
all music creators."
About ASCAP:
Established in 1914, ASCAP is the first and leading U.S. Performing Rights
Organization representing the world's largest repertory totaling over 8
million copyrighted musical works of every style and genre from more than
275,000 composer, lyricist and music publisher members. ASCAP has
representation arrangements with over 70 music rights organizations such
that the ASCAP repertory is represented in nearly every country around the
world. ASCAP protects the rights of its members and foreign affiliates by
licensing the public performances of their copyrighted works and
distributing royalties based upon surveyed performances. ASCAP is the only
American Performing Rights Organization owned and governed by its writer
and publisher members.
www.ascap.com
Contact Information: Press Contacts:
Pauline Stack
ASCAP
(212) 621-6278
pstack@ascap.com
Meredith Topalanchik
CooperKatz & Co.
(212) 455-8018
mtopalanchik@cooperkatz.com