Billboard: The MLC’s Kris Ahrend on $1B in Payouts, ‘Illuminating’ Black Box Royalties & More

The MLC’s Kris Ahrend on $1B in Payouts, ‘Illuminating’ Black Box Royalties & More

The CEO also talks about the Copyright Royalty Board and what happens once a Phonorecords III ruling is finalized.

On Feb. 21, The Mechanical Licensing Collective (The MLC) announced to its members that it had hit an important new milestone roughly two years after launching — distributing $1 billion in royalties to music rights holders with a current match rate of over 89% for streaming data to a musical work in the MLC database for 2022.

The MLC is a Nashville-based non-profit which was established by the Music Modernization Act (2018) as the designated organization to collect and distribute mechanical royalties under a blanket license for streaming services. At the time, the industry was fraught with a growing pool of royalties from streaming services that were sitting unallocated because the composition’s owners could not be found. The creation of the MLC was designed in hopes of alleviating this issue.

The organization officially opened its doors Jan. 1, 2021 and since then, it has been tasked with not only collecting and distributing current mechanical royalties currently coming in but also trying to match that pool of $427 million in royalties from before its inception that never made it to its proper owners. So far, it has matched over $200 million of that $427 million pool. While some in the industry have nicknamed this pool of money “black box” royalties, The MLC prefers to use the term “historical unmatched royalties.”

To explain how The MLC reached its $1 billion milestone and to answer questions about how the Copyright Royalty Board’s Phonorecords III ruling will affect The MLC and when unmatched royalties will be divvied to rights holders based on market share, CEO Kris Ahrend gave an exclusive interview to Billboard.

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