By Chris Castle

As you probably already know, the statutory mechanical royalty rate for physical or downloads (not streaming) has increased as of January 1, 2025. This means that all floating rate licenses (e.g., not subject to controlled comp rates) should have increased as of January 1, 2025 from 12.4¢ to 12.7¢ due to the Phonorecords IV cost of living adjustment. (And of course should have increased in prior PR IV years in 24.). And of course we have Trichordist readers to thank for helping to persuade the Copyright Royalty Judges to reject the Phonorecords IV frozen mechanical rate settlement that led to the labels agreeing to an increase from 9.1¢ to 12¢ plus a cost of living adjustment on physical and downloads that rose to 12.4¢ in 2024 and now to 12.7¢ in 2025. (But remember there is no cost of living adjustment for streaming mechanicals like Spotify.)

It’s probably just a glitch, but I understand that HFA hasn’t updated the 1/1/25 rates yet for “licensing out” in at least one instance (see screen capture below obtained this week). I’m inclined to believe that the issue is with the database and would not be a one-off, but I could be wrong. That suggests to me that every songwriter and publisher with either a newly issued license since 1/1/25 or a floating rate license in place during PR IV rate period (2023-2027) should probably confirm that the respective COLA escalations have been properly applied as of January 1 of 2024 and 2025. I would imagine that this isn’t an isolated incident, but maybe it is. No reason to let grass grow, however.

Here’s the Copyright Royalty Board’s timely notice of the new rate effective 1/1/25–which means that the HFA system does not appear to have been updated unless the screen capture reflects a one-off which seems doubtful to me.

And for reference, this is the rate for 2024 with the COLA adjustment that may also have been misapplied–everyone would have to check to know if it was misapplied to them.