Effective July 29, 2009, a U.S. Music Royalty Fee has been added to subscriber invoices. Details about the specific costs being passed through to subscribers in this U.S. Music Royalty Fee are provided below.

1. Why does SIRIUS XM pay music royalties?

1. Music royalty rights were established by Congress and are the product of the Copyright Act. Unlike terrestrial radio, both SIRIUS and XM are required to pay copyright music royalties to recording artists, musicians and recording companies who hold copyrights in sound recordings (the actual recording of a work). These royalties have risen dramatically as a result of a decision of the Copyright Royalty Board. Like terrestrial radio, SIRIUS and XM must also pay music publishers who hold copyrights in musical compositions (or the lyrics and music) through their collective organizations, ASCAP, BMI and SESAC. These fees have also risen since March 2007. Finally, SIRIUS and XM must also pay certain copyright owners to facilitate the recording of content on portable devices.

2. Who is the Copyright Royalty Board?

1. The Copyright Royalty Board consists of three Copyright Royalty Judges who determine rates and terms for statutory copyright licenses that are set forth in the Copyright Act. These administrative judges are appointed by the Librarian of Congress.

3. Who benefits from the U.S. Music Royalty Fee?

1. 100% of the U.S. Music Royalty Fee will be used to offset payments from SIRIUS and XM to the music industry.

4. How is the U.S. Music Royalty Fee calculated?

1. We are passing along the increases in our costs attributable to statutorily or contractually required payments to the music, recording and publishing industries for the performance of musical works and sound recordings or for device recording fees since March 20, 2007, the date on which we applied to the FCC to approve the merger.

5. Do all SIRIUS XM subscribers pay the same fee?

1. All subscribers who receive a given package containing music pay the same fee. We believe charging each SIRIUS XM subscriber the same fee most equitably apportions the increased fees to subscribers. Note: some packages, such as News, Sports and Talk contain little music and are not subject to the U.S. Music Royalty Fee.

6. How much is the U.S. Music Royalty Fee?

1. The fee is $1.98 a month on our base $12.95 subscriptions and $.97 for base plans that are eligible for a second radio discount. Your actual fee may vary depending upon the Package and Plan term you choose.

7. Will I have to pay the U.S. Music Royalty Fee on the free months I received for buying an annual plan?

1. No, free months do not incur any U.S. Music Royalty Fees.

8. When will I pay the U.S. Music Royalty fee?

1. For plans renewing after July 28, 2009, the fee will be automatically added to your next bill. There will be no change to your current plan and that plan will remain in effect without change until your next renewal date.

9. Is the U.S. Music Royalty Fee applied to activations and other fees?

1. No.

10. Do you anticipate further price increases or additional fees in the near future?

1. No. We are committed to providing our customers the best value for their entertainment dollar.

11. Is this fee consistent with SIRIUS XM’s merger commitment not to raise prices for three years?

1. Yes. This fee is consistent with our commitment not to raise the base price of specific service plans for three years after the merger. The FCC decision approving the merger between SIRIUS and XM permits the companies beginning July 29, 2009 to pass through to subscribers any increases in music royalties since March 20, 2007, the day the companies first asked the FCC to approve the merger. The U.S. Music Royalty Fee implements this FCC decision.

The FAQ page can also be viewed at http://www.sirius.com/usmusicroyalty

SUBSCRIPTION PLAN MONTHLY MRF

XM Everything plus Sirius Best Of                                      $1.98 Per Month

XM Everything plus Sirius Best Of (Family Friendly)             $1.83 per Month

Additional Radios (Multi Radio Discount Packages)             $.97 Per Month

Mostly Music                                                                    $1.53 Per Month

News Sports and Talk                                                         No Fee

Here is the official word from Sirius XM regarding the new price structure

From The Sirius Website:

We are offering subscribers, like you, a special opportunity. Act now and save up to $90.*
On March 11, 2009, the monthly rate for you SIRIUS Everything
discounted subscription will increase from $6.99 per month to $8.99 per
month upon renewal. You can lock in the current discounted monthly rate
of $6.99 by choosing a longer-term plan- but only if you act quickly.

And if you renew now, you can continue to listen on line for FREE for
the length of the term you choose. Effective March 11, 2009, online
listening will be upgraded to a higher quality digital audio and it
will no longer be free.

And XM:

On March 11, 2009, we will upgrade the online listening experience to
near CD-quality digital audio. Satellite radio subscriptions will no
longer include internet radio at no charge.*

If you renew your subscription now, you will continue
to get online listening for FREE for the length of your subscription.

This is your chance to keep listening online at no charge.
After March 11th premium online listening will cost $2.99** per month.

No mention of the $8.99 increase on XM’s website but they probably just forgot to add it.

So what does all of this mean for you?

If you already have a locked in rate you are good until that time expires or you can add additional time to you locked in rate right now.

If you pay month to month, you are out of luck so either sign up for a longer plan or start paying the monthly fee.

Or do as some others are doing and cancel. (See Poll Below this post)

According to the websites streaming will be higher quality (128Kbps) but no mention of all channels being offered, which will be a huge let down.

Everyone has until March 11th to decide so take your time.

Would love to hear what people think about this?

Leave a comment below.

Starting On march 1st the multi receiver radio is no longer going to be 6.99 the new price is 8.99 so we are only saving 30%.
Also there is no longer going to be any free online listening. the only ppl that will get it for free are the lifetime subscribers. Everyone else has to pay 2.99 unless they have mostly music or the family pack then it is 8.99 everyone will be getting emails starting Jan 26th ffor the sale that will be going on. You can purchase a 3 yr plan to lock in the multi receiver rate with the 6.99 price.

The above comes from a forum member “ken.muise”. Now anyone can post on a web forum so I’m not believing this until Sirius XM gives the official word.

According to Orbitcast.com their own sources have confirmed this information and also added

According to a person familiar with the matter, the Mostly Music/News subscription package will be increasing in price to $12.95/month, while the A La Carte package is said to be increasing in price though our source is unsure exactly to what extent.

This person did confirm that Online Listening will cost $2.99 additional, and that multiple radios will increase to $8.99 a month. Adding further weight to the report on DRC.

Current subscribers will be given a chance to lock-in their rates, according to these people. You can choose to lock in the Online Listening or $6.99 multiple radio price. Notifications to subscribers are said to start going out on January 26th, and subscribers are rumored to have a chance to lock in their rates by March 11th.

Interesting to note any price increase to the A La Carte or Music/News is most likely a violation of the merger agreement with the FCC.

I will keep everyone posted but this is most likely solid for the Online Streaming, still rumor for the other information.

If Sirius XM starts charging extra for online streaming will you cancel service? If they start charging will we be able to stream in a higher bitrate?

If I’m getting charged for online listening I would like better audio quality and all channels available. If not there are many other free options out there to turn to.

More later.

Update:

Confirmed: Online listening will be raised from FREE to $2.99 a month and additional radios will increase to $8.99 a month.

Now the big question is will we gain anything by paying an additional $2.99 a month for online streaming?

I’m not thrilled about this and I’m not sure that the things said before the merger by Mel are true anymore.

What ever happened to our prices remaining the same after the merger?

I would love to hear other people’s thoughts on this.