December 23, 2009

By By Edith Honan, Reuters

The owners of about 1,200 local television stations have sued BMI, seeking for lower broadcast fees to reflect declining television viewership and advertising revenue.

The lawsuit, filed in U.S. District Court in Manhattan on Tuesday, demanded a "significant reduction" in fees as part of contract talks with Broadcast Music Inc.

The prior agreement expired in 2004 and since then the stations -- which include Tribune Co's WPIX-TV station in New York -- have been renegotiating the rates periodically. They now say a federal judge should set the rates.

A representative from BMI could not immediately be reached for comment.

Stations have been forced to "reduce budgets and contain costs across the board" and music performance fees "should not be exempt from the impact of current economic conditions," the lawsuit said.

"Fewer viewers are being exposed to any given musical work contained... [in] programming," it said.

BMI collects license fees on behalf of composers and music publishers for TV stations that use the compositions in commercials, shows and as background music.

Since the previous fee agreement was reached in 2002, TV viewership has fallen and ad revenues have slumped, with consumers turning to cable stations and other media.

The case is WPIX v. BMI, U.S. District Court, Southern District of New York, no. 09-10366.

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