The U.S. Copyright Royalty Board allows copyright royalty claimants to establish their own claimants’ groups, which are formed by claimants with similar programming interests (for example: religious broadcasters, public television, or professional team sports). After the groups negotiate and agree to settle or litigate their shares of the annual distribution before the Copyright Royalty Judges in an Allocation Phase proceeding, representatives for each claimant negotiate or litigate their individual portions of that amount in a Distribution Phase proceeding, unless settled in other ways. Currently, proceedings are grouped into four-year periods (for example: 2014-2017).
In simpler terms, copyright royalties are divided like pieces of a pie. First, each claimant group gets a slice. Then individual claimants in each group receive slivers of their group’s slice. Typical distribution formulas are based on average household television audience ratings for the programs shown on distant signals, the number of subscribers who actually receive those distant signals through their cable or satellite company, and/or perceived quantitative and qualitative analysis of a particular type of programming for viewers’ awareness, interest and demand. During each proceeding, this method of allocation is reviewed and at times renegotiated.