Jaxsta Limited (ASX: JXT), owner of the world’s largest database of official music credits, has reached a landmark agreement with the global body Mechanical Licensing Collective (MLC).
MLC is a non-profit organisation established under the Music Modernization Act of 2018, created to issue blanket mechanical licences for qualified streaming services in the United States, such as Spotify, Apple Music, Amazon Music, and Tidal.
In 2022, the MLC paid out over US$700 million in royalties to songwriters and publishers in the first 18 months of operation.
This milestone contract was secured following a global tender process and extends from the recent successful implementation of our Recording Clustering Proof of Concept (PoC). The contract’s value to Jaxsta is indicative of the significant impact, opportunity and capability that Jaxsta continues to provide and demonstrate. It further strengthens our enterprise positioning, proving our business model in a robust and competitive environment. The use by the MLC validates Jaxsta’s value to royalty collection agencies that handle similar information in large volume like the MLC.
The contract includes an initial setup fee that is due within 30 days of the contract start to cover migration of the functionality developed for the PoC into a production environment, as well as establishing agreed data delivery mechanisms.
Furthermore, the tiered monthly pricing offers the MLC a dynamic, scalable solution for its requirements. The tiered monthly fee only applies to months in which the service is used.
Due to the variable use nature, the full value of this contract cannot be accurately determined at this time, but the company will update the market on the progress of this revenue stream as it materialises.
The contract commences immediately with the implementation of the production environment functionality and has no set end date.
Michael Stone will transition into a new role as Jaxsta Technical Director to oversee the project and ensure smooth delivery of the agreed services.
This contract with the MLC is a substantial testament to the quality of Jaxsta’s service – its cruciality to key facilitators of the music industry,” Jaxta CEO, Josh Simons, said.
“Partnering with the MLC further solidifies Jaxsta’s reputation as an enterprise solution provider and illustrates the direct applicability and scalability of our service and proprietary clustering technology. We believe this contract with the MLC symbolises a major step forward in our growth strategy and offers exciting opportunities for our shareholders.”