MUSIC CONNECTS US

2016 Annual Report 3 Message from President 4 Message from CEO 6 The ASCAP Board 9 Advocacy 11 Innovation MISSION 13 Membership 14 Success WE ARE THE WORLD LEADER in performance royalties, advocacy and service for songwriters, composers 16 Celebration and music publishers. Our mission is to ensure that our music 17 Commitment creator members can thrive alongside the businesses who use 19 Communication our music, so that together, we can touch the lives of billions. 20 Licensing

ASCAP 2 2016 ANNUAL REPORT OME WOULD HAVE US Our work, our music, is overregulated believe that we are living in and undervalued in the modern music a divided world. That there marketplace due to outdated and are insurmountable barriers overreaching federal regulations that between us — race, religion, govern how we license our work. ideology, wealth, nationality We are working hard to improve the and who you choose to love. system. Each year we hold a “Stand with Songwriters, composers, lyricists Songwriters” Advocacy Day on Capitol Hill Sand publishers know the truth. We know and meet with policymakers on various that no matter who we are or where we points on the political spectrum to urge come from, we are not so different from them to support legislation that provides one another. We are all human and share reasonable, free market reforms for the new universal experiences. music economy. What we do, creating music — whether­ We also hold grassroots meetings we write songs, scores, symphonies, lyrics — around the country with legislators and speaks to our shared experience and what it ASCAP members from their districts. means to be human. Music connects us in a And we support our champions in A message way that no other art form can. As songwriters Congress through our PAC — the ASCAP from ASCAP and composers, our music connects what is Legislative Fund for the Arts. in our hearts to potentially millions of hearts Last year, ASCAP members held President and around the world. Music publishers create op­ more than 40 meetings with members of portunities for that music to thrive and endure. Congress and their staff to discuss our Chairman That’s a powerful thing. issues. In addition, we had the support As music creators, we hold that power of thousands of music creators who Paul Williams within us. Each one of us can do amazing attended the 2016 ASCAP “I Create things. As an organization of music Music” EXPO and joined our advocacy creators, ASCAP can do amazing things. campaign. Thousands more wrote to Because ASCAP connects our members to their representatives in support of the livelihoods, advocacy, community, support Songwriter Equity Act. and professional development to help them With a new Congress, a new grow their careers. administration and shifting political ASCAP is the only US performing rights priorities, we need to keep sending a loud organization owned and operated by and clear message that reforming the songwriters, composers and publishers. music licensing system matters to everyone The ASCAP Board of Directors is elected who loves music. by and from our membership and that is no ASCAP just experienced an small thing. That sets us apart. Combining incredibly successful year. Our strong unique perspectives and yes, even financial results matter for each and differences, we work together on common every songwriter, composer and music goals and make decisions that achieve publisher who depends on the important the best outcome for ALL of us — our work ASCAP does every day. I am both collective community. proud and grateful for ASCAP CEO Beth ASCAP exists to ensure that those of us Matthews and her exceptional team for who create music and those who use our continually improving our operations music can both benefit from this beautiful to grow royalties and support the partnership. Our democratic model, professional development of songwriters combined with a pioneering spirit and and composers. United with a truly relentless innovation, has withstood the dedicated and visionary Board of test of time and remains the best way going Directors, ASCAP is building a stronger forward to preserve the value of music future for all members, from those just and efficiently deliver to our customers starting out to those whose music is an incredible repertory that is unrivaled beloved around the world. around the world. As an organization of music creators, we are best at communicating to our leaders in Washington why reforming our music licensing system is so vital to both our nation’s well-being and to our economy.

ASCAP 3 2016 ANNUAL REPORT AM THRILLED TO REPORT THAT IN 2016 ASCAP ACHIEVED HISTORIC high financial results with record-breaking revenues of $1.059 billion. In a 5.6% increase over the previous year, we distributed $918 million to our 600,000 song- writer, composer and music publisher members. 2016 was the second year of our six-year strategic transformation plan to secure the future for ASCAP members in the rapidly changing music world. Revenues from ASCAP’s licensing efforts in the US alone grew nearly 6% in 2016 to $759 million, up $42.2 million over 2015, fueled primarily by a 41% increase in revenues from Iaudio streaming services as well as higher revenues from satellite radio and General Licens- ees, such as bars, clubs, restaurants, hotels, live concerts and more. Foreign revenues totaled $300 million, up $1.5 million year over year in US dollars. AS- CAP’s international revenues would have exceeded last year’s performance by $12.9 million A message had it not been for the strengthening US dollar which resulted in lower foreign exchange rates. from ASCAP Domestic distributions of $631 million from ASCAP-licensed and administered CEO Beth performances in the US grew nearly 10%, up $55.5 million over 2015. ASCAP operates on a not-for-profit basis and delivers 88 cents of every dollar Matthews collected back to members for performances of their music. With a 2016 operating expense ratio of 12%, ASCAP remains among the most efficient Performance Rights Organizations in the world, while transforming to stay ahead of massive changes in the music industry. ASCAP’s strategic investments to grow General Licensing revenues continue to pay off for members with a 7.2% annual growth rate over the past four years. ASCAP licensed over 18,000 new businesses in 2016 and also instituted a number of innovations

$45M TOTAL 2016 REVENUE Revenue Growth Increase $1,014 +4% $1,059 $ $298 +0.9% $300 1.059 $716 +6% $759 Foreign

2015 Amounts noted 2016 Domestic BILLION in $MM 2016 DOMESTIC LICENSING REVENUE $ 759 MILLION $42.2 million from 2015

ASCAP 4 2016 ANNUAL REPORT A message from ASCAP CEO Beth Matthews (continued)

Distribution $51M Growth Increase +5.6% $867 $918 $287 $294 -2%

$573 $631 +8% Foreign ¢ OF EVERY 88DOLLAR ASCAP COLLECTS goes back to our songwriter, composer Amounts noted and music publisher members as royalties 2015 2016 Domestic and in $MM Administered 2016 DOMESTIC LICENSING DISTRIBUTIONS $ MILLION 631$55.5 million from 2015 in General Licensing, such as greater automation in plans that give employees more control while reducing reporting to drive compliance and create efficiencies ASCAP’s future cost base. that reduced our cost of new license acquisitions over I am deeply grateful to work with ASCAP’s the last three years by 50%. visionary, committed and highly knowledgeable ASCAP’s record high revenues and distributions in Board of Directors. They continue to anticipate 2016 are a testament to the amazing repertory of music changes on the horizon­ and seek ways to maximize we are privileged to represent, and to our investment in opportu­nities for our members in an ever-evolving innovations that enable us to continue to grow revenues, landscape. I am also fortunate to have an executive leverage our scale and increase efficiencies in our leadership team with a wealth of experience from operations. ASCAP is committed to transforming and the music, digital and media­ sectors who have innovating to secure a healthy future for music creators transformed ASCAP into a modern, progressive and publishers. In 2016 alone, we processed over one organization that is built for growth, while trillion performances, welcomed 40,000 new members, continuing to be home to the world’s greatest and secured a steady stream of future royalties for music creators. our members by closing multi-year deals across major platforms, including satellite and terrestrial radio. ASCAP continues to strengthen its core operations. We entered into a new strategic and long-term data agreement with Nielsen to provide greater depth, transparency and reporting and tracking accuracy to members. ASCAP also modernized its employee benefits. We closed our outdated pension plan and moved towards smarter 401(k) and retirement savings

ASCAP 5 2016 ANNUAL REPORT

The ASCAP Board of Directors as of April 2017 The ASCAP Board of Directors as of April 2017 Hit songwriters Priscilla Renea and MoZella blow off a little steam after walking the halls on Capitol Hill

ADVOCACY In 2016, thousands T THE ASCAP “I CREATE Advocacy Day on Capitol Hill. The of ASCAP members MUSIC” EXPO IN APRIL, event featured a delegation of from across the 2016, more than 1,300 ASCAP members, including Brian country joined songwriters, composers, McKnight, Monica, Savan Kotecha, Aproducers and publishers emailed MoZella, Brett James, Priscilla Renea, their voices to help change the their representatives in support of the Jennifer Higdon, Khari “Needlz” Cain, narrative for music Songwriter Equity Act and signed their Randy Goodrum and ASCAP Board creator rights in names to #StandWithSongwriters members Desmond Child, Dan Foliart, Washington DC. petition guitars. Among the members Wayland Holyfield, Dean Kay, James who signed the guitars were Erica M. Kendrick, Leeds Levy, Irwin Z. Campbell, Pat Benatar, LaShawn Robinson, Alex Shapiro, Paul Williams Daniels, James Fauntleroy, Nate Ruess and Doug Wood, who walked the halls of fun., OMI and Adam Schlesinger. of Congress to meet policymakers A month later, on May 18, the guitars to urge them to update the WWII- made the journey to DC as part of era federal laws that regulate how ASCAP’s “Stand With Songwriters” songwriters license their works. They

ASCAP 9 2016 ANNUAL REPORT ADVOCACY

also advocated for passage of the bipartisan Songwriter Equity Act. The groups on the Hill met with more than 35 Congressional offices from across the musical spectrum. On “Stand With Songwriters” Advocacy Day, ASCAP debuted a new video featuring songwriter members delivering a personal appeal for music licensing reform Rep. Darrell Issa (R-CA) is pictured (holding guitar) with (l-r) ASCAP President Paul Williams, Randy Goodrum, ASCAP Board members Dean by highlighting a number of Kay and Wayland Holyfield, ASCAP CEO Beth Matthews, Brett James, Needlz, Brian McKnight (in back) and Savan Kotecha notable changes to American culture since the laws were written in 1941. Thanks to ASCAP’s advocacy leadership, by year’s end the Songwriter Equity Act had gained 40 co-sponsors in the House of Representatives and six in the Senate. In August, the Department of Justice made a decision to institute 100% licensing, provoking an Brian McKnight at outcry from all corners of the music We Write the Songs industry. ASCAP and BMI devised a joint strategy to most effectively address the DOJ’s proposal. ASCAP took the lead with respect to legislative efforts and BMI focused on a legal strategy. Throughout the summer and fall, we came together to host three town hall meetings for our respective members and associates in Los Angeles, Nashville and New York. Later, in October, Composer Jennifer Higdon ASCAP and BMI collaborated to at We Write the Songs hold both a House and Senate briefing for Congressional staffers on Capitol Hill.

Within a week of debuting in May 2016, ASCAP’s #StandWithSongwriters video received more than 30,000 views across ASCAP’s social media channels. The accompanying social media campaign yielded more than six million impressions of #StandWithSongwriters and two million impressions of #SongwriterEquityAct.

ASCAP 10 2016 ANNUAL REPORT INNOVATION In 2016, we gave members and licensees new tools, greater transparency and best-in-class digital experiences to make doing business effortless and efficient.

ASCAP continues to provide best-in-class digital and licensing partners to manage their catalogs and do experiences and new support services to members. In business with ASCAP, resulting in a 200% increase in 2016, we redesigned and relaunched a new website, member engagement. In addition, ASCAP entered into a new online Member Access portal and a more a new strategic data agreement with Nielsen to provide transparent repertory database. These digital product greater depth, transparency and reporting and tracking and service innovations made it easier for members accuracy to ASCAP members. ONE TRILLION performances processed by ASCAP in 2016

ASCAP 11 2016 ANNUAL REPORT INNOVATION

A NEW ACE A NEW STRATEGIC In 2016, ASCAP’S public ACE repertory database of DATA AGREEMENT over 10.5 million works was redesigned to include ACAP is committed to remaining flexible and ASCAP shares of licensed works, making it more nimble by pursuing partnerships with transparent, easier to search and a valuable tool for best-in-class service providers. Our new data licensees, music supervisors and members. agreement with Nielsen will enable ASCAP to leverage the music industry’s most trusted data A NEW DIGITAL TEAM to deliver enhanced reporting, business tools ASCAP continues to focus on creating a more and services to its members with increased efficient, transparent music marketplace, and in transparency and efficiency through ASCAP’s 2016 created a new Digital Team, who created relaunched Member Access portal. modernized, more intuitive ASCAP.com and Member Access experiences. Additionally, A NEW APPROACH TO they are developing new experiences, re- A MODERN WORK FORCE engineering existing processes and creating Our dedication to securing ASCAP’s future new partnerships that will transform the way financial stability includes strengthening core members and licensees interact with ASCAP. operations. In 2016, ASCAP modernized its employee benefits by closing its outdated A NEW ASCAP.COM pension plan and moving towards 401(k) and AND MEMBER ACCESS retirement savings plans that give employees In December, ASCAP relaunched its more control while reducing ASCAP’s future cost redesigned website and dedicated Member base. ASCAP also supports a work/life balance Access portal, providing members with a for our employees, and in 2016 began to provide unified online experience employees with 20 days paid parental leave for across desktops, mobile all new parents, as well as 20 days devices and other platforms paid leave to care for an immediate so that ASCAP members family member with a serious can easily conduct their illness. Among other new employee business globally, 24/7. programs, we launched “ASCAP Within the new Member Notes the Cause,” a volunteer Access, members have service opportunity allowing our improved self-service employees to give back to the options, more information community in New York City. at a glance, a simplified process for reporting performances, the ability to ASCAP employees volunteer with City Harvest in New York City as part contact ASCAP with a single of a new program called tap, and much more. “ASCAP Notes the Cause.”

ASCAP 12 2016 ANNUAL REPORT MEMBERSHIP ASCAP’s membership surpassed 600,000 professional songwriters, composers and publishers in 2016. Over 40,000 music creators chose ASCAP in 2016, joining some of the top names in music, who renewed their agreements with ASCAP into the future. Every single one of them is a valuable part of the ASCAP repertory - quite literally. The growing breadth and success of our membership means the ASCAP license is that much more essential to music users, which translates to higher licensing revenues and expanded royalty distributions - and, of course, more music for fans to enjoy.

Kelly Clarkson Max Martin Katy Perry

Paul McCartney Lionel Richie Skrillex

Timbaland Usher Hans Zimmer

ASCAP 13 2016 ANNUAL REPORT Hamilton wins 11 Tonys, including Best Musical and Best Original Score for ASCAP member Lin-Manuel Miranda, who also won a 2016 Pulitzer Prize. SUCCESS The industry loved ASCAP music as much as the fans, bestowing many of its highest honors on our members.

Justin Paul & Benj Pasek accept the Best Original Song Oscar for “City of Stars” from La La Land. The songwriting team also won the Golden Globe.

Greg Kurstin

accepts the Song of the Year Elvis Costello & Tom Petty Grammy for Adele’s “Hello.” He are inducted into the Songwriters Hall of also won Producer of the Year, Fame, along with ASCAP members Marvin Album of the Year and Record of Gaye and Chic’s Bernard Edwards the Year at the 2017 Grammys

Marc Anthony was named Person of the Year at the 2016 Latin Grammys.

14 14 ASCAP 2016 ANNUAL REPORT SUCCESS

PAUL “NINETEEN85” JEFFERIES Hot R&B/Hip-Hop Songwriter #1 Hot R&B/Hip-Hop Songs Producer “One Dance”, “Too Good” 14#1 on the year-end song charts

ASHLEY GORLEY #1 Hot Country Songwriter “American Country Love Song,” “You Should Be Here” 9 ASCAP members wrote TOP 10 SONGS on the Billboard Hot 100 year-end chart

DREW TAGGART (CHAINSMOKERS) #1 Hot Dance/Electronic Songwriter MATTHEW WEST #1 Hot Dance/Electronic Producer #1 Hot Christian Songwriter “Closer,” “Don’t Let Me Down” “Grace Wins,” “Mended”

ASCAP 15 2016 ANNUAL REPORT -Walk the Moon play their smash hit “Shut Up and Dance” at the ASCAP Pop Awards, after winning the ASCAP Vanguard Award.

CELEBRATION Our members had plenty to be proud of in 2016. We toasted their success and paid tribute to music icons in all genres at our annual award shows.

Q-Tip accepts the ASCAP Golden Note Award on behalf of A Tribe Called Quest at the ASCAP Rhythm & Soul Awards

ASCAP Christian Music Songwriter Artist of the Year Matthew West, Songwriter of the Year Ben Glover and David Garcia, who co-wrote Song of the Year “Flawless” with Glover

Kelsea Ballerini kicks off Salsa superstar Luis Enrique accepts the ASCAP Country Music the ASCAP Voice of Music Award at Awards with her hit “Love Me El Premio ASCAP Like You Mean It”

ASCAP 16 2016 ANNUAL REPORT COMMITMENT ASCAP's support for our members doesn’t end when they cash their royalty checks. We invest in our members’ long-term success and foster the hits of tomorrow, through high- profile song camps, workshops in multiple genres, showcases at major industry events like the Sundance Film Festival and SXSW and networking events across the country.

Green River Ordinance surrounded by adoring music lovers at the 2016 Sundance ASCAP Music Café

Jules Pegram records an original cue with a 60-piece orchestra during the 2016 ASCAP Film Scoring Workshop with Richard Bellis, one of three scoring workshops supported by ASCAP

LaShawn Daniels, Priscilla Renea, Audra Mae and Chris DeStefano At the ASCAP EXPO's Writers Jam 17 17 ASCAP 2016 ANNUAL REPORT COMMUNICATION Clear, effective communication with our members, licensing partners, legislators and music fans is central to ASCAP’s success.

rom the relaunched ASCAP.com and Member Access portal to our Inside Music newsletters and our social media channels, ASCAP information reaches our songwriter, composer and Fmusic publisher members in multiple ways, wherever they are. We ensure that members receive the most important news, announcements and “take action” advocacy alerts they need to improve their lives as professional music creators. In 2016, as part of a strategic initiative to change the conversation with our licensees, we continued to share helpful information with them about the strength of ASCAP’s repertory, new tools that make licensing more efficient and how the ASCAP license connects to their business success. This led to improved relationships, new agreements and fostered a healthy, cooperative partnership with some of our most important customers.

18 LICENSING Thanks to ASCAP’s continued commitment to innovation, strong partnership development and mutually beneficial licensing agreements, 2016 was another record-breaking year for ASCAP licensing.

WITH 2016’s record-breaking revenues of $1.059 billion, including domestic revenues of $759 million, up $42.2 million over 2015, it is clear that ASCAP’s new approach to our relationships with our licensing partners is paying off in a big way. Among the many highlights on the licensing front, we:

• Secured a five-year agreement with the commercial radio industry (RMLC) that provides for increases paid by radio stations to perform music by members via terrestrial, over-the-air broadcasts as well as certain digital transmissions, which enables ASCAP to stabilize and grow revenues for our members

• Reached a final 5-year agreement with SiriusXM Satellite Radio

• Licensed more than 18,000 new businesses on top of the more than 700,000 businesses ASCAP has already licensed

• Completed a new final license agreement with background music suppliers, including Mood Media

• Rolled out a new discount program with the California Restaurant Association, the first of many future partnerships between ASCAP and the restaurant K industry 18newly-licensed • Completed successful infringement litigation businesses added suits, resulting in additional money going to our members and further education to licensees about the in 2016 importance of licensing music

19 ASCAP 2016 ANNUAL REPORT CONNECTS YOU