Music Groups Urge D.C. Lawmakers to Revamp Licensing Laws

Music Groups Urge D.C. Lawmakers to

Characterizing the current system as outdated as the heyday of vinyl records and 8-track tapes, representatives for musicians and music publishers called on Congress to overhaul laws governing how songwriters and others in the industry are compensated when their works are licensed.

The hearing on Tuesday before the House Subcommittee on Courts, Intellectual Property and the Internet highlighted the patchwork of regulations and compulsory licensing that the industry says has made it more and more difficult for songwriters to earn a living in the digital age.

“An American profession is in a lot of trouble. We are hurting,” said Lee Thomas Miller, songwriter and president of the Nashville Songwriters Assn. International.

Neil Portnow, president and CEO of the Recording Academy, called for a “music omnibus bill” that would cover “fair market pay, for all music creators, across all platforms.”

There are signs of movement on some of the issues.

Last week, the Department of Justice announced that it was reviewing 73-year-old consent decrees that dictate how music rights organizations ASCAP and BMI set rates for licensing songs. The decree was entered into in 1941 after the DOJ filed antitrust cases against the organizations. Michael O’Neill, the CEO of BMI, argued that songwriters and publishers should have the ability to make more of their own private agreements on the free market.

Meanwhile, legislation has been introduced in Congress to address what songwriters say are inequities in the system.

The Songwriter Equity Act, introduced last month, would change the way that the Copyright Royalty Board calculates how much songwriters are paid for song sales, tying it to “fair market” rates. The rate is now 9.1 cents per song sale. That is up from 2 cents — in 1909.

The RESPECT Act would  require digital services like Pandora and SiriusXM to pay artists and labels when they play recordings made before 1972. That is the year when sound recordings were placed under federal copyright.

And some lawmakers again are calling for a change in the law to require that broadcast radio stations pay artists when their songs are played over the air.

Broadcasters and streaming services oppose many provisions of the proposed legislation. Lee Knife, executive director of the Digital Music Assn., warned that a big problem is that the system was too opaque and inefficient. Streaming services “are paying hundreds of millions of dollars in royalties yet we still hear complaints that songwriters are not being compensated appropriately,” he said.

Others argued that the licensing business is still prone to abuse.

“It doesn’t take much of copyright aggregation to be in a monopoly position,” said Will Hoyt, executive director of the TV Music Licensing Committee.

Whether the legislation gets anywhere this year is another question, in a Congress where the best bet seems to be on nothing much getting done.  That may be even more the case with the midterms in the coming months, and after the stunning upset on Tuesday of House Majority Leader Eric Cantor (R-Va.) to a Tea Party-backed challenger.

Those urging action put it into the context of Congress taking steps to put more of the negotiations over music rights into the free market, and away from government regulation.

At the hearing, there also was a call for some kind of streamlined process for determining just who owns the rights to a song, an often complicated process that has left much music dormant.

“The best way to build transparency is to put us in a free market, because then you would have an incentive, if you want to license your copyright, for it to be known,” said David Israelite, president and CEO of the National Music Publishers Assn.

The House Judiciary Committee has scheduled another hearing on music licensing on June 25.

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    1. Video Vision says:

      Here’s a cautionary note for both Congress and the music industry to consider: At least as it affects the licensing of copyrighted music in old television programs, leaving the negotiation of synchronization rights up to the free market has only resulted in rates demanded by composers, their estates and publishers that are so prohibitively high as to essentially guarantee that distributors cannot make a profit on releasing vintage variety shows on DVD, thus preventing most of these gems from being reissued and consigning a huge part of television history to rot away in archival vaults.

      Adopting a similar free-market approach to the playing of music on radio and the Internet might well have similar consequences. Both industry and government should be careful what they wish for and codify into law.

      • Lman31 says:

        @ Video Vision I was using sarcasm!
        Having said that I am still siding with the PROs & as a music publisher believe me I am well aware with the state of affairs the FACTS ARE SONGWRITERS, COMPOSERS AND MUSIC PUBLISHERS DESERVE AND NEED TO BE PAID
        further more we should also be collecting mechanicals for said DVDs but are often forced to either waive them all together or negotiate some reduced rate or pass on the license all together

        • Video Vision says:

          @Lman31: If you’ll look carefully, you’ll see that nowhere in my original comment did I ever contend that composers should not be paid fairly for the use of their work. I simply cited one example of how a free-market approach to music clearances has stifled the re-release of one particular genre of content (specifically, vintage television series — especially variety shows), resulting not only in frustration for consumers of that product but an actual deprivation of revenue for composers and publishers due to the fact that in many instances, the price demanded for use of their compositions far and away exceeds any realistic possibility for distributors of the programs in question to recoup their costs.

          You refer to a mechanical license for collecting royalties from DVD sales, but unfortunately, no such system exists at present. If only it did, and operated in a way similar to mechanical licensing for audio recordings, there would be no problem, as there would be predetermined, affordable rates for DVD music clearances, as opposed to the wild-west free-market conditions that currently prevail.

          If you’d care to see how the latter conditions, as they now stand, adversely impact the DVD market for vintage television shows, I would commend you to the following widely-circulated and highly instructive article:

      • Lman31 says:

        @ Video Vision
        I vehemently disagree with you 100 %!! we have Copyright laws for a reason and composers,songwriters and publishers have been affected in many horribly negative ways and manners due to these out dated,outmoded consent decrees that are 73 years old!
        At stake here, is the lively hood and patrimony of many songwriters,composers and publishers whom need to and deserve to be properly & fairly compensated for ALL their works and efforts!

        Further more, the sync business is all ready way too infested and infected with individuals who have the balls and gal, (whether it’s due to sheer ignorance or down right corruption and malice) who believe that the should be able to clear all sides of a sync gratis,or $1.00 and for the exposure !

        I’ll tell you what! exposure is what songwriters,composers,and publishers are going to die of if they don’t get paid pay their rent/mortgage feed themselves and their families

        To add insult to injury,services such as spotify,you tube etc.. are not paying the song writers f**&* all
        especially spotify who has been heavily financially invested by the record labels

        So in closing, I must once again say I vehemently disagree with you and A FREE MARKET APPROACH IS EXACTLY AND UNDENIABLY WHAT WE NEED ( with the caveat that preventative anti trust,anti,corruption,anti,monopoly provisions accompany such amendments in order to guaranty A TRUE FREE MARKET

        Now, on your point regarding the distributors, NO BODY USES/BUYS DVDs any more !

        see my point? quite cold uncaring selfish and aloof yeah?

        • Lman31 says:

          @ Video Vision I was using sarcasm!
          Having said that I am still siding with the PROs & as a music publisher believe me I am well aware with the state of affairs the FACTS ARE SONGWRITERS, COMPOSERS AND MUSIC PUBLISHERS DESERVE AND NEED TO BE PAID
          further more we should also be collecting mechanicals for said DVDs but are often forced to either waive them all together or negotiate some reduced rate or pass on the license all together

        • Video Vision says:

          @Lman31: It might help make your points if you restrained yourself from introducing gratuitous invective into your arguments.

          As for your remark about NOBODY any longer buying or using DVDs, you couldn’t be more wrong, and if you regularly read Variety or any other trade publication, you would have seen, just within the last several days, a number of articles citing actual statistics (as opposed to your unsubstantiated claims) attesting to the fact that not only does the packaged media business remain robust, but also, that it continues to dominate the home video marketplace, with the public still prefering pressed discs to digital downloads by a substantial margin.

          Next time, perhaps you can try citing genuine facts, rather than engaging in ad hominem attacks, to bolster your contentions — not a single one of which you managed to substantiate herein.

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