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Senate Passes Music Modernization Act

UPDATED: After a long and complicated journey, the Senate passed the Music Modernization Act today by unanimous consent, paving the way for improved royalty payments to songwriters, artists and creatives in the digital era. Next, the bill returns to the House for approval of the Senate version, then it will go before President Trump to be signed into law.

The House bill passed unanimously in April and a similar Senate bill was introduced in May, but met opposition (or at least complications) from SESAC and satellite radio giant SiriusXM — dozens of artists and executives, including Paul McCartney, Don Henley and Katy Perry, on Monday issued a letter criticizing SiriusXM’s objections to portions of the bill. Sources say that two senators were aligned with SiriusXM on matters outlined in a statement the company issued in response to the artists’ and executives’ letter, one provision of which was a proposed guarantee that record labels share with artists 50% of the royalties for pre-1972 recordings that SiriusXM licenses.

There was no small amount of urgency for the music industry in moving the bill forward: With midterm elections just weeks away and Congress roiled by the confirmation proceedings around Supreme Court nominee Brett Kavanaugh, there was a very real possibility that, if the bill were not approved by the Senate now, the entire process would have to be done over with a new Congress. Via a procedure called “hotlining,” a bill can move forward quickly if it receives unanimous support — which is why those two senators’ support was key.

Sources tell Variety that a last-minute deal was struck on Tuesday between SiriusXM, the National Music Publishers Association and the Recording Industry Association of America, brokered through Global Music Rights chief Irving Azoff, that led to the unanimous vote. While SiriusXM did not succeed in resolving one of its major and longstanding issues — that terrestrial radio does not pay performers or sound-recording royalties for the broadcast of their music, although it does pay songwriters and publishers — it did secure an amendment that guarantees artists will be paid 50% of the monies SiriusXM pays to labels for pre-1972 sound recordings, which were not covered by federal law. (After a two-year legal battle, in 2015 SiriusXM agreed to pay record labels $235 million in royalties for the use of those recordings.)

With those and other exceptions, the industry overwhelmingly supported the bill Sen. Orrin Hatch (R-UT) called “crucially important” earlier this year, stating, “our music licensing laws are convoluted, out-of-date, and don’t reward songwriters fairly for their work. They’ve also failed to keep up with recent, rapid changes in how Americans purchase and listen to music.”

As in the House, the Senate bill combines three separate pieces of legislation:

– The Music Modernization Act of 2018, S.2334, introduced by Hatch and Senator Lamar Alexander (R-TN) in January, which updates licensing and royalties as pertains to streaming.

– The CLASSICS Act (or Compensating Legacy Artists for their Songs, Service, & Important Contributions to Society Act), introduced in February by Chris Coons (D-DE) and John Kennedy (R-LA) to ensure that songwriters and artists receive royalties on pre-1972 songs.

– The AMP Act  (or Allocation for Music Producers Act), introduced in March by Senate Judiciary Committee Chairman Chuck Grassley(R-LA) and ranking committee member Dianne Feinstein (D-CA.) with the support of and Senators Bob Corker (R-TN) and Kamala Harris (D-CA).

National Music Publishers Association president/CEO David Israelite said: “Today is a momentous day for songwriters, artists, composers, producers, engineers and the entire industry that revolves around them. The Senate vote marks a true step forward towards fairness for the people at the heart of music who have long been undervalued due to outdated laws. This was a long and complex process but ultimately the music industry has come out stronger and more united than ever. We commend Senators Orrin Hatch, Lamar Alexander, Chuck Grassley and Senate Leadership for swiftly moving this bill to the floor. Now we anxiously await the House’s final approval of the MMA and seeing it signed into law.”

ASCAP CEO Elizabeth Matthews said: “Today’s unanimous passage of the Music Modernization Act in the Senate represents a Herculean industry-wide effort to promote and celebrate songwriters and ensure their right to a sustainable livelihood. We applaud Senators Hatch, Alexander, Grassley, Feinstein, Whitehouse, Coons and the entire Senate for recognizing the value music has in both society and our hearts.”

Mike O’Neill, President & CEO of BMI, said: “The Senate’s unanimous passage of The Music Modernization Act is a monumental step forward in getting this critical piece of legislation signed in to law. This bill has been the product of unprecedented collaboration across the entire industry, and we thank Senators Hatch, Alexander, Grassley, Feinstein, Whitehouse, Coons, and the entire Senate, for helping to ensure that songwriters and composers can continue to earn a living creating the music that is loved all over the world.”

Martin Bandier, Chairman and CEO of Sony/ATV Music Publishing, said: “The unanimous backing of the MMA by the U.S. Senate shows what can be achieved when a diverse group of parties puts aside its differences and works together for the music industry’s greater good. This is a significant victory for all rights holders and we are confident that once the bill goes back to the House it will pass and become law shortly. It will go a long way to ensuring that songwriters and music publishers will be fairly compensated for their contribution to the streaming revolution, which has transformed music into a growth industry once again.”

Mitch Glazier, President, Recording Industry Association of America (RIAA) said: “As legendary band the Grateful Dead once said in an iconic pre-1972 song, ‘what a long strange trip it’s been.’  It’s been an epic odyssey, and we’re thrilled to almost be at our destination.

“For the modern U.S. Senate to unanimously pass a 185-page bill is a herculean feat, only achievable because of the grit, determination and mobilization of thousands of music creators across the nation.  The result is a bill that moves us toward a modern music licensing landscape better founded on fair market rates and fair pay for all.  At long last, a brighter tomorrow for both past and future generations of music creators is nearly upon us. We are indebted to the leadership of Senators Hatch, Grassley, Feinstein, Alexander, Coons, Kennedy and Whitehouse for helping get us there.”

SoundExchange CEO Michael Huppe said: “The future of the music industry got brighter today. Creators of music moved one step closer to getting paid more fairly. And industry forces that fought to maintain an unfair and harmful status quo were rebuffed. Now, SoundExchange’s 170,000-member community has just one word for the House of Representatives: Encore.”

Greg Maffei, President and CEO of SiriusXM owner Liberty Media stated, “We are pleased to join with the music community in sponsoring amendments that protect artists in this legislation.  It is important that the music industry move forward so that artists can showcase their work throughout the United States.”

Irving Azoff, founder of Azoff Music Management and Global Music Rights, said, “This is a monumental occasion for artists and songwriters who are now assured – in law – that they will receive their deserved royalties.  We are proud to be a part of this critical consensus and the ongoing fight for artists’ rights.”

Chris Israel, musicFIRST’s Executive Director, said: “After passing unanimously in the House of Representatives earlier this year, the musicFIRST Coalition is thrilled to see the Senate follow suit with unanimous passage of the Orrin G. Hatch Music Modernization Act. We thank U.S. Senators Orrin Hatch, Sheldon Whitehouse, Lamar Alexander, Chris Coons, Charles Grassley, Dianne Feinstein and John Kennedy, as well the over 70 other cosponsors for spearheading this historic legislation. We also thank the entire music industry – artists, songwriters, record labels, publishers, technology companies, and more – for their years-long commitment to come to a solution that all parties could enthusiastically stand behind.”

Chris Harrison, CEO of the Digital Media Association, said: “Today the Senate passed the Orrin G. Hatch Music Modernization Act by unanimous consent. This milestone for the MMA demonstrates that with bipartisan leadership and a united music industry looking to the future, consumers, creators and copyright owners can all benefit. The MMA is a groundbreaking piece of legislation that will streamline royalty payments and bring some much-needed transparency to the system. DiMA wishes to thank Senators Orrin Hatch (R-UT), Sheldon Whitehouse (D-RI), Chuck Grassley (R-IA), Dianne Feinstein (D-CA), Lamar Alexander (R-TN), Chris Coons (D-DE), Mike Lee (R-UT), Ron Wyden (R-OR), Ted Cruz (R-TX), and John Kennedy (R-LA) for their dedicated work in steering the MMA to passage in the Senate.”

A2IM CEO Richard James Burgess said: “The passing of the MMA bill is yet another example of what can be achieved when creators and their representatives stand together for fairer remuneration. A2IM is grateful to all the people involved in finally making this a part of our music industry reality. All creators should be compensated fairly and A2IM is a strong advocate to ensure that happens not only for independent artists and labels, but for all music creators and the businesses that support them. We look forward to the bill becoming a law, and giving all music creators what they have deserved for so long.”

NMPA Board Chairman Irwin Robinson added: “The Senate’s passage of the Music Modernization Act is the most exciting development I’ve seen in my career. Songwriters have suffered long enough and this bill will allow them to be paid fairly by the streaming companies that rely on their work. We got to this point because of the advocacy of hundreds of music creators who rallied behind the MMA and who will drive the future of the music industry. I look forward to seeing the MMA become law and watching the songwriters, composers, artists and producers who will greatly benefit.”

Paul Williams, songwriter, ASCAP Chairman of the Board and President, said: “American songwriters work tirelessly behind the scenes to create the music that fans all over the world enjoy. Today, we made history by joining together and working for Senate passage of the Music Modernization Act, bringing us one step closer to a music licensing framework that reflects how people listen to music today. We urge the House of Representatives to swiftly pass the Senate bill, so the President can sign it into law and music creators can begin to see the benefits of this critical reform.”

Songwriters of North America (SONA) Michelle Lewis and Kay Hanley “would like to thank Senators Hatch, Alexander, Whitehouse, Durbin and all the other Senate co-sponsors for passing Orrin G Hatch Music Modernization Act in the US Senate today.  SONA is proud to have worked along side of our entire music industry community on this historical legislation. We look forward to it finally becoming law and will continue to working with all our fellow stakeholders to ensure its effective implementation.”

Neil Portnow, President/CEO of the Recording Academy, said: “The passage of the Music Modernization Act by the Senate is a historic moment for the tens of thousands of music creators across the nation. Since first proposing the music industry unite around a common bill in 2014, our members have lobbied in Washington and all 50 states to achieve this vision. When creators raise their voices for fairness, they make great progress.”

Dina LaPolt, attorney for NMPA said: “I am ecstatic over the passing of the Orrin G. Hatch Music Modernization Act through the U.S. Senate today. After five years of collaboration and helping to bring people together from all parts of the music business, we have finally harmonized as an industry. This is a historic occasion for the music industry, copyright reform, and marks the beginning of a new era for music creators in consensus with stakeholders industry-wide.”

Michael Eames, President of the Association of Independent Music Publishers (AIMP), along with Alisa Coleman, AIMP New York Executive Director and John Ozier, AIMP Nashville Executive Director, issued the following statement: “The AIMP applauds today’s unanimous passage of the appropriately named Orrin G. Hatch Music Modernization Act in the U.S. Senate, clearing the path for its much-needed reforms to become law once ratified in the House and signed by the President. With support from both sides of the political aisle, along with unprecedented cooperation between the music and technology industry, the MMA will be a massive step forward for the independent publishing community and the music industry in general, which has been hamstrung by antiquated copyright laws for far too long. Now, independent publishers and songwriters will enjoy a more modern and realistic rate standard, a central public database to ease royalty payments from digital services, the end of evidence limitations placed on rights-holders arguing for more accurate royalty rates, the ability for PROs to be heard by more than just the same two judges, and a clear and final determination that digital services must pay for the use of pre-1972 recordings. None of this would be possible without NMPA President & CEO David Israelite and his staff, who have been instrumental in crafting and passing the MMA, and the AIMP thanks them along with Sen. Lamar Alexander for his articulate explanation of why this legislation is so important, and every U.S. Senator who has recognized the rights of independent publishers and songwriters by passing this legislation.”

Kevin Erickson, director of Future of Music Coalition, said: “Today’s unanimous vote is an important milestone for musicians and songwriters, not just because they will benefit from these changes, but because working together, we’ve proven that common-sense progress is possible on copyright issues. The involvement of creators representing many facets of the industry was undeniably crucial to this victory, and so as we look to the many legislative battles ahead, we know we’ll have the greatest success by staying focused on the needs of diverse artists and composers.”

SAG-AFTRA President Gabrielle Carteris said: “The Senate’s passage of the Music Modernization Act ensures that our singers and sound recording artists will at last be justly compensated for their pre-1972 works on digital and satellite platforms. We thank the Republicans and Democrats who together voted to correct this injustice and move the music industry forward. This is a great day for all the artists and creators whose work has and will continue to bring joy to millions of people across the globe. I’d also like to thank SAG-AFTRA members for their thousands of emails to Congress. Their voices were heard. We now urge the House of Representatives to pass the Senate bill quickly and look forward to the president signing this important legislation into law.”

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