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Senators Seek to Streamline Music Licensing, Boost Payments to Songwriters

WASHINGTON — A group of senators introduced legislation on Wednesday to streamline the music licensing process and to increase royalty payments to rights holders.

Sen. Orrin Hatch (R-Utah), Sen. Lamar Alexander (R-Tenn.), Sen. Sheldon Whitehouse (D-R.I.), and five others wrote a bill similar to one introduced in the House last month.

The Music Modernization Act updates music licensing laws to make it easier for songwriters to get paid when their music is streamed or purchased online. Songwriters have been seeking legislative changes for years, pointing out that they have not been receiving fair market value for their works on digital platforms like Spotify and Pandora.

“Our music licensing laws are convoluted, out-of-date, and don’t reward songwriters fairly for their work,” said Hatch, who is a songwriter himself. “They’ve also failed to keep up with recent, rapid changes in how Americans purchase and listen to music.”

Alexander said the legislation is “the first major bill that has the support of music creators, publishers, and digital music companies. With such broad support, I’m hopeful we will be able to pass the legislation this spring.”

Also sponsoring the legislation is Sen. Chris Coons (D-Del.), Sen. Bob Corker (R-Tenn.), Sen. Dick Durbin (D-Ill.), Sen. Johnny Isakson (R-Ga.), Sen. Doug Jones (D-Ala.), Sen. Sheldon Whitehouse (D-R.I.), and Sen. Kamala Harris (D-Calif.)

The changes in the bill include:

  • In a new standard, mechanical royalty rates will be based on what a willing buyer and a willing seller would negotiate in a free market.
  • A single entity will be created to grant blanket licenses for all musical works to digital media companies, and the entity will collect royalties for distribution to copyright holders. Digital music companies will pay the operation costs of the entity, but will also be shielded from liability for statutory damages. Digital music companies and copyright owners will still be able to enter their own voluntary license agreements.
  • Rate courts will be able to consider sound recording performance royalty rates when determining musical work performance royalties for digital services.
  • ASCAP and BMI are now subject to the same two judges presiding over the rate courts that decide songwriter compensation. Under the legislation, each new rate-setting case would be randomly assigned to a federal judge consistent with other federal litigation.

Elizabeth Matthews, the CEO of ASCAP, said the legislation makes changes “that better reflect the evolution of how people listen to music.”

“While there is more work to be done to ensure that songwriters earn fair compensation, this legislation, like the similar bill recently introduced in the House, represents important progress in an ongoing effort on industry-wide reforms that protect the rights of music creators,” she said.

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