Benom Plumb, Assistant Professor of Music Industry Studies at the University of Colorado Denver, reviews the biggest stories of the week affecting music royalties. He is a music industry professional, not an attorney.
Benom’s Take: I’ve been expecting the copyright reform issue to surface again soon as we head into 2018 and mid-term elections. The linked article is a very detailed legal analysis of the potential impacts of current copyright amendment bills moving through Congress. Unless you’re familiar with copyright verbiage and the process of Congressional bill passing, the article may be hard to follow. I will attempt to summarize and breakdown the analysis for the layman.
The author, Chris Castle, is a brilliant music industry attorney whom I’ve had the pleasure of hearing speak on music industry copyright issues several times. In the article, Castle warns of a suspected push toward an “omnibus” bill of Copyright Act amendments in 2018 ahead of mid-term elections. The “omnibus” bill essentially means a combining of the various bills into one big bill.
As Castle states: “Omnibus bills are a bad idea for songwriters and artists, particularly independent songwriters and artists, because omnibus bills tend to bring together Corporate America in attack formation.”
Castle’s point is that by combining these potential amendments, it brings high-profile attention and high-profile lobbying efforts by Corporate America against the music industry. Corporate America and “Big Tech” companies that license and pay music royalties see “omnibus bills” as an opportunity to further restrain copyright and royalty payouts. They have a very powerful lobby and have greatly benefited from antiquated copyright laws on the music industry.
For example, the World War II-era consent decree on ASCAP and BMI was designed to protect small businesses from the power and “monopolies” of ASCAP and BMI. This is no longer the market or world we live in. Today, the Google’s and Spotify’s of the world are clearly more powerful and have more money than ASCAP and BMI. If anything, the tables have turned, and some argue that the music industry in fact needs protection from the “Big Tech” monopolies. Many feel consent decrees have reduced competition and lowered royalties.
The bills that Castle refers to are the CLASSICS Act, Fair Pay Fair Play Act, PROMOTE Act, and Transparency in Music Licensing Act. Essentially, each one impacts royalties for sound recordings and/or musical compositions. So basically, the entire music industry.
I could see how CLASSICS, Fair Pay Fair Play and PROMOTE Acts could be rolled into one amendment, since they all have similar agendas focused on sound recordings. The CLASSICS Act would start paying royalties on sound recordings made before 1972, since there is currently no Federal copyright protection for sound recordings made before February 15, 1972. Before that date, the sound recordings are only protected under state law.
Both Fair Pay Fair Play and PROMOTE seek to close the loophole by creating a FM/AM terrestrial broadcast radio royalty for sound recordings. Virtually every developed country in the world has this royalty for sound recordings except the U.S., China, Iran, North Korea and Rwanda. Here’s what President George W. Bush said when asked about this copyright issue in a Town Hall meeting in 2007.
While the Transparency in Music Licensing Act has very good intention--because some kind of central licensing database would be very helpful in today’s market to increase licensing/payment efficiency and correct royalty data and contact information of payees--there are concerns about its execution. The problem with this bill, as Castle states, is the penalty for a creator not signing up for the database or providing incorrect data.
If a creator chooses not to participate or mistakenly provides incorrect copyright split data, this bill would essentially strip away all recourse a copyright owner has if their song is infringed upon. Faulty copyright split and claimant data happens all the time, and 9 times out of 10 it’s not malicious. Nevertheless, I still believe the intention of this bill is good, but that it is better suited placed under a totally new Copyright Act.
(ASCAP and BMI have announced they are collaborating to create a joint musical works database, probably in the hopes that if they create their own central database, the government won’t step in and try to create one for the music industry.)
Even though Castle has a valid point about the negative impacts of “omnibus bills,” my hope is that we won’t have a continuous piecemeal copyright reform debate consisting of a little amendment here / a little amendment there. I’d like to see a new Copyright Act altogether.
How else do we address antiqued laws and concepts currently governed by the old Copyright Acts? The register of copyrights once said that the 1976 Copyright Act “was a good 1950’s Copyright Act.” Even then it was recognized as behind the times, and, we’re still governed by it today!
And now for this week’s other headlines:
- Neilsen 3rd Quarter Report Shows 40% Jump In On-Demand Streaming (Billboard)
- Spotify Names New Global Head of Publisher Licensing (Variety)
- On Eve of ‘Blurred Lines’ Appeal Hearing, Richard Busch is Music Industry’s Most Feared Lawyer (Billboard)
- Executive Shake-Up at Warner Bros. Music (Music Business Worldwide)