Songwriters Battle For 'Moral Rights' And Against The Federal 'Transparency' Licensing Bill

Aug 18, 2017

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.

Songwriter Groups Call Out Record Industry Over Moral Rights Issue (Music Business Worldwide)
Benom’s Take: The issue of “moral rights” is about giving credit and attribution to the other creative professionals behind commercial recordings (composers, lyricists, producers, engineers, other performers/musicians, etc.). Instead of just the artist being recognized and credited, 170+ countries around the world are signatory to an international agreement (the Berne Convention) that, among other things, recognize moral rights as a legal requirement. However, though signatory to the agreement, the United States doesn’t recognize moral rights. This is why we’ve had a lot of public debate on the issue, particularly in regard to the songwriting/music publishing community with Spotify and other digital music services.

There are two sides to this coin. As I mentioned in a previous post, music publishers and songwriters definitely need to get their house in order with record keeping and avoiding conflicting copyright claims. That is absolutely true, and unfortunately I’m afraid it will always be messy in some capacity. Especially on musical works with multiple creative contributors. However, on the other side of the coin, there are already industry standards for compiling and disseminating this information (via the digital file’s metadata). If the information is there, then it shouldn’t be an issue.

More so, if the U.S. signed an agreement that says creators of any capacity (whether the “star” or a behind-the-scenes contributor) should be credited and recognized, then I believe we have a duty to uphold the terms of that international agreement. If anything, at bare minimum, for our international friends. They really don’t like being able to enjoy moral rights at home and elsewhere around the globe, and then get their moral rights snubbed in the U.S.

Federal Transparency Bill Endangers Songwriters’ Leverage for Getting Paid (Billboard)
Benom’s Take: The “Transparency in Music Licensing Ownership Act” has good intentions. We need a comprehensive and centralized database that makes it easy to identify rights holders for more efficient licensing and royalty payments. It’s a “pie in the sky” sort of thing, but it’s necessary and we’ve already seen movement toward this idea in the performing rights world with ASCAP and BMI.

However, I agree with the author that the bill, as is, will strip away copyright owners leverage in cases of copyright infringement. If copyright owners fail to provide or maintain the information on the database, they will be stripped of their right to statutory damages and must prove actual damages. In a massive database like this, mistakes will be made. It’s inevitable that some copyright owners will fail to provide some information or fail to maintain that information. It’s just the nature of database management. I think it’s a ridiculous provision, among some others in the bill. If the bill is to move forward, it cannot strip away copyright owner's rights already granted to them under US Copyright Law.

Round Hill Music Brings Private Equity Cash to Hitmakers From the Beatles to the Offspring (Billboard)
Benom’s Take: In recent weeks, we’ve discussed independent companies backed by big investments allowing those independents to compete with the “majors.” Round Hill is another one of those independents with a powerful catalog and strong investor relationships. Round Hill’s CEO has a background in finance and the music industry, which has attributed to Round Hill’s success. 

The information in this article further confirms the attractiveness of music royalties as an alternative asset class and a good option for diversifying a portfolio. The CEO explains that their investors expect a steady, annuity-like yield and that Round Hill’s emphasis of qualitative assets (Beatles, Offspring, The Supremes, etc.) makes it extremely attractive for investors looking to diversify and have more cash-flow.  Regardless of swings in the stock market or state of the broader economy, there is a steady flow of income from proven, quality music assets.