Discussion of FCC, copyright, advertising and other legal issues of importance to radio and television broadcasters and other media companies
Here are some of the regulatory developments of significance to broadcasters from the last week, with links to where you can go to find more information as to how these actions may affect your operations.
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Last week, we discussed the controversy started by Neil Young removing his music from Spotify because of its carriage of Joe Rogan’s podcast. In that article, we looked at the relationship between music royalties and the decision of Spotify and other music services to emphasize podcasts and other talk programming over music. Today, we will look at how music rights and royalties impact decisions like those of Neil Young and other musicians who may have wanted to pull their music to support the protest over Rogan’s podcast.
At its most basic level, there is the question of how much the artists themselves stand to lose from the withdrawal of their music from a service like Spotify. Young himself said that he would lose 60% of his streaming revenue from pulling his music, which one source estimated to be over $700,000. Given the other streaming services that now exist, his music is still available and generating revenue on his catalog, though apparently less than the amount generated by Spotify. The 60% number in and of itself is interesting as, while artists and other music representatives complain about the Spotify per song payouts (likely because they offer a free, ad-supported tier with lower payouts than those from subscription services), the wider variety of services offered by Spotify seem to bring in big numbers of listeners – likely including many who would not subscribe to a pay-music service. Thus, because of the sheer numbers of listeners, and assuming that Young is representative of other artists, Spotify is responsible for the majority of the streaming revenue that has allowed the music industry to enjoy in recent years some of their most profitable years ever. Even with these banner payouts, as we noted in our article on the Spotify side of the equation, the music industry is still not satisfied, recently calling the payouts “appallingly low.” More on that issue in an upcoming post on the discussions of a US broadcast radio sound recording performance royalty.
Continue Reading Spotify, Joe Rogan and Neil Young – Looking at the Rights and Royalty Issues Behind the Story (Part 2 – The Rights of the Artists to Pull Their Music)
The last two weeks have been filled with stories about Neil Young, Joni Mitchell and other artists pulling their music from Spotify in protest of its carriage of the Joe Rogan podcast. While the political statements made by these actions generate the news, there are rights and royalty issues behind the story that are worth exploring. While Washington Post articles here and here touch on some of these issues, looking at them in more depth helps to explain the importance that Spotify places on podcasts and why it would be reluctant to pull a podcast that has so many listeners (reportedly over 10 million per episode), even if the podcast has content that may be objectionable. The issues raised by this controversy are also tied into two other stories that made the news for broadcasters this last week – Congressional hearings on the Journalism Competition and Preservation Act and on a potential sound recording performance royalty on over-the-air radio – topics we will cover in subsequent articles.
Let’s first look at the question of why Spotify, which started as a music service, has pushed so hard into podcasting. We will follow up with a discussion of the issues on the artist side of the equation in a second article. Spotify reportedly paid more than a hundred million dollars for the rights to the Rogan podcast. It has also invested heavily in other podcast companies – including buying podcast technology companies including Anchor and Megaphone, and podcast content aggregators including Gimlet and the Ringer. Deals with celebrities for their podcasts include those with former President Obama for his podcast with Bruce Springsteen, as well as an announced content creation deal with Prince Harry and Meghan Markle. Why would a music service spend so heavily to get into spoken word programming?
Continue Reading Spotify, Joe Rogan and Neil Young – Looking at the Rights and Royalty Issues Behind the Story (Part 1 – Why Spotify Has Been Promoting More Podcasts)
Last week, the NY Times ran an interesting article, here, about how many old TV programs now available on streaming services are missing music that was featured on the original broadcast. This was because when the music rights were initially purchased, their use was limited to over-the-air broadcasts or was limited to a short period of time, with the producers never envisioning that the programs would be available through on-demand streaming services decades after they originally aired on over-the-air television. While not mentioned in the article, for many radio broadcasters one of the series most missed on streaming services is the industry favorite WKRP in Cincinnati. That series took forever to get to digital outlets, and still does not appear to be on any subscription streaming service, reportedly because of music rights issues. This article and the issues that it highlights should be a warning not just to TV producers, but also to anyone planning to use music in audio or video productions – including podcasts and online videos – that clearing music rights is essential to insure that these productions can be fully exploited not only when they are first made available, but also in the future if they are repurposed for other platforms.
We have written before (see, for example, our articles here and here) about the need to get permission from the copyright holders in both the musical work (or musical composition – the words and music to a song) and in the sound recording (or master recording – the song as recorded by a particular band or singer). Just signing up with a performing rights organization (ASCAP, BMI, SESAC or GMR) is not enough because, while podcasts may involve the public performances of the musical works that these organizations license, they do not give rights to make the permanent fixed copies of those songs, synchronized with other audio in the podcast, that can be accessed and downloaded on demand. These uses require the additional copyrights to reproduce and distribute music, and arguably to make derivative works, that can only be obtained from the copyright holder (see our article here describing why the PRO license itself does not give all rights needed to use music in podcasts). Similarly, the rights to the sound recording must also be obtained from the copyright holder in the recording – and payments to SoundExchange do not cover the on-demand music uses involved in a podcast. Thus, when the necessary rights are not obtained from the copyright holders, we have seen podcasts go silent after infringement claims are brought or threatened (see our article here).
Continue Reading Missing Music On Streamed TV Programs Highlights Rights Issues for Podcasters and Video Producers
Here are some of the regulatory developments of the last week of significance to broadcasters, with links to where you can go to find more information as to how these actions may affect your operations.
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The use of music has long been an issue for those looking to provide music-oriented podcasts to the public. As we have written before (see, for example, our articles here and here), clearing rights to use music in podcasts is not as simple as signing up with ASCAP, BMI and SESAC (or even adding GMR or SoundExchange to the mix). These organizations simply cover public performance rights for music when, as our prior articles make clear, podcasts require additional rights to use music in ways not fully covered by the licenses that are offered by these organizations. The rights to the use both the underlying musical composition and the actual recording of that composition by a band or singer must be obtained on an individual basis from the copyright holders. That can often mean a search for both the publisher and record company who usually own those copyright in the musical composition and the sound recording, respectively. This can often be a difficult search, especially if there are multiple songwriters of a composition (and hence multiple publishing companies which likely own the copyrights) or where the rights to the songs have been assigned over time from their original owners. Plus, as we have written before, there is no easily accessible universal database yet in existence that provides up-to-date and complete records of who owns those copyrights. All this combines to make the clearance of music for use in podcasts an arduous process – and almost prohibitive for any small podcaster who wants to use more than one or two pieces of music in connection with their show.
In an article in the radio industry newsletter Inside Radio this week, it appears that at least two music-oriented podcasts have attracted the attention of the music industry, receiving demands from the RIAA which has led to their ceasing of operations. It appears that these cases demonstrate both the difficulty of clearing music for podcasts, and perhaps that, as podcasting is growing in attention, the legal issues associated with the use of music in those podcasts is coming to the forefront of the attention of the music industry. …
Continue Reading Music in Podcasts – As Podcasts Shut Down Following Infringement Notices, Looking at the Required Music Rights
The Radio Music License Committee and SESAC yesterday announced an extension of the terms of the royalty agreement that is currently in place between the commercial radio industry and this performing rights organization. As we wrote here, the agreement under which radio broadcasters have been paying for the last three years was arrived at after an arbitration process following the settlement of an antitrust proceeding, and resulted in a dramatic reduction in the amount of the royalties paid to SESAC prior to that litigation. The antitrust settlement calls for arbitration every three years if RMLC and SESAC cannot voluntarily arrive at new royalties. The initial three-year period expired at the end of the 2018. The parties have been negotiating a deal that covers the period starting from January 1, 2019, and the new deal that they arrived at runs for four years through December 31, 2022. The new blanket agreement is available on the RMLC website here and with instructions from SESAC here. It principally carries forward the deal terms of the prior agreement.
Note that in many trade press reports there have been statements that the agreement covers the public performance of SESAC music, not just on over-the-air radio but also on the streams of broadcast stations and in other “new media transmissions.” These new media transmissions, under the terms of the agreement, also include “radio-style podcasts.” As we noted in connection with RMLC’s recent license agreement with BMI, these agreements cover the public performance rights in a podcast, but that is not the only music license that you need to use music in a podcast. As podcasts are downloadable and playable on-demand, and they involve the synchronization of music and speech into a unified recorded work, the rights under Copyright law to make reproductions and likely the right to make derivative works of these recordings need to be secured. These rights need to come directly from the copyright holders in both the musical composition (the words and music of a song) and the sound recording (that song as recorded by a particular band or singer). The public performance rights from ASCAP, BMI and SESAC are insufficient by themselves to give you the rights to use music in a podcast, which is why there are so few podcasts that make extensive use of major label recorded music. …
Continue Reading RMLC and SESAC Agree to Extend Current License Agreement for Commercial Radio – Music Licensing Update for Radio
Our friends at Edison Research recently released a study on music discovery highlighting the ways in which people discover new music. Among their findings was that broadcast radio, YouTube and streaming services were among the largest sources for that discovery. That report caused one radio trade publication to suggest that podcasts, which ranked relatively low among the places where new music is discovered, might have opportunities to grow there. What that suggestion overlooks is one of the biggest reasons that music podcasts have not taken off – rights issues. There still is no easy way to clear the rights to major label music – so most podcasts are limited to spoken word featuring limited, directly licensed music.
That comment made us think that we should re-run an article from earlier this year, that explained music rights in podcasts. That article was prompted by the settlement between the Radio Music License Committee and BMI over music royalties for broadcasting. While a press release about the settlement said that the BMI license includes the use of music in podcasts, we pointed out that radio stations should not assume that means that they can start to play popular music in their podcasts without obtaining the rights to that music directly from rightsholders. They cannot, as BMI controls only a portion of the rights necessary to use music in podcasts and, without obtaining all of the remaining rights to that music, a podcaster using the music with only a BMI license is looking for a copyright infringement claim.
Continue Reading Using Music in Podcasts – Talk to the Copyright Holders – Why You Can’t Rely on Your ASCAP, BMI, SESAC and SoundExchange Licenses
We summarized the provisions of Section 230 of the Communications Decency Act on Monday, looking at the application of the law that the President has sought to change through the Executive Order released last week. Today, it’s time to look at what the Executive Order purports to do and what practical effects it might have on media companies, including broadcasters. As we noted in our first article, the reach of Section 230 is broad enough that any company with an online presence where content is created and posted by someone other than the site owner is protected by Section 230 – so that would include the online properties of almost every media company has.
The Executive Order has four distinct action items directed to different parts of the government. The first, which has perhaps received the most publicity in the broadcast world, is the President’s direction that the Department of Commerce, acting through its National Telecommunications and Information Administration (NTIA – the Executive Branch office principally responsible for telecommunications policy), file a petition for rulemaking at the FCC. This petition would ask that the FCC review Section 230 to determine if the protections afforded by the law are really as broad as they have been interpreted by the courts. The Executive Order suggests that the FCC should review whether the ability granted by the law for an online platform to curate content posted by others – the “Good Samaritan” provisions that we wrote about on Monday – could trigger a loss of protections from civil liability for third-party content if sites exercise the curation rights in a manner that is not deemed to be in “good faith”. The Executive Order directs this inquiry even though the protections for hosting online content are in a separate subsection of the law from the language granting the ability to curate content, and the protections from liability for third-party content contain no good faith language. The Order suggests that the FCC should find that there would not be “good faith” if the reasons given for the curation actions were “pretextual,” if there was no notice and right to be heard by the party whose content is curated, and if the curation is contrary to the service’s terms of use. The Order suggests that the FCC should adopt rules to clarify these issues. …
Continue Reading Looking at the President’s Executive Order on Online Media – Part 2, What Real Risk Does It Pose for Media Companies?
When the President issues an Executive Order asking for examination of Section 230 of the Communications Decency Act, which permitted the growth of so many Internet companies, broadcasters and other media companies ask what effect the action may have on their operations. On an initial reading, the impact of the order is very uncertain, as much of it simply calls on other government agencies to review the actions of online platforms. But, given its focus on “online platforms” subject to the immunity from liability afforded by Section 230, and given the broad reach of Section 230 protections as interpreted by the Courts to cover any website or web platform that hosts content produced by others, the ultimate implications of any change in policy affecting these protections could be profound. A change in policy could affect not only the huge online platforms that it appears to target, but even media companies that allow public comments on their stories, contests that call for the posting of content developed by third parties to be judged for purposes of awarding prizes, or the sites of content aggregators who post content developed by others (e.g. podcast hosting platforms).
Today, we will look at what Section 230 is, and the practical implications of the loss of its protections would have for online services. The implications include the potential for even greater censorship by these platforms of what is being posted online – seemingly the opposite of the intent of the Executive Order triggered by the perceived limitations imposed on tweets of the President and on the social media posts of other conservative commentators. In a later post, we’ll look at some of the other provisions of the Executive Order, and the actions that it is asks other government agencies (including the FCC and the FTC) to take. …
Continue Reading The President’s Executive Order on Online Media – What Does Section 230 of the Communications Decency Act Provide?
