The broadcast trade press is full today with the news that NAB CEO Gordon Smith will be stepping back from that position at the end of the year, to be replaced by current COO (and former head of Government Relations) Curtis LeGeyt.  As many will remember, Smith took over the organization over a decade ago during a turbulent time for the industry.  At the time, TV stations faced increasing calls for other uses of the broadcast spectrum, and radio stations faced a possible performance royalty on their over-the-air broadcasts of sound recordings.  Since then, through all sorts of issues, there has been a general consensus in the industry that its leadership was in capable hands and meeting the issues as they arose.

But many issues remain for broadcasters – some of them ones that have never gone away completely.  The sound recording performance royalty for over-the-air broadcasting remains an issue, as do other music licensing issues calling for changes to the way that songwriters and composers are compensated, generally calling for higher payments or different compensation systems (see our articles here on the GMR controversy and here on the review of music industry antitrust consent decrees).  TV stations, while having gone through the incentive auction giving up significant parts of the TV broadcast spectrum, still face demands by wireless operators and others hungry for more spectrum to provide the many in-demand services necessary to meet the need for faster mobile services (see our articles here on C-Band redeployment and here on requests for a set aside of TV spectrum for unlicensed wireless users).  But competition from digital services may well be the biggest current issue facing broadcasters.
Continue Reading With a Change at the Top at the NAB as CEO Gordon Smith Plans His Departure – What are the Regulatory Issues That are Facing Broadcasters?

Global Music Rights (most commonly known as GMR), the newest of the major performing rights organizations (PROs) licensing public performances of musical compositions, filed a lawsuit against radio operator Entravision Communications earlier this month. The suit alleges that Entravision failed to pay GMR royalties for the public performance of hundreds of compositions written by GMR songwriters. According to the complaint, GMR sent Entravision several letters over the last few years, notifying Entravision that it was playing GMR music and asking that it enter into a license to play that music. When no license was signed or even requested after these multiple requests, the lawsuit was filed.

The suit seeks $150,000 for each copyrighted work that was allegedly infringed – the maximum set out by the Copyright Act for “statutory damages,” i.e. damages that can be collected even without providing evidence of actual harm caused by the alleged copyright infringement. While Courts have discretion to order far lower statutory damages than those being sought here, even the threat of such damages have been enough to put many of the original file-sharing music sites out of business. Of course, in this case, these damages are being sought not from some company that provides unlimited downloads of unlicensed music, but from a publicly traded radio company presumably already paying other performing rights organizations for the use of music.
Continue Reading GMR Sues Entravision for Royalty Payments – Looking at the Issues Raised By This New Development in the Music Royalty Wars

The Copyright Royalty Board on Friday published in the Federal Register its decision setting the royalty rates that noncommercial broadcasters will pay to the performing rights organizations for the public performance of musical compositions in over-the-air broadcasting during the period 2018-2022.  The rates reflect settlements between ASCAP, BMI and SESAC and various organizations representing

Last week, I participated in a discussion about music royalties for broadcasters at the Texas Association of Broadcasters Annual Convention in Austin. Speaking on the panel with me were the heads of the Radio Music License Committee and the TV Music Licensing Committee. These are the organizations that represent most commercial broadcasters in their negotiations with ASCAP, BMI and SESAC for public performance licenses for “musical works” or “musical compositions” – the underlying words and music to any song. In our discussion, there was a general summary of the licenses needed for the use of music by broadcasters, a summary of the status of some of the current royalty negotiations, and questions about other issues in music licensing. As this discussion raised a number of issues that I have covered in articles posted on this blog, I thought that it might be worth highlighting some of that past coverage so that those interested in any topic can read a bit more on these subjects.

The TV industry seems to have far fewer issues than radio, perhaps because radio is so much more music-dependent. While there is music in many TV programs, some of it is cleared (i.e. licenses have been negotiated) by the program providers (including some networks), so that stations need only worry about licenses for programming where the music has not been pre-cleared. Thus, TV stations have alternatives of blanket licenses for all programming (principally used by affiliates of networks where music has not been pre-cleared) or per-program fees where stations pay for music only in programs or program segments where music has not been licensed by the program suppliers.
Continue Reading Looking at Music Royalty Issues for Radio and TV Broadcasters

This week SoundExchange, the non-profit rights organization that collects the royalties paid by digital music companies for the public performance in the United States of sound recordings, announced that it had acquired CMRRA (the Canadian Musical Reproduction Rights Agency, Ltd). CMRRA licenses the reproduction rights to musical works in Canada. As we have written before, musical works or musical compositions are the lyrics and music for a song, while the sound recording is the actual recording of that song by a singer, band or other performer. We have also written before about the difference between the public performance right and the right to make reproductions of songs (including “mechanical rights”), rights that arise in different contexts and usually require a different type of license before a music service can use a song in its business. Why would a company that licenses the public performances of sound recordings in the US acquire a company that licenses reproduction rights in Canada?

SoundExchange’s public notice talks about its ability to “integrate and streamline the administration and distribution of sound recording and music publishing royalties.” And it also highlights that the deal will allow it to “offer a broad and comprehensive range of services to rights holders in both sound recordings and music publishing and music users alike across North America.” While SoundExchange suggests that it is the first company to offer a comprehensive range of services in licensing both sound recordings and musical works in North America, this deal instead seems to be part of a trend where rights collectives are merging to offer such comprehensive services in licensing both public performance rights and the rights to make reproductions, for both sound recordings and musical works.
Continue Reading SoundExchange Acquires CMRRA – What Does it Mean for Music Licensing?

While there is a new administration in charge at the FCC, there are still those regular regulatory dates that broadcasters must face, as well as dates unique to pending proceedings that arise from time to time. Before we get to the February dates, we should remind broadcasters of those January 31 dates that they should be considering, including the deadline for signing up for the Interim License Agreement for those radio stations playing music represented by the new performing rights organization GMR (see our articles here and here). January 31 is also the deadline for payment of SoundExchange yearly minimum fees by webcasters (including broadcasters who stream their music on the Internet), as well as the date for comments to the House Judiciary Committee on the structure of the Copyright Office (see our article here) and with the Copyright Office on the qualifications for a new Register of Copyrights (see our article here).

With the start of February, there are routine regulatory dates for broadcasters dealing with EEO requirements. Commercial and Noncommercial Full-Power and Class A Television Stations and AM and FM Radio Stations in Arkansas, Kansas, Louisiana, Mississippi, Nebraska, New Jersey, New York, and Oklahoma that are part of an Employment Unit with 5 or more full-time employees, must place in their public file (or upload to their online file for TV and radio stations that have already converted) their EEO Public File Reports. Stations also need to put a link to the EEO Public File reports on the home page of their websites, if their station has a website (meaning they have to have a webpage for their most recent report if they have not converted to the online public file). For Radio Station Employment Units with 11 or more full-time employees in Kansas, Nebraska, and Oklahoma and Television Employment Units with five or more full-time employees in Arkansas, Louisiana, and Mississippi, FCC Mid-Term Reports on Form 397 must be submitted to the FCC by February 1. We wrote about FCC Mid-Term Reports here.
Continue Reading February Regulatory Dates for Broadcasters – EEO Reports and Comments on Ownership, EEO and Copyright Issues

Here we are at the start of a new year, and right away we have numerous regulatory deadlines for broadcasters. By the 10th of the month, all broadcast stations need to have placed in their public inspection files (online for TV and for those radio stations that have already converted to the online public file, and paper for the remaining radio stations), their Quarterly Issues Programs lists, documenting the issues of importance to their communities and the programs broadcast in the last quarter addressing those issues. TV stations have quarterly Children’s Television Reports due to be filed at the FCC by the 10th, addressing the programming that they broadcast to meet the educational and informational needs of children. Commercial TV stations should also add to their public file documentation to demonstrate their compliance with the commercial limits in programming addressed to children.

For TV stations, on the 1st of the year, new obligations became effective for online captioning. “Montages” of clips from TV programs, where all of those clips were captioned when broadcast, also need to be captioned when made available online. By July 1, clips of live and near-live programming must be captioned; however, they may be posted online initially without captions as long as captions are added to clips of live programming within 12 hours and to clips of near-live programming within eight hours after the conclusion of the TV showing of the full-length programming. For more on this requirement, see our article here.
Continue Reading January Regulatory Dates for Broadcasters – Quarterly Issues Programs Lists and Children’s Television Reports, Ownership and EEO Comments, Copyright Issues and More

There is now a vacancy in the top position at the Copyright Office, the Register of Copyrights, and the Librarian of Congress, who appoints the Register, has asked for comments on the role and qualifications for the new Register. These comments are due by January 31, 2017. While setting copyright law has

SESAC was, until recently, the only one of the three major performing rights organizations (PROs) that was not subject to an antitrust consent decree – meaning that it could set the rates that it wanted without any oversight by any court or other judicial body. For practical purposes, that ended when the radio and television industries separately sued SESAC claiming antitrust violations. Both the radio and TV industries felt that the SESAC royalties were too high in relation to those charged by ASCAP and BMI given the far greater amount of music controlled by these two larger PROs. As we wrote here (television) and here (radio), both antitrust cases ended with settlements where SESAC agreed that its rates would be subject to review by an arbitration panel to assure their reasonableness, if voluntary negotiations between the groups representing the industries and SESAC were not successful in arriving at mutually agreeable rates. So far, it appears that the rate-setting process for radio and TV are going in different directions.

The TV Music License Committee and SESAC have announced that they have reached an agreement in principle as to rates for the TV industry. See the press release here. While the agreement has not been finalized or made public, if negotiations of the final documents are successful, the TV industry and SESAC appear to avoid having their rates set by the arbitration process. So far, that does not seem to be the case for the radio industry.
Continue Reading Update on the SESAC Royalty Arbitration Proceedings with the Radio and TV Industries