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On Wednesday, the House Judiciary Committee will be holding a “mark-up session” (see this notice of the session) where they will be considering the American Music Fairness Act which proposes to impose a sound recording performance royalty on over-the-air broadcasting.  This would be a royalty paid to SoundExchange to benefit the recording artist and copyright holder (usually the record company) and would be in addition to the royalties already paid to composers and publishing companies through royalties paid to ASCAP, BMI, SESAC and GMR.  A mark-up session considers amendments to the bill and could lead to the committee’s approval of the bill.  If approved by the Committee, the bill would still need to be approved by the full House of Representatives and the Senate (and signed by the President) before it became law.  With the current session of Congress coming to a close at the end of the month, the proposed legislation would need to start over in the Congress.  Thus, unless the bill is tacked on to some must-pass legislation in this “lame duck” session of Congress, any action this week by the committee will likely simply be a marker for action in the new year.

The NAB has already issued a statement about the session, pointing out that a majority of the House members have signed on to the Local Radio Freedom Act stating that they will not vote for this legislation.  The statement also reiterates the NAB’s interest in working on a “mutually beneficial solution” to the issue of the broadcast performance royalty (an interest in a possible solution we wrote about here).  Nevertheless, with this issue back on the table, even if only in a symbolic way, we thought that we should re-post our summary of the American Music Fairness Act and the issues that it raises that we wrote last year, when the legislation was first introduced.
Continue Reading House of Representatives Judiciary Committee to Consider American Music Fairness Act Proposing Sound Recording Performance Royalty on Over-the-Air Broadcasting

The Copyright Office is now a part of the Library of Congress, with the Register of Copyrights (the head of the Copyright Office) appointed by the Librarian of Congress. As part of its plans to review the Copyright Act, the House Judiciary Committee asked for comments earlier this year about structural reform of the Copyright…

The US House of Representatives has been looking at potential reform of the Copyright Act for some time, holding a number of hearings before the Committee here in Washington DC (see, for instance, our article here about one of those hearings). Yesterday, the Committee announced that it is taking its examination on the road, conducting a “listening tour” of the country, starting with a roundtable on music issues to be held in Nashville on September 22. The Committee’s announcement of the listening tour (available here), says that future dates and locations (and presumably topics) will be announced at a later date.   The announcement states:

America’s copyright industries – movies, television programming, music, books, video games and computer software – and technology sector are vitally important to our national economy.  The House Judiciary Committee’s copyright review is focused on determining whether our copyright laws are still working in the digital age to reward creativity and innovation in order to ensure these crucial industries can thrive.

So what are some of the issues that are likely to be considered? On the music side, there are many issues, including questions about the disparity between the payments from digital media companies made to songwriters as opposed to sound recording rights holders (see our article here), the amounts of the royalties themselves (with digital media companies finding many royalties to be too high to allow for a profitable operation while rights holders argue that they are too low to compensate creators for the decrease in the sale of music in a physical form – see our article on how the one-to-one nature of the digital performance complicates the discussion of the value of music when compared with analog performances), issues as to whether broadcasters should pay a performance royalty for sound recordings, and the question of pre-1972 sound recordings (see our last article on pre-1972 sound recordings, here). Many of these issues were addressed by the Copyright Office in its report on reform of the copyright laws as they relate to music (see our summary here). Some of the songwriter issues are also being considered by the Department of Justice in its review of the antitrust consent decrees governing ASCAP and BMI (see our article here).
Continue Reading House Judiciary Committee Begins Nationwide Listening Tour on Copyright Reform – First Roundtable on September 22 in Nashville Focusing on Music Issues

The House of Representatives Judiciary Committee last week finished its second hearing on music licensing (written witness statements and a link to the webcast can be found here).  Congressional hearings usually are not in-depth proceedings looking to establish detailed facts as done in a hearing in a court proceeding.  Instead, they are formalized proceedings where parties get to make their canned statements setting out positions on issues.  Congressional representatives themselves make statements setting out their positions on the issues, and ask pointed questions to selected witnesses to reinforce those positions.  Minds are rarely changed, and the truly undecided are rarely illuminated on the issues.  But the hearings do serve to set out the issues that are going to be considered by the Committee in ultimately crafting legislation.  And last week’s hearing did just that – highlighting the issues likely to be considered in legislation promised by the Committee Chair, Representative Goodlatte, who promised an omnibus bill on music licensing, dubbed the “Music Bus,” to address the many issues on the table.

Note that any bill that is ultimately introduced will address many seemingly minor issues – details of process and procedure that don’t make the headlines.  But the big issues are the ones that will cause the most industry argument before the lawyers work out the details.  It’s also important to note that it is very late in the legislative calendar right now, with the Senate not putting the same emphasis on copyright issues as it the House.  With elections coming up in the Fall, and scheduled upcoming summer recess, Congress has much must-pass legislation that will fill up their legislative days before the next Congress is sworn in in January.  The start of a new Congress means that all legislation will have a fresh start.  Thus, any Omnibus bill that is introduced this year will most likely not become law, but instead will set the agenda for discussions for next year in the new Congress.  Certainly, there may be more limited bills that sponsors may try to get stuck on other legislation that must move before the end of the Congressional session, so interested parties will remain vigilant during the final days of this session of Congress.  But what are the issues that are on the table for inclusion in any Music Bus?
Continue Reading The Summer of Copyright, Part 2 – The House Judiciary Committee Plans Omnibus Music Licensing Bill – The “Music Bus”

This is the summer of copyright – as seemingly every government agency with any connection to media issues is looking at music licensing and other copyright issues.  Much press was given to the House Judiciary Committee hearing held last week.  But the Congressional committee’s consideration of copyright issues is but one of the many places where issues of importance to broadcasters and digital media companies are being reviewed.  The Copyright Office is doing its own review of the music royalty landscape (see our articles here and here), and I had the privilege of participating in their first roundtable discussion of these issues in Nashville the week before last.  Also holding hearings on copyright issues is the Commerce Department in connection with their Green Paper, which we summarized here and here.  The Copyright Royalty Board is starting its consideration of the recordkeeping requirements for webcasters and other digital music users (here and here), and also has begun the proceeding to determine the rates to be paid by webcasters for the public performance of sound recordings for the period of 2016-2020 (here and here).  And there is proposed legislation on pre-1972 sound recordings (the RESPECT Act), songwriters’ royalties (the Songwriters Equity Act) and another bill proposing to limit the collection of retransmission consent fees by TV companies that also own radio stations and don’t pay performance royalties to musicians.  On top of all that, law suits are pending in various courts on these and related issues, and the Department of Justice just announced a proceeding to review the consent decrees governing ASCAP and BMI that have been in place for over 50 years. I could easily cover nothing but music issues on this blog, and still not have enough time to write about all the pending proceedings, much less any new ones that may arise as I’m trying to catch up on all that has gone before.  But let’s start with one of the fundamental issues driving a significant part of this review.

Perhaps surprisingly, one of the principal drivers of much of this review of the Copyright laws is not whether there should be a performance royalty for sound recordings paid by broadcasters to record companies and performers for music played over the air, or even issues about the amount of royalties paid to recording artists and labels in the digital world – though much of the trade press (particularly the broadcast trade press) seems to focus on these issues, and to present them as the drivers of all of these reform proposals.  Certainly these issues are alive and important – but the area where there seems to be the most passion, and the strongest lobbying effort for copyright reform of music licensing deals not with performers and labels, but instead with the amounts that songwriters get paid for their use of music – with the debate focusing on how much they get paid by digital services for music streaming, and by the record labels for making “reproductions” of their compositions.
Continue Reading The Summer of Copyright and Music Licensing Part 1 – Songwriters Demand A Bigger Share

This week, six Congressional supporters of the broadcast performance royalty wrote a letter calling upon the NAB to sit down with music industry representatives to reach a "negotiated resolution" of the "longstanding disagreement" in a session to last from November 17 through December 1.  The letter suggests that the negotiations will be supervised by Members of Congress and the staff of the Judiciary Committees of Congress, with a report to be made by the Committee staff at the end of the negotiation period which will be considered by Congress in further actions on this issue.  The parties are instructed to bring individuals who have decision-making power to reach an agreement.  Could this call for negotiations really result in a deal that would lead to a law requiring that radio broadcasters pay a fee for the use of sound recordings on their over-the-air stations?

First, we must ask whether there will even be any negotiations.  The NAB’s only statement issued thus far says that they are willing to "talk to Congress" about the matter, but that they hoped that the discussion would include some of the almost 300 members of Congress who oppose the royalty.  As we’ve written before, the NAB has over 250 Congressmen and over 20 Senators signed on to resolutions opposing the performance royalty.  With the initial letter being signed by 6 supporters of the royalty, and the Judiciary Committees of both the House and Senate being filled with its supporters, why would the NAB be willing to jump into what could be seen as the lion’s den – engaging in a high stakes competition where the referees are on the record as favoring one side?  Note that the NAB statement says nothing about participating in "negotiations", which the former President of the NAB had said that he would never do.  We will have to see whether the change at the top of the NAB will bring a change in the attitude of the NAB.  New NAB President Gordon Smith, who has been in his job less than two weeks,  is said to be more of a consensus-builder than his predecessor, but he has had a very short time to come up to speed on the issue or to build any sort of consensus among those he now represents on where to go on this issue. Continue Reading Congressional Supporters of Performance Royalty Tell NAB to Negotiate With Music Industry – Will It Resolve Anything?

The House of Representatives Judiciary Committee today approved a bill that would impose, for the first time, a royalty on radio broadcasters for the public performance of sound recordings in their over-the-air broadcasts.  if this bill were to be adopted by the full House of Representatives and the Senate, and signed by the President, broadcasters would have to pay for the use of sound recordings (the actual recording of a song by a particular musical artist) in addition to the royalties that they already pay to ASCAP, BMI and SESAC for the public performance of the underlying musical composition.  While, from the discussion at the hearing today, the bill is much amended from the original bill (about which we wrote, here) to try to address some of the issue that have been raised by critics, the Committee made clear that there were still issues that needed to be addressed – preferably through negotiations between broadcasters and the recording industry – before the bill would move on to the full House for consideration.  It was, as Representative Shelia Jackson Lee of Texas stated, still a "work in progress."  In fact, the Committee asked that the General Accounting Office conduct an expedited study of the impact of this legislation on radio and on musicians – but it did not wait for that study before approving the bill – despite requests from some royalty opponents that it do so. 

While I have not yet seen a copy of the amended bill that Congressman John Conyers, the Chairman of the Committee, said had been completed only a few hours before the hearing, the statements made at the hearing set out some details of the changes made to the original version of the bill.  First, changes were made to reduce the impact on small broadcasters – reducing royalties to as little as $500 for stations that make less than $100,000 in yearly gross revenues.  Interestingly, Representative Zoe Lofgren pointed out that, in a bill that means to address the perceived inequality in royalties, a small webcaster with $100,000 in revenues would be paying $10,000 in royalties – 20 times what is proposed for the small broadcaster.  And the small broadcaster who would pay $5000 for revenues up to $1.25 million in revenue would be paying 1/30th of the amount paid by a small webcaster making that same amount of revenue.Continue Reading Broadcast Performance Royalty Passes House Judiciary Committee – A Work In Progress