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The legal issues surrounding the use of music in broadcast and digital media is one of those topics that is usually enough to make eyes glaze over.  The importance of understanding these issues is illustrated by this week’s request from the Department of Justice for more information about the rights of songwriters to authorize ASCAP and BMI (often referred to as Performing Rights Organizations or PROs) to license their works to services like radio stations and webcasters when there are multiple songwriters who may not all be members of the same rights organization.  While we try to provide some explanations of some of those issues on this Blog, I wanted to point to a couple of other resources available to address some of these issues and to, hopefully, help make some of those issues understandable.

First, I wanted to note that I’ll be moderating a panel on current music issues at the NAB Radio Show in Atlanta on Thursday afternoon (the panel is described here) featuring representatives of the NAB, RIAA, BMI, Pandora and the Copyright Office.  Hopefully, we’ll be able to unpack some of the motivations and directions of the music royalty debates that are going on in Washington DC.  For those of you not able to make that panel, and even those of you who are planning to attend, a new source of information that provides a very good summary of the many music licensing issues now being considered by Congress and the courts is a report prepared by the Congressional Research Service released last week, available here.  The report explains in relatively simple terms how music licensing works in the United States, and describes many of the current legislative and judicial issues that currently could affect that licensing.  While obviously not addressing all of the subtleties of the arguments of all of the parties to these proceedings, the report does at least give a relatively neutral summary of the arguments of the parties.
Continue Reading Understanding Music Royalties – Congressional Research Service Releases Summary of the Law, While DOJ Asks for More Comments on ASCAP and BMI Consent Decree Reform

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

While we have written much about the battle over the broadcast performance royalty (or the "performance tax" as broadcasters call it) – whether broadcasters will have to pay artists and record labels for the right to play their music on the air – we have not written much about another looming issue with the royalties that broadcasters must pay to play music on their stations.  While broadcasters are very familiar with the ASCAP and BMI royalties, they may not be fully aware that there is a looming dispute over the amount that broadcasters will pay to these organizations in the near future.  At a panel that I moderated at the NAB Radio Show, Bill Velez, the head of the Radio Music Licensing Committee, talked about the current negotiations for the renewal of the royalty agreements between radio stations and these two Performing Rights Organizations ("PROs").  Both of the current agreements expire at the end of this year, and the RMLC is in the process of trying to negotiate new agreements.  However, because many broadcasters feel that the current deals charge more for these music rights than is justified in the current economic environment, while the PROs are reluctant to decrease the royalties that the composers they represent currently receive, the differing perceptions of the value of these rights could lead to litigation over the amount that should be paid by broadcasters for the use of this music.

First, it is important to understand what rights ASCAP and BMI are providing. These organizations, along with SESAC (about which we have written here), provide the copyright license for the "public performance" of the "musical work" or the composition, the words and musical notes to a song.  This is in contrast to the rights to the sound recording (the song as performed and recorded by a specific artist), which is licensed by SoundExchange.  Webcasters have to pay ASCAP and BMI for the use of the composition, as well as paying SoundExchange for the use of the sound recording when streaming music on the Internet.  Broadcasters only have the obligation to pay ASCAP,BMI and SESAC for the composition in connection with their over the air broadcasts but do not, under the current law (unless the broadcast performance royalty is passed), have to pay SoundExchange.  Because the current ASCAP and BMI royalties have been in place for several years, most broadcasters probably don’t think much about them, but they may have to in the near future.Continue Reading ASCAP and BMI – Another Royalty Battle for Broadcasters?

The Stephen Colbert Christmas Special begins with Colbert sitting at the piano, writing new Christmas songs.  Why?  He explains that, while he likes all of the old Christmas songs well enough, he’d only get royalties if he wrote the songs, so he’s writing his own.  In a few sentences, Colbert explains the system of broadcast royalties in the United States, and the source of the dispute over the broadcast performance royalty that took up much committee time in the last Congress, and is bound to return in the next Congress in 2009.  As Colbert explains, in the US, the composers get paid when their music is played on a broadcast station. These payments come from the the royalties that broadcast stations pay to ASCAP, BMI and SESAC, the performing rights organizations or "PROs" that represent the composers or the music publishing companies that hold the copyrights to those songs.   But, as Colbert points out, the performers do not get paid when they sing the song on the air.

We’ve written about the controversy about whether or not performers should get a royalty when a song that they perform but did not write, is played on the air.  But Colbert seems to have solved the problem about the performer not getting royalties when their songs are played on the air – simply by writing his own songs. And maybe we’ll be singing these songs at future Christmas parties, paying Colbert royalties, and at the same time explaining broadcast performance royalties to future generations.Continue Reading Stephen Colbert’s Christmas Special Explains Broadcast Performance Royalties