In a ruling released last week, a US District Court Judge issued a ruling finding that a download of a recorded musical work does not give rise to a "public performance" requiring a payment to ASCAP, BMI or SESAC. If this decision is upheld on appeal, it could mean that one less fee would have to be paid in connection with on-demand downloads – which would also affect podcasts and video downloads made available by broadcasters on their websites. However, there are many issues that must be understood about this ruling, so broadcasters should not impetuously rush to provide downloads and podcasts without first securing the bundle of rights necessary for such performances.
First, it is important to understand the issue that was presented in this case. The case did not involve streaming of programming – so it has no effect on Internet radio royalties. It involves only downloads – where a copy of a specific work is downloaded to a single consumer’s computer at the request of that consumer. This is what happens when a consumer buys a song from iTunes, or downloads a podcast made available by a broadcaster. There is no question that, to provide such a download or podcast containing music, a service needs to get permission from the copyright holder in the "sound recording," the song as recorded by a particular artist. This is typically received from the record company which holds the copyright. In addition, there is a requirement that the rights to the composition must be obtained for purposes of the making of the making of a "reproduction" and a "distribution" of the underlying composition. This is typically obtained from the publishing company or a clearinghouse such as the Harry Fox agency. A service that provides downlaods of music can alternatively pay a statutory royalty for the composition, though that requires following a somewhat cumbersome process of filings set out by the Copyright Office and requiring specific notice to the copyright holder in the publication.