Biggest Corps in Commercial History Can’t Figure Out How to Pay Songwriters

Here it is: Remember how Spotify, Google, Amazon, Pandora have literally dozens of lawyers arguing over song royalties for a good four years? Probably longer. Remember how these knuckleheads whined to Congress for yet another safe harbor in the so very modern Music Modernization Act? And remember how if they just had a global rights database they’d be able to pay everyone and pay them on time?

Well…as it turns out now these tech giants who can tell you what floor of your house you are Tweeting from say they can’t make an adjusting payment on time. This probably means they think the rates are going to increase, right? But here’s what Variety’s Jem Aswad says is going on:

Untold millions of dollars in legal and lobbying fees later, a decision on 2018-22 — officially called Phonorecords III — is expected in the coming days, and according to documents obtained by Variety, it appears the streaming services do not expect to be successful.

The streaming services have appealed to the Copyright Office for more time to pay that potential increase — and been soundly criticized by five U.S. senators in a letter obtained by Variety, who stated “serious concern about any requests that would delay important and necessary royalty payments to copyright owners and [oppose] any granting by the Copyright Office of an extension.”

This most recent back-and-forth began with a six-page letter to the General Counsel and Associate Register of Copyrights dated June 1 on the letterhead of Latham and Watkins — a law firm working on behalf of the Digital Licensee Coordinator, which represents music-streaming services — in which a five-point argument is made for delaying retroactive payments that may be incurred by Phonorecords III to ensure “that royalties continue to flow to copyright owners with minimal disruption and that any changes to the rates for prior time periods be addressed efficiently and effectively.”

First of all is that the same Latham and Watkins lawyer who used to be a lawyer for the Copyright Office as did the head lobbyist for Spotify? Revolving door, anyone? So there’s that.

The idea that these people need more time to get ready to pay higher rates that they themselves have lawyered up to delay for years is just a bit too rich. Watch this space, we’ll see how it turns out.

But–here’s something else we don’t need. Sometimes when it’s just “too complicated” to get it right, there’s a back room deal for a lump sum payment that settles the legal liability and also avoids the services doing any accounting.

What happens to that lump sum? Anyone’s guess. Probably goes into the same bank account with the other $500,000,000 that the MLC got its paws on and hasn’t paid out.

So no, let’s not do that again. The difference this time is that whoever steps up and says they can settle on behalf of all the publishers and songwriters in the known universe is probably lying.

Save the date June 15: @A2IM Indie Week Panel with @MusicTechPolicy on the Impact on Indie Labels of Unfreezing Mechanicals —

ARW readers in NYC may want to see Chris Castle speaking on June 15 at Indie Week on the impact on indie labels of the CRB raising the statutory mechanical rate.

Save the date: A2IM Indie Week Panel on the Impact on Indie Labels of Unfreezing Mechanicals — Music Technology Policy

@felixsalmon: Inflation has squelched the optimists

[Editor Charlie sez: Thankfully the current proposal for physical/download mechanicals includes an inflation index for songwriters but only after commenters freaked out.]

The broad optimism that Americans felt about the economy in the spring of 2021 — optimism that even a global pandemic and hundreds of thousands of COVID deaths couldn’t squelch — has finally been undone by inflation, and health worries that are getting worse rather than better. 

Why it matters: The sharp rise in food and energy prices over the past year has had a particularly harsh effect on the finances of suburban and rural Americans. 

Driving the news: Every six months, McKinsey and Ipsos conduct a massive survey of Americans, asking about their perceptions of the current state of the economy. This time around, sentiment has fallen sharply. 

By the numbers: For the first time since the survey began last year, Americans have a negative outlook on the economy. The overall index fell to 99 (a “negative outlook”) this spring from 103 (a “positive outlook”) a year ago.

Read the post on Axios

Survey Results: Physical and Download Mechanical Rates Survey

Many readers participated in the Physical and Download Mechanical Rates Survey that various organizations have sent to their members over the last few weeks. Here are the results of the main questions for which we had 361 respondents who self-selected their participation. (Other answers included comments which we chose not to publish for privacy reasons.).

The results suggest that participants were mostly informed songwriters who had never been asked before what they thought about the issues in the Copyright Royalty Board. We would have to conclude that any of our regular readers would be a bit skewed toward knowledgeable because between the Trichordist, MusicTechPolicy, ARW, Hypebot and Celebrity Access we were probably carrying a very high percentage of the available information on the frozen mechanicals issues.

It also is striking how few respondents said they had ever been asked what they think about any mechanical rates (physical, download, streaming), an important and easily measurable issue. This is something to add to the learning from this episode. It may be that our data is skewed, but even so we didn’t expect that 68% would say they’d never even been asked their opinion. An easy way to find out what people think about something is to ask them.