From what we have gathered, on May 15, the Senate will vote on the Music Modernization Act (which now includes the Classics Act and the AMP Act). It’s flying through the walls of government faster than anything we’ve ever seen. Some call it unprecedented. Some say it’s been a long time coming. The music member organizations are touting this as if we are finally getting our moment in the sun. But are we really?
ASIDE FROM CREATING A DATABASE — IS THE MMA A LANDMARK OR LANDMINE FOR MUSIC CREATORS, PRODUCERS, AND PERFORMERS?
There are arguments on both sides from within the music creator community, and it is hard to know who is “right.” All we know is that all of the “member” organizations that directly impact how musicians and music creators get paid (the AFM, ASCAP, BMI, SoundExchange) have communicated to their members to support this bill, to sign numerous petitions to Congress to ensure it passes, etc., without much member discussion on what the cons are of the legislation. In addition, the advocacy organizations (NARAS, SONA, NSAI, the SCL) have also trumpeted support without much point by point member discussion or debate, which to us is deeply concerning.
Is the MMA truly a landmark win for ALL music creators? Will money start flowing to the “little guy” who doesn’t have a publishing deal and plans to utilize streaming services to distribute his/her music, who is totally DIY, who doesn’t understand/care about the inner workings of the music industry and what the difference is between AFM, SAG-AFTRA, ASCAP, BMI, SoundExchange, and Advocacy-only groups such as NARAS, SONA, and NSAI? (This, by the way, is the majority next generation DIY musicians who upload millions of tracks into the streaming services every year.) What will REALLY change for that DIY music creator, producer, or performer? Can he/she plan to retire off of the whopping increase in earnings that passing the MMA will provide? Will they be able to figure out how to register to get their windfall in time before the publishers who are behind the MMA claim it?
If the MMA legislation is so much of a windfall moment for all music creators, producers, and performers — why is it so hard to find a concrete example (or have the advocacy groups even CREATE an example to relate to) of a DIY music creator and how the MMA will help him/her earn more income for their music (or musical contribution) from streaming? Why haven’t the member organizations provided examples of “if you wrote this, recorded this, produced this, and/or released it on a streaming platform, this is how passing the MMA will improve your music creator/producer/performer life” as a part of their non-stop rally of support for this bill? And what about the musician unions? If they want musicians to support the MMA, why haven’t they provided any examples of how a session musician (or lead singer) who played/sang on a track that is now released on a streaming service will benefit?
YOU HEARD IT HERE FIRST: THE “LANDMARK” DATABASE WILL MAKE OR BREAK THE MMA’S (THE MLC’s) SUCCESS
Over the last four years, SoundExchange members have sent many thousands of letters to Congress asking for reform of our music licensing laws. When Congress held hearings at the start of its lengthy copyright review in 2014, it was my honor to represent music creators as a witness before the House Judiciary Committee asking that they modernize our laws by requiring fair pay for all music creators whenever their music is played.
Today, I’m happy to report that our work together is paying off.
Last week, the U.S. House of Representatives passed the comprehensive
Music Modernization Act (H.R. 5447) by a unanimous vote, 415-0. This is
an historic victory that happened because of our collective efforts. It happened because of the industry- wide unity and legislative consensus we worked so hard to achieve. And it happened because of our efforts to help lawmakers understand how important music reform is to you — the music creators who are the lifeblood of our industry.
In 2017 alone, our artist partners and advocates utilized our letter writing campaign to send thousands of constituent letters. United States Senators from all 50 states and Members of Congress from 419 out of 435 districts across the country received letters asking them to support music creators by supporting music licensing reform legislation.
Because of your hard work, we’re on the cusp of success. The fight isn’t over though, and our focus now shifts to the U.S. Senate.
While several pieces of music legislation have been introduced in the Senate, there is not a single comprehensive package yet. We are encouraging our Senate allies to bring these many issues together into a single, comprehensive Music Modernization Act, like the bill passed in the House, to include:
**The CLASSICS Act (S. 2393) to ensure equal treatment for legacy artists who recorded music before 1972;
**The AMP Act (S. 2625), which builds on SoundExchange’s existing process for honoring letters of directions for producers and sound engineers; and
**The mechanical licensing reform bill (also called the Music Modernization Act). Lawmakers need to hear your voice to make this happen.
I encourage you to read this special advocacy edition of SoundByte to learn more and to find out how you can get engaged.
Thanks to our SoundExchange family for everything you have done to support our advocacy efforts on Capitol Hill. Let’s continue our work together to make history.
Yours in Music,
President & CEO
[And Apple leads Spotify in another metric, too. Apple has not filed a single “address unknown” mass NOI–not one. Spotify has filed millions.]
[An internal Apple] memo, obtained by Variety, [contained] the latest subscription milestone achieved by the three-year-old service. Apple Music now counts more than 40 million paid subscribers in 115 countries. With some 8 million auditioning the service via free trials, the service is gaining ground on its competitors — namely Spotify, which went public on April 3 — at a monthly growth rate of 5% (versus Spotify’s 2%), per a recent report in WSJ.
SoundExchange’s CEO talks licensing reform and the CLASSICS Act.
A promising occurrence is unfolding in the U.S. Congress: bipartisan agreement on meaningful legislation. Republicans and Democrats on Capitol Hill are working on a broad and impactful measure to modernize and improve many of the rules that govern how music is used in the digital era. This bipartisan consensus will benefit music creators, digital services and fans.
This situation has progressed in large measure because the music industry and digital service providers — often divided — similarly worked together to craft a unified package of reforms. More than 20 organizations representing artists, songwriters, composers, record labels, music publishers, performance rights organizations and streaming services (such as Pandora) support these bills and are asking Congress to pass them as part of a unified piece of music legislation in 2018. SoundExchange endorses this package, in line with our ongoing efforts to make our country’s music licensing system more just for everyone.
There is, unfortunately, one significant naysayer: SiriusXM. In advertisements and recent statements by the company, SiriusXM says that the legislation should be rejected because it fails to address a glaring inequity in our public policy: that broadcast radio does not pay performers for the use of their sound recordings, while SiriusXM does.
SiriusXM is right about broadcast radio. This system is unfair. Broadcast radio should absolutely compensate creators of sound recordings. For far too long, terrestrial (FM) radio has used the music of hard working artists to attract listeners to their stations, while paying those artists nothing for their work.
But this is not a reason to abandon an industry wide agreement on legislation addressing other important issues.
[Editor Charlie sez: Songwriters should note the increase in digital and physical sales and remember that the last rate hearing continued to freeze mechanical royalties on physical and permanent downloads at 9.1 cents minimum statutory–where it has been set since 2009 and will remain until 2022. Inflation alone would peg that rate at 11 cents today, if it hadn’t been frozen and increases for inflation just keeps the rate the same. So what that really means is by freezing the rate at 9.1 cents in 2009, the rate has actually decreased for inflation. That means that the mechanical rate has actually decreased by approximately 20% since 2009.]
Bandcamp is reporting a record year for 2017. Here are some highlights:
- Digital album sales were up 16% vs. a 20% industry decline)
- Track sales up 33% vs. a 23% industry decline
- Merch sales up 36%.
- Growth in physical sales was led by vinyl (up 54%) and CD sales up 18%
“Meanwhile, standalone music streaming companies continued to lose money in 2017,” the company wrote in a blog post chronicling its “stellar” year. ” The seemingly inevitable upshot of these two trends is that the majority of music consumption will eventually take place within the subscription rental services of two or three enormous corporations, who can afford to lose money on music because it attracts customers to the parts of their businesses that are profitable.”
[Editor Charlie sez: Failing to pay pre-72 artists the digital royalties they are entitled to is another example of how Big Tech forces wasteful lawsuits–and cons the industry into false choices on “omnibus” legislation!]
A veritable supergroup’s worth of sixties musicians on Friday (Jan. 12) filed an amicus brief in a California lawsuit against Pandora for its use of sound recordings made before 1972, and thus not covered by federal law. Although the issue in the case — originally brought by Flo & Eddie, Inc., which owns the Turtlesrecordings, and currently before the California Supreme Court — is fairly obscure, the artists are anything but. The amici artists include Carole King, Melissa Etheridge and Doors drummer John Densmore; the estates of Hank Williams and Judy Garland; and companies like the Beatles’ Apple Corps., Grateful Dead Productions and Experience Hendrix.
At stake is whether, and how, non-interactive streaming services like Pandora need to compensate performers and labels for their use of older recordings that are still covered by state law. The music industry has also been lobbying for a legislative answer to the question, and the recently introduced CLASSICS Act (Compensating Legacy Artists for their Songs, Service, & Important Contributions to Society Act) would require digital services to pay for the use of recordings made before 1972. On Jan. 26, the Friday before the Grammy Awards, the House Judiciary Committee will hold a “field hearing” in New York on this and other copyright issues, according to multiple sources.
[It was only a matter of time–the controversial Music Modernization Act is producing new legal analysis showing it’s not what it’s cracked up to be!]
On December 21, 2017, the Music Modernization Act of 2017 (H.R. 4706) was introduced in the House of Representatives. The bill seeks to modernize the U.S. music licensing system by (1) creating a not-for-profit mechanical licensing and royalty collective to collect and distribute mechanical royalties from interactive streaming services, such as Spotify, Apple Music, Pandora, Google Play Music, Tidal, and others, (2) requiring Copyright Royalty Judges to establish rates and terms that would have been negotiated in the free market between a willing buyer and willing seller by examining economic, competitive and programming information, such as the rates that recording artists earn, and (3) changing the rate court procedure for ASCAP and BMI, the two largest performing rights organizations in the U.S., by randomly assigning federal court judges from Southern District of New York to each rate setting proceeding.
While many in the music industry welcome this bill, smaller publishers and musicians may be surprised to learn that several of the provisions in the Music Modernization Act may harm their interests.