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.
The CRS Report addresses issues including pre-1972 sound recordings (see, for instance, our article here), the performance royalty for sound recordings for over-the-air broadcasting advocated by the recording industry, the reform of the ASCAP and BMI consent decrees and other issues about the rights of songwriters, and the reform of the standards used by the Copyright Royalty Board when setting digital sound recording public performance rights like those used by webcasters (currently being determined by the CRB, see our article here).
The new request for comment by the DOJ demonstrates just how difficult these issues can be. DOJ, as we wrote here, is looking at the antitrust consent decrees that govern the operations of ASCAP and BMI to determine whether it should recommend changes to the decrees. While the initial issue prompting the review was the threat of some of the music publishers to withdraw their catalogs from these PROs to directly license them to certain music users at rates higher than those charged by the PROs, DOJ’s new questions raise issues about songs that have several composers who may not all be part of the same PRO. The questions ask whether a PRO can license a song to a user even if some of the writers of that song are not members of that PRO. For instance, if a song is co-written by two songwriters, one of whom is a member of ASCAP and the other is represented by BMI (or SESAC or some other organization, or no organization at all), can a music service get the rights to perform that song simply by buying an ASCAP license? For songwriters, the issue is one of whether they are getting properly compensated for the performance of songs in which they have an interest if the royalties are paid to only one of several writers of a song. For services, the issue is ease of licensing – if they have to determine whether they have obtained the full rights to perform a song when they buy a license from ASCAP or BMI, it defeats the entire purpose of those organizations – to make licensing simple by providing a one-stop shop through which they can buy the rights to perform songs.
Obviously, this and other issues make music licensing very complicated – so the CRS report is a welcome document to help at least outline and clarify the issues that are currently being debated.