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Indie publishers add to angry criticism of US government’s 100% licensing plan

By | Published on Wednesday 13 July 2016


Trade groups representing independent labels and publishers in America have joined with the chiefs of the major music publishing firms, and numerous songwriter groups, in condemning the US Department Of Justice’s recent decisions regarding the consent decrees that regulate the American collecting societies BMI and ASCAP.

As previously reported, the US music publishing community had been urging the DoJ to reform the consent decrees which regulate the collective licensing of songs in America, arguing that the current rules are out-dated in the digital age. However, the DoJ has declined to make any changes, and instead has declared that, by their reading, the current consent decrees oblige the societies to operate a 100% licensing system.

This would mean that someone with a BMI licence could make use of all the songs in that organisation’s catalogue, even where the society only controls a portion of the copyright. Because collaboration is common in songwriting, so is co-ownership of the resulting copyrights. And because American songwriters can choose between four societies to represent their performing rights, it’s common for songs to be repped by multiple PROs. And as far as the songwriters and publishers are concerned, where that is the case, a user of music needs a licence from all the societies with a stake in the work.

But not so, says the Department Of Justice, in a ruling that means that a licensee would be able to make use of a much wider range of songs with just a BMI licence. They would still need to pay full royalties for each song used, but under the 100% licensing principle, that payment could be made to BMI who would then have to pass on a share of the money to any other societies with an interest in the work.

Perhaps most importantly, the shift to 100% licensing would mean that if a licensee decided not to do a deal with the two smaller American PROs – SESAC and Global Music Rights – both of which sit outside consent decree regulation, the number of songs no longer available to said licensee would be reduced, because any works co-written by BMI and ASCAP members would be available via licences with those two societies.

As also previously reported, the bosses of Sony/ATV, Universal Music Publishing and Warner/Chappell have all hit out at the DoJ’s decision, as have BMI and ASCAP themselves, and various songwriter groups. Now the Association Of Independent Music Publishers has also issued a statement, which is backed by their counterpart in the label space, the American Association Of Independent Music, as well as the Canadian Music Publishers Association.

“This position by the DoJ on 100% licensing is 100% wrong” the three trade groups write. “The DoJ’s position will obstruct every level of the music business as songwriters’ creative processes will be impacted by which PRO their co-writers are signed with. In a world where songwriters, artists, music publishers and record companies are already being paid below market rates by tech companies that built their businesses by using our songs, the DoJ has opened the door for even lower payments”.

They go on: “The DoJ’s decision reaches far beyond our shores and threatens our relationships with foreign writers, publishers and record companies. The DoJ has now unwittingly entered the creative process in the writing room and the recording studio. They do not belong there”.

The group then claims that the DoJ’s ruling is designed to benefit media and tech giants to the detriment of the songs industry which – despite the major players – also consists of a large community of self-employed, self-published writers and small independent music publishing businesses. “Independent songwriters, music publishers and recording artists deserve more than what we have received here”, they say.

“The DoJ, and its largest supporter in its recent ruling, Public Knowledge, has propped up the media conglomerates at the expense of the entire music industry. We deserve fair market rates that are not regulated by the US government and the ability to decide when and where our property is used. The DoJ cannot be permitted to decide that for us”.

There is still the opportunity for BMI and ASCAP, and the music publishers, to fight the DoJ’s rulings on consent decree reform and 100% licensing and – beyond the angry statements – it remains to be seen what that fight will look like.

For more background on the consent decrees and the current debate, premium subscribers should check this CMU Trends article here. To become a premium subscriber for just £5 a month click here.