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US songwriter group raises three key concerns with Music Modernization Act

By | Published on Monday 26 February 2018

US Congress

While a number of organisations representing songwriters have endorsed the proposed Music Modernization Act in the US, some in the American songwriting community reckon changes still need to be made to the legislation – as it works its way through Congress – to ensure it is truly creator friendly. Last week the Council Of Music Creators identified three key issues: governance of the new collecting society it will create, the system for distributing unallocated royalties, and the lack of a grievance process.

The Music Modernization Act seeks to end the mechanical rights mess in the US, which has resulted in some songwriters and music publishers going unpaid by the streaming services, and most of those streaming firms being sued for copyright infringement. Including, of course, the mega-bucks $1.6 billion lawsuit against Spotify.

The problem for the digital music companies in the US is that, unlike in most other countries, there isn’t a collecting society that can provide a catch-all blanket licence covering the so called mechanical rights in all songs wherever the streaming firm doesn’t have a direct deal in place with a music publisher.

Instead the streaming firm must identify the song exploited in any one track uploaded by a record label, work out who wrote and published that song, and then send them the paperwork and royalties as required by the compulsory licence that covers mechanical rights Stateside. This has proven tricky, not least because there is no one-stop publicly accessible music rights database to help with the process.

The Music Modernization Act would set up a mechanical rights society in the US for the first time, solving this problem for the streaming firms. It would also change the way the rates are set for royalties due under compulsory licences or the collective licensing system in the US, making it attractive to songwriters and publishers as well.

With that in mind, those behind the act are hoping to present a united front in Washington, with songwriters, publishers and streaming firms all on side, in a bid to get the Music Modernization Act through Congress in a relatively speedy fashion.

Some songwriters do back the proposals. The organisations Songwriters Of North America and Nashville Songwriters Association International were on board from the off, while the Songwriters Guild Of America formally gave the legislation its backing earlier this month after a few changes were made. In particular, an increase in the number of songwriters who will sit on the boards overseeing the new collecting society.

However, at the time the SGA did add that it would “continue to applaud the efforts of members of the music creator and publishing communities seeking further improvements”. One group of writers still pushing for further change is the Council Of Music Creators which, like SGA, is part of a coalition called Music Creators North America.

Last week the CMC posted a YouTube video in which it outlined its three main grievances with the latest draft of the Music Modernization Act. The video begins by agreeing that “the bill does some very good things for music creators”, but, it then adds, “it also contains a few things that need to be fixed, or at least clarified, before anything gets signed into law”. The CMC then sets out its top three grievances.

First, it notes that, as a result of previous lobbying, the board overseeing the new collecting society will now consist of ten publishers and four songwriters. “The four writers are there because most of this money is writer money and they’re supposed to make sure everything is done on the up and up”, says the CMC. But, it adds, “the publishers want to pick the writers who sit on the board. Publishers want to decide which writers are allowed to see what’s going on. We think writers should choose their own representatives”.

Secondly, it raises that common question that comes up whenever a collecting society collects and distributes royalties. What does it do when it doesn’t know who to pay? Because while the Music Modernization Act will mean the streaming firms no longer need to identify what songs have been streamed and which publishers and writers are due royalties, someone will still have to work that out – ie the new collecting society.

Taking issue with the current plan for distributing unallocated royalties, the CMC goes on: “Self-published writers are the ones most likely to have their music unidentified or misidentified by digital music services. If these writers don’t claim their royalties from the collective, 100% of their royalties will go to publishers based on the publishers’ market share. That means that the big publishers and their top writers will get most of that money. Money that belongs to the self-published writers. This needs to be fixed”.

Finally, the CMC wants the MMA to set out a grievance process for the new collecting society. Noting that “things don’t always work out the way we want”, the organisation’s video goes on: “Right now the MMA contains no grievance process for music creators who get left out of the process or feel they haven’t been treated fairly. Big songwriters with lawyers and accountants will be able to audit their publishers, but tens of thousands of songwriters won’t. The MMA should include some process that allows regular songwriters to have their concerns addressed by an independent party”.

Most of these are ultimately issues between the songwriters and the music publishers, rather than the music community and the streaming firms. It remains to be seen what additional amendments are made to the MMA in a bid to get everyone of a musical bent to sing its praises in Washington. You can watch the CMC’s video here: