Issue 27, 2016

Parental Guidance Suggested: Some of the following material may not be suitable for sensitive readers.

To the attorney(s) in the music user community, whoever you are, who convinced the U.S. Dept. of Justice Antitrust Division (DOJ) that its consent decrees governing performance rights organizations (PROs) ASCAP and BMI must be interpreted to require their licenses cover everyone’s shares (100% of the ownership shares) of the co-written songs licensed rather than the shares the PRO’s songwriters hold in those songs, please have your client(s) bend over and take a bow. And remain in that position because they are going to get a real treat.

You obviously have spent no time in recording studios or with songwriters to understand how they compose songs, especially many of today’s hits, and how copyright law applies to that activity. I therefore predict that the marketplace turbulence resulting from this interpretation is going to be far broader and more groundbreaking than the fallout I predicted last September if such an interpretation came to pass (Risky Business: Songs in Fractions, Issues 31 & 32, 2015). While ‘groundbreaking’ is generally a good thing—getting ready for a new improvement—consider this government action not as a positive disruption but as a rumbling earthquake that will shake up everyone and likely leave some shattered but essential remains that the marketplace will be unable to reassemble.

To anyone in the recorded music industry who believes that this seemingly simple action related to ASCAP and BMI will not impact the recordings that you want U.S. radio—satellite, Internet, terrestrial—to play on specific dates or times—or at all—you would be wrong.

To anyone in the songwriter/music publishing industry who believes that this is something that ASCAP and BMI have to figure out—that it is their problem or responsibility to work through on their own—you would be wrong.

To anyone in the music user community who believes that the DOJ interpretation, expected to be formalized and made public within weeks, is a positive disruption that will make the U.S. licensing process for performance rights easier and less costly, reduce royalty rates, provide more transparency on what songs have been licensed to use, better protect you from claims of copyright infringement, force back into the blanket-license folds of ASCAP or BMI those publishers that have wanted to license the portions of rights that they represent directly to users, or push into a corner the for-profit performance rights entities SESAC or Global Music Rights (GMR) to represent fewer songs or reduce their freely-negotiated royalty rates, you would be oh so wrong.

bayentlaw