Higher Royalty Rates May Be On The Horizon For Internet Broadcasters
Over the years, Internet broadcasters were always faced with high payments to the PROS for the use of musical recordings. A few years ago Live 365 one of the largest services for internet broadcasters had to shut down their operations because of these rising and somewhat unfair costs.
On Wednesday, the President signed the Music Modernization Act which can cause an additional rise in our costs. The new law is supposed to ensure that artists get paid for their work. One new additionis that we will now have to pay royalties for music prior to 1972. The law is supposed to level the playing field for royalty distribution but what will be the affect on streaming services? We will find out soon. The entire article published by Billboard.com can be found below.
The Music Modernization Act was signed into law on Thursday by a clearly exuberant President Trump. "I've been reading about this for many years and never thought I'd be involved in it, but I got involved in it," he said of the historic legislation, which passed with unanimous support in both chambers of Congress after years of efforts by the music industry and lawmakers.
At the signing ceremony, Trump was surrounded by a smattering of supportive artists including Kid Rock, John Rich and Mike Love, along with the two Republican lawmakers whose names are officially attached to the law, Sen. Orrin Hatch of Utah and Rep. Bob Goodlatte of Virginia.
While Trump did thank members of the industry in attendance, he only mentioned one executive: Recording Academy Neil Portnow, whom he referred to as "big stuff." Short speeches were delivered by several of the artists, including Rock, Rich, Love and soul legend Sam Moore.
President Trump Signs Music Modernization Act Into Law With Kid Rock, Sam Moore As Witnesses
Here are the official reactions to the new law from key execs and organizations:
Mitch Glazier, RIAA president: "The Music Modernization Act is now the law of the land, and thousands of songwriters and artists are better for it. The result is a music market better founded on fair competition and fair pay. The enactment of this law demonstrates what music creators and digital services can do when we work together collaboratively to advance a mutually beneficial agenda. It's a great day for music. We hope fans across the country will join with us in celebration and PLAY IT LOUD."
David Israelite, NMPA president & CEO: "The Music Modernization Act is finally the law of the land. We are incredibly grateful for the Members of Congress who passed the MMA and the President for signing it. Songwriters have for too long labored without seeing fair rates and receiving all that they deserve, and for the first time in history, the music industry has partnered with the tech industry to fix these systemic problems. As we embark on supporting and helping build the critical structures within the MMA, we are humbled by the extraordinary progress propelled by compromise and the unprecedented political involvement of music creators. Today is about their future and this bill stands as a great statement on what can be done when we work together."
Neil Portnow, Recording Academy president and CEO: "As we celebrate the harmony and unity that got us here, we applaud the efforts of the thousands of performers, songwriters, and studio professionals who rallied for historic change to ensure all music creators are compensated fairly when their work is used by digital and satellite music services," he said in a statement. "We thank the members of Congress who championed this issue throughout the past several years to bring music law into the 21st century."
Elizabeth Matthews, ASCAP CEO: "Thanks to the unrelenting efforts of our ASCAP music creator and publisher members, industry partners and champions in Congress, a more sustainable future for songwriters is finally within reach. The MMA's unanimous passage in the House and Senate proves that the power of music is a great unifier. ASCAP is proud to have stood alongside creators, music publishers, and many more to make this dream a reality."
Paul Williams, ASCAP chairman of the board and president: "A young songwriter once wrote, ‘You give a little love and it all comes back to you; You’re gonna be remembered for the things that you say and do.’ Decades later, this could not be more true. Songwriters across this country now and in the future will remember those who fought so hard for the Music Modernization Act—both in Congress and across the music industry. On behalf of the music community, we are so thankful for the love and will return the favor with music for generations to come."
Mike O'Neill, BMI president and CEO: "This is truly a historic moment for the music industry, especially for the American songwriters and composers at its core, who will see significant and deserved benefit from this legislation. Passage of the Orrin G. Hatch-Bob Goodlatte Music Modernization Act was a hard-fought process that hinged on tremendous collaboration and unprecedented support among diverse stakeholders who ultimately united to safeguard the future of music. We are gratified by this extraordinary outcome that recognizes the essential contributions of creators and streamlines the use of their music across businesses. While BMI will keep advocating to protect the livelihood of music creators in the digital age, we thank Congress and the President for taking this important step in implementing the most meaningful music licensing reform in decades."
John Josephson, chairman/CEO of SESAC: "Today, President Trump signed the bi-partisan Hatch-Goodlatte Music Modernization Act (The MMA), which will finally bring music copyright laws into the digital age. We applaud everyone's hard work and tireless efforts on this legislation, especially the Senators who worked diligently to get the bill passed then adopted by the House. We're grateful for our committed songwriting and publishing community whose focus and passion have strengthened our industry for generations to come."
Michael Huppe, SoundExchange president and CEO: "With today's signing of the Music Modernization Act, we mark a historic accomplishment. But more importantly, we mark what it means. For creators, it means getting paid more fairly. For those who recorded music before 1972, it means assurance you'll get paid for your work. For songwriters, publishers and producers it means making the digital economy work for you. SoundExchange's 170,000-member community was a driving force in getting the bill from the halls of Congress to the White House. When the music industry speaks with one voice, Congress listens. I urge you to stay active because there is much more work to be done before we can truly say all music creators are treated fairly."
Michelle Lewis and Kay Hanley, Songwriters of North America (SONA) executive directors: "SONA and its membership of working songwriters would like to express heartfelt thanks to Congress and to our fellow music business stakeholders for accomplishing what everyone thought was impossible: Compromise, consensus, and passage of the Orrin G Hatch - Bob Goodlatte Music Modernization Act. As President Trump signs our bill into law, today marks another momentous event in the rich history of music and the people who create it."
Dina LaPolt, founder/owner, LaPolt Law: "Music’s unifying power helped opposing communities reach across party lines to pass the Music Modernization Act with unanimous congressional support. The President’s final signature now enshrines the MMA in U.S. law, protecting music creators for generations to come. I couldn’t be more proud of SONA and all the songwriters who engaged the entire music creator community to help get this over the line! Now the real work begins!"
Horacio Gutierrez, Spotify general counsel: "One of our core missions at Spotify is to enable a million artists to make a good living from what they love: creating and performing music. The Music Modernization Act is a huge step towards making that a reality, modernizing the outdated licensing system to suit the digital world we live in. The MMA will benefit the music community and create a more transparent and streamlined approach to music licensing and payment for artists."
Keith Kupferschmid, Copyright Alliance CEO: "The Copyright Alliance appreciates the President signing the MMA into law today, and commends and thanks members of Congress, numerous Copyright Alliance members, and friends of the music community for their support of this critical legislation. It's truly remarkable for any cause or bill to bring everyone together in a bipartisan fashion, especially a bill as complex and lengthy as this one. But that's just what happened with the Music Modernization Act. The willingness to compromise, and work with others who may have competing or different interests, in the singular effort to get this important copyright legislation passed was laudable and inspiring."
Michael Eames, Association of Independent Music Publishers (AIMP) president; Alisa Coleman, AIMP New York Executive Director; and John Ozier, AIMP Nashville Executive Director: "Today marks a historic step forward for independent music publishers, songwriters, and the entire music industry, as President Trump has signed the Hatch Goodlatte Music Modernization Act (MMA) into law. This marks the first significant federal legislation since 1998’s Digital Millennium Copyright Act (DMCA) to address the needs of rights-holders in today’s online age. We can look forward to a variety of long-overdue reforms that will make it easier to negotiate for and collect fair royalty rates while also establishing once and for all that digital services must pay for the use of pre-1972 recordings. In addition, it ensures independent publishers and songwriters a seat at the table for the new mechanical licensing collective. The AIMP is committed to ensuring that the independent publishing community and songwriters are represented fairly in the implementation and enforcement of the MMA, and we look forward to working with our partners across the music and technology industries as we move ahead in this new era. We offer our sincere gratitude to David Israelite and his team at NMPA, to the NSAI and SONA, to Senator Orrin Hatch and Congressmen Bob Goodlatte and Doug Collins, and to all parties from all sides who fought to provide a balanced outcome for all involved."
James Donio, Music Business Association president: "The Music Business Association applauds and congratulates its members and valued partners across the industry on their extraordinary and unprecedented efforts to bring the groundbreaking Music Modernization Act to fruition. What an amazing achievement for creators and their commercial partners to have come together in solidarity, and joined with Congress, to make long overdue copyright reform a reality. This is the start of an exciting new era for the entire business of music. Bravo!"
Chris Harrison, Digital Media Association (DiMA) CEO: "The Music Modernization Act moves the music industry into the streaming age and benefits consumers, creators and copyright owners. A modern industry requires a modern solution. The MMA finally brings our music licensing laws into the 21st century and ensures greater transparency and efficiency across the entire music ecosystem. This historic legislation has been a decade in the making. DiMA, and its streaming member companies, are proud to have spearheaded this process from start to finish. Working together with our industry partners and lawmakers, we believe the creation of a new, modern system will provide better clarity and benefit publishers, songwriters, artists, record labels, and digital services.... The Music Modernization Act ends old arguments of the past and moves the entire industry forward together into a brighter, better streaming future."
Martin Bandier, Sony/ATV Music Publishing chairman and CEO: "Now that the President has signed the MMA into law, we are confident that the music industry will reap the benefits of this historic piece of legislation for many years to come. For songwriters and music publishers in particular, the bill will go a long way to delivering them the fair compensation they deserve for the vital contribution they make to the thriving streaming services. With the passage of this bill, I'm pleased to say that the entire music industry agrees that everything starts with a song."
Gordon Smith, National Association of Broadcasters president and CEO: "NAB is grateful for President Trump's signature on the Orrin G. Hatch-Bob Goodlatte Music Modernization Act, thus culminating a years-long process to find consensus solutions to music licensing issues. This important legislation will benefit songwriters, legacy recording artists, producers, digital streaming services, and music listeners. We appreciate the bipartisan process that resulted in passage of this landmark legislation. Senator Hatch and Chairman Goodlatte deserve credit for their diligent work on copyright issues over the years, and NAB commends their leadership alongside Chairman Grassley and Ranking Members Nadler and Feinstein -- along with Representatives Collins and Jeffries and Senators Whitehouse, Alexander and Coons -- to skillfully guide this legislation through Congress."
Chris Israel, The musicFIRST Coalition executive director: "This achievement has been years in the making and only possible thanks to powerful advocacy from every facet of the music community. It was a movement that rose above politics and partisanship and resulted in a more effective and efficient legal framework for digital music services. Its incredible what the music community can do when we are united in voice and cause.
"The MMA is significant for many reasons, and especially because it finally put an end to one of the most egregious injustices in the industry. Music pioneers who recorded songs before February 15, 1972 -- and until now have been locked out from receiving royalties when their works are played on digital and satellite radio -- will finally be compensated like younger artists. It was a form of legal discrimination that with the stroke of a pen, today came to an end. The MMA has pushed us into a new era, but we still have strides to make when it comes to ensuring fair compensation for music creators wherever their work is played. That means terrestrial AM/FM radio."