Music Modernization Act passes Senate unscathed in bid to fix music streaming royalties

AppleInsider

The Music Modernization Act, a bill that aims to update laws relating to music licensing and royalty payments to take into account new services like Apple Music and Spotify, has taken one more step closer to becoming law, after the U.S. Senate unanimously passed the proposal.

The bill passed with unanimous consent on Tuesday, reports Billboard, close to five months after the bill successfully passed the House of Representatives. In April, representatives were also unanimous in allowing the bill through, voting with 415 yesses and no objections.

There are still a number of steps left for the proposal to become law, with the agreed-upon Senate version of the bill now needing approval from the House. Lastly, the bill will have to receive a presidential signature to bring it into law.

It is noted that the legislation went through a fast-track process for approval, with 100 senators notified the bill would be put off for unanimous consent approval and would not require a vote so long as no-one objected. By the end of Tuesday, 82 senators signed on as co-sponsors of the bill, while the remaining 18 senators stayed silent in approving it.

One major change that did occur during its time in the Senate is that the bill itself has been renamed the Orrin G. Hatch Music Modernization Act, honoring Utah's Republican senator who helped introduce the bill, and will be retiring this year at the end of his term.

The Music Modernization Act aims to perform a number of functions to update existing music licensing laws. Specifically it combines the CLASSICS Act that applies to works written or recorded before 1972, the Fair Play Fair Pay Act, Musical Works Modernization Act for songwriters and publishers, and MP Act for producers and engineers.

The bill creates a blanket mechanical license and a collective for its administration, as well as changing how courts can determine rates of pay. The bill also ensures performance rate hearings between rights organizations BMI and ASCAP, as well as licensees, rotate across all U.S. Southern District Court of New York Judges, rather than the current system where cases are assigned to just two judges.

The act also eliminates part of the Digital Millennium Copyright Act of 1998 that establishes additional considerations for "pre-existing digital services" that are not provided to other digital services when rates are set, such as music streaming services like Apple Music. There is also the establishment of royalties for labels, artists, and musicians to be paid by digital services for any master recordings produced prior to February 15, 1972.

To Apple Music and its streaming competitors, the bill also adds in protections, in that the services cannot be sued for damages over royalties, so long as they comply with the law and create a database of authors and composers for all hosted music. This would help eliminate the practice of reimbursement suits against some streaming services, which have occurred in the past.

For example, Pandora settled a 2015 royalties lawsuit from major record labels over pre-1972 recordings for $90 million. Another early 2017 lawsuit demanded $1.6 billion from Spotify for claims of copyright infringement for tens of thousands of songs.

For the music industry, the bill stands to improve payments to songwriters and artists, who have previously complained about the extremely low rates they are being paid. While the bill won't change the value paid per stream by any large amount, the mechanisms it seeks to put in place aims to ensure payments do get paid.

"Songwriters have suffered long enough and this bill will allow them to be paid fairly by the streaming companies that rely on their work," said NMPA chairman Irwin Robinson, calling the passage "the most exciting development I've seen in my career."

SoundExchange president and CEO Michael Huppe said in a statement "The future of the music industry got brighter today. Creators of music moved one step closer to getting paid more fairly."

ASCAP CEO Elizabeth Matthews suggests the unanimous passage in the Senate "represents a Herculean industry-wide effort to promote and celebrate songwriters and ensure their right to a sustainable livelihood."

lkrupp

Bottom line, prices are going up.

mike1

There are still a number of steps left for the proposal to become law, with the agreed-upon Senate version of the bill now needing approval from the House. Lastly, the bill will have to receive a presidential signature to bring it into law.

Looks like there are enough votes to override a veto, if  that happened.

maestro64

I did not read this all, but I never understood, why people or companies want the government to fix their business dealings. You make a product and you want to sell it then you negotiate a deal with whom you are selling it. If you think your product has more value then you should hold out for a better price. 

The problem is most creative types tend to be very bad business people, who's fault is that, of course the government and they need to level the playing field for people who have no interest in become business savvy. Some of the best creative types who are very successful are also very good business people, they learn what they needed to do to get ahead. So it not like understanding business is a highly specialize skill.

I never agreed with what the Record business turned into which was turn out as many songs and records as possible whether they were good quality or not since the record company only made money selling records. The artist only got a small cut of them, but they had very little risk in that part of the business. Overall the record company ruined it for everyone. 

The best talent made real money doing concerts not selling records. If Artist were better business people they could do personal appearance build huge following then negotiate better streaming deals since consumers would want to hear the music and streamers like Apple would have to pay to get the content consumers want. Verse what we have today most content has the same value and we are still getting the bad with the good and having to pay for the bad just to hear the good stuff.

But this all required individuals to be responsible for their own success.

edited September 2018

spheric

This is a Good Thing. 

dysamoria

maestro64 said:

I did not read this all, but I never understood, why people or companies want the government to fix their business dealings. You make a product and you want to sell it then you negotiate a deal with whom you are selling it. If you think your product has more value then you should hold out for a better price. 

The problem is most creative types tend to be very bad business people, who's fault is that, of course the government and they need to level the playing field for people who have no interest in become business savvy. Some of the best creative types who are very successful are also very good business people, they learn what they needed to do to get ahead. So it not like understanding business is a highly specialize skill.

I never agreed with what the Record business turned into which was turn out as many songs and records as possible whether they were good quality or not since the record company only made money selling records. The artist only got a small cut of them, but they had very little risk in that part of the business. Overall the record company ruined it for everyone. 

The best talent made real money doing concerts not selling records. If Artist were better business people they could do personal appearance build huge following then negotiate better streaming deals since consumers would want to hear the music and streamers like Apple would have to pay to get the content consumers want. Verse what we have today most content has the same value and we are still getting the bad with the good and having to pay for the bad just to hear the good stuff.

But this all required individuals to be responsible for their own success.

Because individuals aren't in control of capitalism. Corporations are, and they intentionally, and regularly, screw artists and consumers in order to have the highest profits possible and the highest stock market values. 

curtishight

maestro64 said:

I did not read this all, but I never understood, why people or companies want the government to fix their business dealings. You make a product and you want to sell it then you negotiate a deal with whom you are selling it. If you think your product has more value then you should hold out for a better price. 

The problem is most creative types tend to be very bad business people, who's fault is that, of course the government and they need to level the playing field for people who have no interest in become business savvy. Some of the best creative types who are very successful are also very good business people, they learn what they needed to do to get ahead. So it not like understanding business is a highly specialize skill.

I never agreed with what the Record business turned into which was turn out as many songs and records as possible whether they were good quality or not since the record company only made money selling records. The artist only got a small cut of them, but they had very little risk in that part of the business. Overall the record company ruined it for everyone. 

The best talent made real money doing concerts not selling records. If Artist were better business people they could do personal appearance build huge following then negotiate better streaming deals since consumers would want to hear the music and streamers like Apple would have to pay to get the content consumers want. Verse what we have today most content has the same value and we are still getting the bad with the good and having to pay for the bad just to hear the good stuff.

But this all required individuals to be responsible for their own success.

Because unique situations bring us, civic society, to apply a hand, we hope it can always be a benign hand, to relationships. Kindly note the following selections:

–––

The record of early industrialization is invariably one of hard work for low pay, to say nothing of to say nothing of exploitation. I use this last word, not in the Marxist sense of paying labor less than its product (how else would capital receive its reward), but in the meaningful sense of compelling labor from people who cannot say no…. The high social costs of British industrialization reflect the shock of unpreparedness and the strange notion that wages and conditions of labor came from a voluntary agreement between free agents. Not until the British got over these illusions, in regard first to children, then to women, did they intervene in the workplace and introduce protective labor legislation.

…

The record, then, is clearly mixed. State intervention is like the little girl who had a little curl right in the middle of her forehead: when she was good, she was very, very good; and when she was bad, she was horrid.

David S. Landes, The Wealth and Poverty of Nations: Why Some Are So Rich and Some So Poor (New York: W. W. Norton & Company, 1998), 381–82, 520.

___

As much as Western Civilization is prone to loving its formulas, principles, and syllogisms, sometimes wisdom applied with a deft touch is the best answer! (Cf. Richard E. Nisbett, The Geography of Thought: How Asians and Westerners Think Differently … and Why (New York: The Free Press, 2003).

Regarding the Music Modernization Act: I was pleased to see that there was something a bunch of partisans could agree on! :-)

tokyojimu

maestro64 said:

The best talent made real money doing concerts not selling records.

Concerts were lucrative to my musician friends because they were able to sell CDs. Now, few people buy CDs, so almost all of them have had to give up full-time touring.

spamsandwich

CurtisHight said:

maestro64 said:

I did not read this all, but I never understood, why people or companies want the government to fix their business dealings. You make a product and you want to sell it then you negotiate a deal with whom you are selling it. If you think your product has more value then you should hold out for a better price. 

The problem is most creative types tend to be very bad business people, who's fault is that, of course the government and they need to level the playing field for people who have no interest in become business savvy. Some of the best creative types who are very successful are also very good business people, they learn what they needed to do to get ahead. So it not like understanding business is a highly specialize skill.

I never agreed with what the Record business turned into which was turn out as many songs and records as possible whether they were good quality or not since the record company only made money selling records. The artist only got a small cut of them, but they had very little risk in that part of the business. Overall the record company ruined it for everyone. 

The best talent made real money doing concerts not selling records. If Artist were better business people they could do personal appearance build huge following then negotiate better streaming deals since consumers would want to hear the music and streamers like Apple would have to pay to get the content consumers want. Verse what we have today most content has the same value and we are still getting the bad with the good and having to pay for the bad just to hear the good stuff.

But this all required individuals to be responsible for their own success.

Because unique situations bring us, civic society, to apply a hand, we hope it can always be a benign hand, to relationships. Kindly note the following selections:

–––

The record of early industrialization is invariably one of hard work for low pay, to say nothing of to say nothing of exploitation. I use this last word, not in the Marxist sense of paying labor less than its product (how else would capital receive its reward), but in the meaningful sense of compelling labor from people who cannot say no…. The high social costs of British industrialization reflect the shock of unpreparedness and the strange notion that wages and conditions of labor came from a voluntary agreement between free agents. Not until the British got over these illusions, in regard first to children, then to women, did they intervene in the workplace and introduce protective labor legislation.

…

The record, then, is clearly mixed. State intervention is like the little girl who had a little curl right in the middle of her forehead: when she was good, she was very, very good; and when she was bad, she was horrid.

David S. Landes, The Wealth and Poverty of Nations: Why Some Are So Rich and Some So Poor (New York: W. W. Norton & Company, 1998), 381–82, 520.

___

As much as Western Civilization is prone to loving its formulas, principles, and syllogisms, sometimes wisdom applied with a deft touch is the best answer! (Cf. Richard E. Nisbett, The Geography of Thought: How Asians and Westerners Think Differently … and Why (New York: The Free Press, 2003).

Regarding the Music Modernization Act: I was pleased to see that there was something a bunch of partisans could agree on! :-)

That defense of statism nicely summarizes why Brits are incapable of competing without the interventions of political overlords and why the ruling class has no idea how to make sense of their own people’s demands for Brexit.

nottylerdurden

The problem is most creative types tend to be very bad business people, who's fault is that, of course the government and they need to level the playing field for people who have no interest in become business savvy. Some of the best creative types who are very successful are also very good business people, they learn what they needed to do to get ahead. So it not like understanding business is a highly specialize skill.

Your grasp of creativity is only equaled by your grasp of business.

spheric

tokyojimu said:

maestro64 said:

The best talent made real money doing concerts not selling records.

Concerts were lucrative to my musician friends because they were able to sell CDs. Now, few people buy CDs, so almost all of them have had to give up full-time touring.

Yep. Unless you’re a cover band or very well-known, touring works because of merchandising. If people aren’t buying merchandise, you’re likely working for way less than minimum wage after rehearsals, office, travel, set up, Sound Check, and the gig. The two hours of show is just the gravy and the tiniest part of what needs to get paid. 

chasm

Spheric is correct. Also, there are a lot of bands/artists who can't afford to tour -- the recent King Crimson tour was a once-every-decade-or-more event (and probably one of the last ever) because of the insane cost of the musicians, instruments, acoustics, engineering, lighting, venue, and tux rentals (okay that last bit was a joke -- these guys own their tuxes). Lots of artists I love tour rarely/irregularly or don't stray far from their home base (mostly the UK in my case).

"Just tour" is not a panacea for paying artists what they deserve for what they create. Your mentality would have us get nothing but "remember that hit song I recorded with a full orchestra? Here it is on acoustic guitar, solo" every time someone toured. The ignorance of how much touring actually costs is on full display here as well: educate yourself here: http://www.hypebot.com/hypebot/2018/09/how-much-does-it-cost-to-tour-in-2018.html

edited September 2018

maestro64

nottylerdurden said:

The problem is most creative types tend to be very bad business people, who's fault is that, of course the government and they need to level the playing field for people who have no interest in become business savvy. Some of the best creative types who are very successful are also very good business people, they learn what they needed to do to get ahead. So it not like understanding business is a highly specialize skill.

Your grasp of creativity is only equaled by your grasp of business.

Yep you missed the point, You can not learn creativity, it is either something you are good at or not. I always want to sing and play a guitar, problem is I have no beat and my singing sounds like someone strangling a cat, nothing a great music teacher can fix. If you lack the skill that is a fact. But people need no special skill to learn about business. I have true respect those with the skill to be creative and create music since it is a skill I can never master.

maestro64

dysamoria said:

maestro64 said:

I did not read this all, but I never understood, why people or companies want the government to fix their business dealings. You make a product and you want to sell it then you negotiate a deal with whom you are selling it. If you think your product has more value then you should hold out for a better price. 

The problem is most creative types tend to be very bad business people, who's fault is that, of course the government and they need to level the playing field for people who have no interest in become business savvy. Some of the best creative types who are very successful are also very good business people, they learn what they needed to do to get ahead. So it not like understanding business is a highly specialize skill.

I never agreed with what the Record business turned into which was turn out as many songs and records as possible whether they were good quality or not since the record company only made money selling records. The artist only got a small cut of them, but they had very little risk in that part of the business. Overall the record company ruined it for everyone. 

The best talent made real money doing concerts not selling records. If Artist were better business people they could do personal appearance build huge following then negotiate better streaming deals since consumers would want to hear the music and streamers like Apple would have to pay to get the content consumers want. Verse what we have today most content has the same value and we are still getting the bad with the good and having to pay for the bad just to hear the good stuff.

But this all required individuals to be responsible for their own success.

Because individuals aren't in control of capitalism. Corporations are, and they intentionally, and regularly, screw artists and consumers in order to have the highest profits possible and the highest stock market values. 

So all the people in the US who do not work for a companies who are successful on their own and are worth lots of money are not in control of capitalism. We live in a country in which people start companies and grow them into huge businesses and these people make lots of money for themselves and the people who decide to join in with them. Corporations or governments do not create all the new business in this country, individual do.

I am not saying artists were not taken advantage of by record labels, but individual need to be responsible for what they sign up for as well. If you are not willing to do all the hard work and sign that part over to others you can not expect to reap all the rewards if you not take most of the risk. Those who take most of the risk tend to make most of the money.

edited September 2018