This week, after the House passed similar legislation last April, the Senate Judiciary Committee voted unanimously to pass the Music Modernization Act.
The legislation is actually a consolidation of three previous bills:
- The Compensating Legacy Artists for their Songs, Service, and Important Contributions to Society (CLASSICS) Act, which compensate artists for pre-1972 recordings that previously did not require royalties for digital production or distribution;
- The Allocation for Music Producers (AMP) Act, which allows producers and engineers to receive direct payments for recordings played on satellite and online radio stations;
- The Music Modernization Act (MMA), which would create a SoundExchange-style institution to collect and distribute credits and royalties for music distributed using digital networks.
There’s certainly room for improvement in the way artists are compensated in the digital era. Writing for EFF, Mitch Stoltz explains:
The Music Modernization Act addresses a big problem in the music business: many songwriters and music publishers have trouble collecting royalties for the use of their songs for digital streaming. Today’s systems and organizations that administer these “mechanical royalty” payments (for the reproduction and distribution of songs) are not up to the task. Millions of dollars in royalties go unclaimed. Several music publishers have tried to create a solution by brute force, filing lawsuits for billions of dollars under copyright’s draconian civil penalty regime.
The MMA would create a new licensing collective to gather data about who should be paid for the use of songs, and to distribute royalties, replacing the unpredictable litigation bazooka of statutory damages with a fairer system. That’s a copyright fix we can get behind.
But the extension of copyright protection for up to 144 years to previous works via the CLASSICS Act is counterproductive. The purpose of copyright is to incentivize artists to create new art. Granting protection for works that have already been created doesn’t.
David Israelite, president of the National Music Publishers’ Association, explained the music industry’s motivation to forego further litigation in exchange for this compromise bill:
“I have no doubt that we could have sued [Spotify and other digital music platforms] out of existence,” Mr. Israelite said of streaming services. “But we took a different approach. We decided that we wanted to settle this and try to fix the problem, because we want them to be our business partners.”
Spotify and other streaming services shouldn’t be slapped with increased copyright restrictions, even if the legislation consolidates the process for managing the rights to music. Evidence shows that Spotify displaces piracy, and the decline in purchasing music for download is roughly made up for by the revenue from streaming.
Whatever complexities and inefficient are present in our current system, the MMA is just more of the same.
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