So have you heard about the Music Modernization Act?
If you're a music publisher, you've probably been on the receiving end of emails for
the past two years urging you to contact your congressman or your senator about the bill.
If you're really lucky, maybe you've been invited to an industry panel where
experts discuss the issue and toss around acronyms as if they were
radio station call letters wondering whether the MMA would enable
the MLC to work with the NMPA to eliminate the HFA,
and the collection of royalties as provided by the CRB.
"Wow, that sounds really confusing," you say.
I'm glad I'm just a songwriter.
Well, I have news for you.
If you're a songwriter, you're also a music publisher.
Congratulations.
You became one, the minute you wrote your first song.
You're not only the songwriter of that song,
you're also the publisher.
This means that the Music Modernization Act was created specifically for you.
It will change how you get paid and probably how much you get paid.
So it's worth taking a few minutes to try to understand what this thing
is all about.
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In fact, it has almost nothing to do with music at all.
It should actually be called helping
musicians get money for their Music Modernization Act.
Because like most things that the government and the courts are involved in,
it's actually about money.
The Music Modernization Act is legislation that was
passed into law in 2018 in the United States.
The process began in 2017 in the face of
real desperation from songwriters and music publishers,
who are watching as the streaming business drove
their own business straight down the drain.
With songwriters and publishers really staring into the abyss,
David Israelite, the CEO of the National Music Publishers Association,
and probably the closest thing we'll get to a hero, in this particular story,
pushed for legislation that would address
the critical issues between the digital service providers
and the songwriting community.
As the bill progressed, eventually, all sides of the music industry got involved
and it was finally passed into law in 2018.
It involved all sectors of the music industry,
music publishers and songwriters on one hand,
record labels and artists on the other hand,
and the digital service providers.
People like Spotify, Google, Apple, Amazon, and Pandora,
who were largely represented by the Digital Media Association.
The goal of this effort was to address issues on all sides
of the streaming business.
Songwriters and publishers primarily wanted to
address the issue of raising royalty rates.
At that time, record labels and artists were receiving five times the amount for
the sound recording as music publishers and songwriters
were receiving for the composition,
but music publishers also wanted to address the issue of
unlicensed music that was being used on the various digital sites.
At that time, much of the music that was
being used on the sites was not licensed properly.
Royalties were either not being paid at all or
they were being paid to the wrong people.
The labels, for their part, wanted to ensure that whatever gains were
made by the music publishers and songwriters didn't come at their expense.
They also wanted to protect these new digital streaming services
as they were making a lot of money from them.
In fact, the major record companies had a significant investment
in Spotify, specifically.
The digital services, on the other hand, wanted to
simplify the way they were able to license music and pay out royalties,
which had proven to be very difficult and was in fact getting dangerous.
At that time, Spotify had already been hit with
several large lawsuits over unlicensed music that appeared on the site.
When the music Modernization Act became law in 2018,
everyone celebrated the fact that the worrying factions of
the various parts of the music industry had come together to find a way forward.
Kind of like children on a playground who decided to quit pummeling
themselves into oblivion and organize a polite game of kickball instead.
David Israelite said and I quote,
"For the first time in history, the music industry has
partnered with the tech industry to fix these systemic problems."
I'll let you know how that worked out a little bit later.
The bill itself is a play in three acts.
The first act is the Music Modernization Act.
This is the one that we'll be focusing on because it's
the one that most directly affects songwriters and music publishers.
Act II is the Classics Act.
This applies primarily to older artists whose work was done prior to 1972.
They will now be able to collect royalties for the use of their work on
digital and satellite radio just as contemporary artists do.
The third act is the Allocation for Music Producers Act.
This will actually allow music producers, engineers,
and mixers to receive royalties directly for
the use of their work on digital and satellite radio.
As I said, for our purposes here,
we'll focus primarily on the Music Modernization Act because
that's where the money is for songwriters and music publishers.
It's important to understand that the Music Modernization Act does
not do anything that's going to change songwriters lives overnight.
In fact, like most things the government does,
it doesn't change anything over night.
What it does do is establish a framework for the way that
the digital service providers, on one side Spotify, Apple,
Google, Amazon, and Pandora, interact with the music community.
Specifically, songwriters and music publishers on the other side.
It changes the way the two sides negotiate with each other,
but it doesn't specifically control the negotiations themselves.
In a sense, it's a little bit like redrawing the foul lines on a baseball diamond.
Moving the fences in about 10 feet,
moving the pitcher up two steps closer,
and then throwing the ball back to the players to play it out for themselves.
At this point, the field has been reconfigured,
but the game has not yet begun.
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