Nonprofit Should Address Some Music Licensing Transparency Issues, but Law Needed, Rethink Music Head Says
Some of the transparency issues that the music industry currently faces can be solved via a neutral nongovernmental organization (NGO), but intervention by Congress and federal agencies may be necessary to solve the rest, said Berklee College of Music associate professor Allen Bargfrede during an interview Thursday for a future episode of C-SPAN’s The Communicators. Bargfrede, executive director of the Berklee-sponsored Rethink Music project, led the writing of a July Rethink report that recommended that a nonprofit or other neutral consortium lead the development and administration of a decentralized, distributed music rights database in the absence of progress on government and industry-led efforts to create similar databases.
Sign up for a free preview to unlock the rest of this article
Timely, relevant coverage of court proceedings and agency rulings involving tariffs, classification, valuation, origin and antidumping and countervailing duties. Each day, Trade Law Daily subscribers receive a daily headline email, in-depth PDF edition and access to all relevant documents via our trade law source document library and website.
An “agnostic” NGO has a better likelihood of bringing together disparate music industry stakeholders to address transparency issues than has been the case in efforts like the European Union’s 2008-2012 Global Repertoire Database Working Group, which was attempting to create a comprehensive global music rights database, Bargfrede said. That project “ultimately fell apart” over issues like which stakeholders would pay for the database and who would provide the data, Bargfrede said. A nonprofit shouldn’t try to seek complete consensus among all stakeholders before bringing a database online, he said. Berklee is considering leading the development of a database via consortium model but wants to collaborate with industry stakeholders like RIAA, major publishers and labels as well as smaller independent entities, Bargfrede said.
The Rethink report recommended creating a “Creator’s Bill of Rights” that outlines ethical standards for providing creators with more transparent access to information on rights ownership and the royalties process. The Rethink report also urged the creation of a process for certifying that digital services and labels provide transparent information to creators and recommended the industry explore the use of blockchain technology to manage and track royalties payments. Blockchain is the distributed database technology that backs bitcoin. Blockchain technology could make it easier for creators to track how royalties are paid out and would allow an earlier split of those royalties rather than allowing them to “trickle down” to creators as they do now, Bargfrede said. Digital services company Kobalt underwrites the Rethink project.
"There’s room to move forward” immediately on legislation to address music licensing issues, Bargfrede said. The Fair Play Fair Pay Act (HR-1733), is one of the highest profile bills thus far to emerge from the House Judiciary Committee's ongoing Copyright Act review. Fair Play would require most terrestrial radio stations to begin paying performance royalties and also would update the royalty rules for digital and satellite broadcasters (see 1504130056). RIAA CEO Cary Sherman argued in favor of terrestrial performance royalties in a clip from an interview for another future episode of The Communicators, saying that “it’s remarkable that in this day and age” terrestrial radio stations don’t pay performance royalties. “This is a $16 billion industry where they’re earning $16 billion in advertising revenues every year from the use of music, and they pay nothing for it.” Most other developed nations require terrestrial stations to pay performance royalties, so “we’d want to fix” the U.S.’s near-unique situation, Sherman said.
Music licensing issues have received considerable attention throughout House Judiciary’s review, but industry lobbyists have told us they believe the committee is likely to put the most weight on drafting legislation to address copyright issues that affect multiple media like determining whether to move the Copyright Office out of the Library of Congress and either make it an independent agency or place it in the auspices of a federal department. These broader issues and a “wholesale rewrite of the Copyright Act” probably need to take place, “but there’s no reason that this particular issues can’t be advanced this year,” Bargfrede said.