Compromise Seen Unlikely on Top Music Licensing Policy Issues in 115th Congress
Music licensing stakeholders from all copyright camps agreed on one thing in recent conversations with us: It’s likely they will continue to disagree during the 115th Congress on an appropriate compromise that would yield legislation to revamp major portions of U.S. music licensing law. Some pointed to the early reintroduction (see 1701250034) of the NAB-backed Local Radio Freedom Act (House Concurrent Resolution 13/Senate Concurrent Resolution 6) as a sign that no side appears willing to yield on controversial music licensing policy issues.
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Others noted the comments by House Judiciary Committee Chairman Bob Goodlatte, R-Va., during a Federalist Society event Wednesday about the emphasis the committee would place on music licensing issues in possible legislation. Goodlatte repeatedly has emphasized the importance of music licensing issues as part of House Judiciary’s copyright law review and highlighted Wednesday that he would be interested in pursuing a policy proposal to address those issues because they're “ripe for work.” But he also cautioned it was “an area that is very hotly contested,” which could be an impediment to House Judiciary pursuing legislation amid the numerous other copyright policy issues it wants to address (see 1702010069).
Goodlatte’s comments are a strong indicator that House Judiciary views the music licensing debate as remaining at "the level of trench warfare,” said a lobbyist for content-side stakeholders. A tech sector lobbyist said that “both sides have dug in.” Proposals to require most terrestrial radio stations to begin paying performance royalties appear to be a “nonstarter for the broadcast industry and the recording industry is still pushing that as one of their top agenda items,” the tech lobbyist said. “My guess is you’re going to see the same back-and-forth” on music licensing legislation, including those dealing with the terrestrial performance right, “if not intensified,” said Fletcher Heald copyright lawyer Kevin Goldberg.
“Obviously, it is a high priority for NAB to defeat any performance right [requirement for terrestrial broadcasters], which is why I’m not surprised that even in the absence of [the Fair Play Fair Pay Act], they pushed for the introduction of” H. Con. Res. 13/S. Con. Res. 6, Goldberg said. Music licensing stakeholders viewed the resolution as aimed at scuttling attempts to advance the Fair Play Fair Pay Act and other music licensing legislation (see 1504160050 and 1605110059). Goldberg also noted the continued ascendency of new House Communications Subcommittee Chairwoman Marsha Blackburn, R-Tenn., as an important factor in the debate’s dynamics. Blackburn has been an advocate for the Fair Play Fair Pay Act and other bills seen as favoring songwriters, though House Communications doesn't have a jurisdictional role over music licensing issues.
Broadcasters and musicians will continue to have the “same old fight” on terrestrial royalties but that shouldn't prevent the debate from continuing, said music industry attorney Chris Castle. But there are “other things that Congress could fix that would fall short of a broad terrestrial royalty,” including language from the Fair Play Fair Pay Act that would require digital broadcasters to begin paying royalties for pre-1972 sound recordings, he said. It makes sense for House Judiciary to continue to pursue music licensing and other copyright issues in separate bills given the likely difficulty of passing omnibus legislation, Castle said. NAB is "committed to working with [Goodlatte] on Copyright Office modernization," a spokesman said.
There's hope for progress on less-controversial music licensing policy issues, lobbyists said. “You may see stakeholders get together and see if there is a compromise to be had amongst the industries” on pre-1972 performance royalties, songwriter royalties and Copyright Act Section 115 compulsory licenses, a tech sector lobbyist said. “I think it’s possible to build a consensus on those based on the very informal conversations we’ve had. Progress is not certain but with the recognition that this Congress marks [Goodlatte’s] final two years as House Judiciary chairman, there’s more of a desire to see something done.”
All parties could reach agreement on the need to unify the dual licensing systems imposed by the Copyright Royalty Board and the rate courts established to administer the American Society of Composers, Authors and Publishers and Broadcast Music Inc., said a music industry lobbyist: “Music licensing is all over the place” and DOJ’s ongoing fight with ASCAP and BMI over fractional licensing may be leading to an increasing sense that “we should move to one system” for administering rate-setting proceedings. Stakeholders’ ability to reach a consensus on lower-temperature music licensing issues becomes easier if Goodlatte chooses a “piecemeal” approach rather than choosing to pursue omnibus legislation, the lobbyist said.
“A lot of constituents care” about music licensing issues but Goodlatte clearly faces a “balancing act” to address all opinions, said Computer and Communications Industry Association Senior Policy Counsel Ali Sternburg. Music licensing has been the only copyright policy issue Goodlatte publicly referenced with anywhere near the same frequency that he mentioned CO modernization, but it’s unclear if that means that’s the next issue he wants to issue a proposal on, Sternburg said. Goodlatte and House Judiciary ranking member John Conyers, D-Mich., are considering how to proceed with their CO-centric policy proposal, which suggested giving the office more autonomy from the Library of Congress and requiring all future registers to be subject to Senate approval (see 1612080061 and 1612220048).