Broadcast, Tech, Consumer Groups Ask DOJ to Preserve Music Licensing Decrees
DOJ should defer to Congress before potentially altering the ASCAP and BMI consent decrees, broadcast and film associations commented. They joined consumer and tech industry groups in supporting preserving the decrees. Comments (see 1906050060) were due Friday night.
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The Songwriters Guild of America (SGA) urged DOJ to replace the consent decrees with a framework fostering a free market with less intervention, so artists can collect fair value. Given the evolving impact of the Music Modernization Act, Nashville Songwriters Association International (NSAI) recommended “a slow, cautious” approach before modification.
“Adhere to the principle that where an industry is structured around a longstanding precedent, it is Congress’s role to make any fundamental change,” said NAB CEO Gordon Smith. He cited the department's August 2016 conclusion from a previous review: “The current system has well served music creators and music users for decades and should remain intact.” Smith suggested if Justice wants to “facilitate congressional consideration,” it form a committee of industry and other experts to help develop recommendations to Congress.
“If they are terminated or sunset without first establishing a new legal framework to protect these businesses and other licensees, chaos will result,” said the Music Innovation Consumers Coalition. The MIC Coalition cited pro-competitive benefits of the decrees, which allow music to be “licensed at a fair and reasonable price.” Eliminating them would encourage ASCAP and BMI to abuse market positions and monopolistic pricing, the coalition said. The performing rights organizations (PROs) “collectively represent approximately 90 percent of public performance rights in musical works,” it said. Like NAB, the coalition cited 2016 conclusions from DOJ: “Industry has developed in the context of, and in reliance on, these consent decrees and that they therefore should remain in place.”
For some 80 years, the decrees “presented an impenetrable barrier preventing American music creators from realizing the full, fair market value of their performing rights,” said SGA. It supports comments by ASCAP and BMI in February, arguing that a “free market with less government regulation is hands down the best way for music creators to be rewarded for their hard work and intellectual property.” But SGA recommended DOJ install an alternative framework to prevent “chaos.” SGA asked the agency to preserve music creators’ right of choice to select their own PRO.
Before passage of the Music Modernization Act, NSAI pushed for the consent decrees to be altered to address “the depressed digital performance rates that songwriters received under restrictions imposed” by the decrees. The MMA means the PROs can introduce “marketplace-based evidence for the judges’ consideration when determining certain performance royalty rates,” NSAI said. Since 2018 enactment, neither PRO has “engaged in a single rate court proceeding,” NSAI said: “Changes would now be premature." It "advocates a slow, cautious and measured approach before making any modifications to the decrees or sunsetting them.”
Public Knowledge, the Computer & Communications Industry Association, MPAA, Independent Film & Television Alliance (IFTA) and National Religious Broadcasters (NRB) support DOJ preserving or not weakening the consent decrees. “Without robust competition in the music licensing market, consumers could face higher prices, less choice, and an increase in licensing costs,” said PK Policy Counsel Meredith Rose.
Ensure “rightsholders, who coordinate marketplace activity, nevertheless offer fair terms,” said CCIA Chief Operating Officer Matt Schruers. “Weakening these consent decrees would go against Congress’s intent, and ultimately harm all stakeholders.” The decrees have enabled “predictable, efficient means of licensing the public performance rights that are a necessary, key ingredient in making audiovisual content available for viewing,” said MPAA and IFTA: “If the ASCAP and BMI decrees were terminated, this system would be thrown into upheaval and consumers would suffer due to increased costs and prices and/or reduced supply, inefficient processes, and uncertainty.”
Move cautiously and ensure comparable competition protections before altering or sunsetting the decrees, NRB said. Key protections like “immediate licensing upon request” and “judicial resolution of fee disputes under a competitive market standard” should be expanded, it said.