Arts & Entertainment, Government, and Law

Music Modernization Act streamlines music licensing

Law ensures royalties are paid, adds protection for older recordings.

May 31, 2019
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As the options of how people are listening to music digitally are broadening, the federal government also has expanded the copyright law to incorporate rules and regulations for digital services that offer music.

The Orrin G. Hatch-Bob Goodlatte Music Modernization Act, named after the two congressmen who introduced the bill, was passed in October, reforming the copyright law to address matters that are related to music being streamed online. It ensures that royalties are fully paid to songwriters, publishers, artists, record labels, etc. when their works are used digitally, and it also changes how music licenses are obtained for online streaming purposes.

“This law is primarily directed to how money is split up or it gets into the hands of songwriters for sound recordings,” said Terence Linn, partner and registered patent attorney at Gardner, Linn, Burkhart & Ondersma. “There is a little bit that would involve adding some protections where there wasn’t before. Up until this point in time, it has been very difficult for sound publishers, record companies, anybody really, to figure out how to get the money that was owed into the hands of these various different songwriters.”

There are three components of the law. According to the U.S. Copyright Office, the three key titles are: Title I—Music Licensing Modernization; Title II—Classics Protection and Access; and Title III—Allocation for Music Producers.

Title I of the Music Modernization Act allows the Mechanical Licensing Collective, a nonprofit entity, to issue a new blanket license for digital music providers, which covers all musical works that are eligible for compulsory licensing. Before, licenses for the making and distribution of music were issued on a song-by-song basis.

Title II addresses the use of unauthorized sound recordings that were first published prior to 1972. The new law allows for those sound recordings to be available for 95 years.

This section in the MMA also grants some additional time, after the allotted 95-year time period, to sound recordings that were published during a certain time period.

Per the U.S. Copyright Office:

  • Recordings first published before 1923, the additional time period ends on Dec. 31, 2021.

  • Recordings first published between 1923-46, the additional time period is five years after the general 95-year term.

  • Recordings first published between 1947-56, the additional time period is 15 years after the general 95-year term.

  • All remaining recordings first fixed prior to Feb. 15, 1972, the additional transition period shall end on Feb. 15, 2067.

“So, you can imagine all the works of The Beatles in the ’60s, ’50s and everyone else, they didn’t have a single consolidated protection in the sounds that they were making,” Linn said. “So, this law makes it more of a uniformed (protection).”

Title III, which Linn said is a big component, allows for everyone, such as music producers, mixers and sound engineers, who were involved with the creation of the music or sound recordings to receive compensation for their work that is being used. This is the first time the copyright law has included payments to producers.

“It wasn’t easy to find the correct people to put the money into the hands of,” he said. “You can recognize the artist, the band, but it wasn’t easy to track down the songwriters or who (were involved with creating) the musical scores. As a result, even though people were owed money, they wouldn’t necessarily get it. So, this takes care of that. And it makes it easier for the publishing company because they are trying to do the right thing, most of the time anyway, and pay the right people.”

The MMA requires SoundExchange, a nonprofit entity, to collect and distribute a portion of the royalties to music producers, mixers and sound engineers.

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