The music Modernization Act will be known for what it does not do. Despite a strong push from the record labels, the new law does not impose any new performance fees. That fight will be left for another day. The new law does make some important changes to the current law.
First the record labels want to use market performance data (which could increase rates) to help determine the rates paid by stations. Broadcasters are opposed. The compromise was that such data may be used when calculating rates for digital services. Such evidence may not be used for calculating rates applicable to off-air broadcasts or music that is simultaneously streamed by a station. The new evidence could be used for custom or on demand music services provided by some broadcasters.
Second the new law affects pre-1972 recorded music. As you know NYSBA successfully blocked attempts to create new liability for pre-1972 recorded music under New York copyright law. The new law will create new liability under Federal copyright law for pre-1972 recorded music that is transmitted digitally. Again, there is no new copyright liability for any off-air broadcasts of pre-1972 recorded music. However stations will now be liable under Federal copyright law for any pre-1972 recorded music that is streamed. This includes any music that is simultaneously streamed over a stations website or on-line platform.
Third the Act will give Congress advanced warning if the Department of Justice (DOJ) seeks to eliminate the BMI & ACAP consent decrees. The consent decrees are administered by the Federal District Court for the Southern District of New York and create the music licensing system that applies to BMI and ASCAP. While initially a strong supporter of the consent decrees, the DOJ has now signaled that it may want to change or eliminate the consent decrees. Requiring notification Congress, which will provide oversight, will help preserve our rights.
For a more detailed summary from NAB click HERE.
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