What is all of the commotion?
The music community has been in an uproar in regards to the last-minute proposed changes in the Music Modernization Act. The Music Modernization Act, also known as, the MMA is a bill that unanimously passed the House of Representatives and recently was under debate in the Senate. It is a known fact that the digital revolution in music has had a tremendous impact on the music business itself. Fans can now stream music from almost anywhere and from multiple devices. What does this mean for songwriters and artists? The Music Modernization Act is an attempt to update the laws that dictate how artists and songwriters get paid. The laws regarding this matter have changed very little in decades. Some royalty payment laws are still enforced by rules that can be dated back to 1909 and 1941. Taste of Country states that according to songwriters and advocates the dramatic revenue shift since the advent of streaming, and the inequitable way the revenue is split, has had a profoundly negative impact on songwriters.
According to Bart Herbison, Executive Director of the Nashville Songwriters Association International, also known as the NSAI, artists and songwriters get millions of spins on streaming services and make tens of dollars, or hundreds of dollars.
The Music Modernization Act addresses this issue by asking streaming services such as YouTube, Spotify, Apple Music, etc. to work with publishers to modernize the licensing process. With this being said, the legislation would also set up a blanket mechanical license. A mechanical license in regards to music, is a license that grants the rights to reproduce and distribute copyrighted musical compositions, also known as songs, on CD’s, records, tapes, ringtones, permanent digital downloads (PDF), interactive streams, and other digital configurations supporting various business models. This mechanical license would collect and pay out royalties from digital services. However, SESAC proposed an amendment to the current version of the MMA (which already passed in the House of Representatives). This amendment was considered to be a “last-minute” proposition which led artists and songwriters to get suspicious, causing a controversial topic.
Who is SESAC and why did they propose this amendment?
The controversy begins with realizing that SESAC’s parent company is Blackstone Group. Blackstone Group is a financial management company that also owns the Harry Fox Agency. The Harry Fox Agency is a large contributor to mechanical licensing. Under SESAC’s proposed amendment they would use “certified administrators” who would serve as the liaison between SESAC and music rights organizations such as ASCAP and BMI in order to negotiate royalty rates individually. SESAC stated that their amendment “maintains competition, and ultimately drives better royalty distributions to songwriters.”
What is the problem?
The Nashville Songwriters Association International sees the situation very differently. They recently stated “Instead of songwriter royalties running directly through the music-licensing collective controlled by songwriters and publishers—Blackstone wants them to run through streaming companies and the Harry Fox Agency!!!” The NSAI and other music organizations believe that by taking the authority out of the songwriters’ hands would be detrimental to the music industry.
What did these contrasting statements do to the music community?
After the NSAI made these comments artists have turned to social media in order to gain support for passing the Music Modernization Act as is. Some of these artists include Maren Morris, Brothers Osborn, Adam Levine, and many more. Fans, advocates, artists, songwriters, managers, and more have also posted to social media in support of the Music Modernization Act, as is. It was made clear that fans who wanted to support the MMA should write to their senator and encourage them to support the act as is. Meaning that they should disregard the amendment SESAC proposed.
What does this mean for the future of music?
Songwriters are the backbone to the music industry. With this being said, songwriters need to generate income in order to survive, just like everyone else. If songwriters do not receive adequate income in order to do so, they will have to find other ways to make a living. This could crash the music industry. The Music Modernization Act has been established in hopes to aid in the royalties that should come from streaming services. Back in April the Music Modernization Act passed in the House of Representatives when lawmakers voted for it unanimously. This means that if the Senate passes this act and it becomes law, it could potentially save the future of American songwriting.
Did SESAC hear the artists, songwriters, publishers, and fans?
The answer to the above question is yes. SESAC’s CEO, John Josephson released the following statement: “SESAC has been fighting for songwriters since 1931 and continues to do so with its enthusiastic support of the MMA. At the encouragement of Senators closely involved in this legislation, all parties came together to agree on outstanding items related to the MMA including the reform of the Section 115 compulsory license and other important related matters…We share a collective responsibility to help ensure that the MMA benefits all stakeholders in the industry and look forward to the Senate’s consideration of the bill.” It has not been made clear what exactly the compromise necessitates. However, SESAC’s amendment proposal is being withdrawn.
Is it time to celebrate?
The Nashville Songwriters Association International and National Publishers Music Association (NMPA) thinks so! Both organizations celebrate this withdrawal, along with the rest of the opposing music community. The National Publishers Music Association President, David Israelite commented “We are thrilled that we have mutually agreed on a path forward. We are stronger when our music family speaks with one voice and this agreement will allow us to come together to work towards the passage of the MMA. Songwriters need and deserve this bill. We thank the Senators involved for their leadership and guidance.” The Nashville Songwriters Association International said in a statement: “Reaching consensus within the music industry, on what may be the most important songwriter legislation in history, is a win for American songwriters and the broader music community. We are pleased to have put our differences behind us and support this bill in unanimous harmony. The Nashville Songwriters Association International has been a friend and fan of SESAC’s for decades and that is how our relationship will immediately resume.” All music fans rejoiced in the harmonization between the different music organizations. It can be concluded that voices can be heard and that everyone wants what is best for the music industry and community.
What else can we expect?
Additionally, the Music Modernization Act will create a new criterion for how digital mechanical royalties are calculated. The terms will be more favorable to songwriters. The collective will be in charge of identifying copyright holders and paying them. A royalty will also be created for producers and engineers. It would begin to pay artists internet royalties for songs that were recorded prior to 1972. However, the pre-1972 component of the bill has received some unfavorable response. People are urging senators to pass the bill. However, some senators are hesitant to support the bill until everything has been figured out. Although the amendment originally proposed by SESAC created a hiccup in the MMA process, it has had some positive outcomes. All music organizations are working in unison to reach an agreement that will give songwriters and the music industry the best possible outcome. Everyone hopes to see the MMA passed before the November election. Once there is a new Congress the process starts over. Meaning that the importance of the Music Modernization Act for songwriters is at a do-or-die time.
What does this prove?
This controversy proves that voices can be heard. With the support from artists, songwriters, publishers, advocates, and fans, it can be concluded that each music organization wants what is best for the music industry. It is the first time in music history that all genres and all company affiliations are on the same side. By uniting these organizations, compromises have been made and the Music Modernization Act is back on track to modernize the laws on how royalties are paid out to songwriters and artists in this digital era we are living in.