INDIE INSIDER
DID THE U . S . DEPARTMENT OF JUSTICE SCREW SONGWRITERS & PUBLISHERS ?
In June 2016 , following a two-year review , the United States Department of Justice ( DoJ ) released a decision that sent the music publishing world reeling . The DoJ upheld , without any changes , decades old consent decrees that require American performing rights organizations ( PROs ) ASCAP and BMI to license songs at a fixed rate ; furthermore , in a move that the music publishing industry is calling “ punitive ,” the DoJ also called for 100 per cent licensing . That means where there is a song that has two or more co-songwriters – with one songwriter represented by BMI and the other with ASCAP – a media company that wants to license that song , under a 100 per cent licensing scheme , only needs to obtain a license from either ASCAP or BMI , not both , even though neither PRO represents all the rights holders of that song . Under the existing system , the company licensing a song would need a license from all PROs whose members have a songwriting credit on the song .
It ’ s little wonder why one unnamed music industry executive told Billboard that “ this decision will create a clusterfuck of epic proportions for the U . S . music publishing industry .” And unfortunately for Canadian and other international publishers and songwriters whose songs are regularly licensed in the U . S ., this will greatly affect them , too .
That is why the Canadian Music Publishers Association ( CMPA ) released a joint statement with its American counterparts . Among other things , the statement says , “ The DoJ ’ s position will obstruct every level of the music business as songwriters ’ creative processes will be impacted by which PRO their cowriters are signed with . In a world where songwriters , artists , music publishers , and record companies are already being paid below market rates by tech companies that built their businesses by using our songs , the DoJ has opened the door for even lower payments . The DoJ ’ s decision reaches far beyond our shores and threatens our relationships with foreign writers , publishers , and record companies . The DoJ has now unwittingly entered the creative process in the writing room and the recording studio . They do not belong there .”
With that , Canadian Musician spoke with then-CMPA President Jodie Ferneyhough to learn more about how the DoJ ’ s decision could impact Canadian songwriters and publishers . ( Since this interview , the CMPA elected a new president , Vincent Degiorgio , and Ferneyhough is now VP of CMPA ’ s board of directors .)
CM : After two years of submissions from the music industry , do you know how the DoJ came to the decision it did ? JF : No , nobody really does . If you read everything that ’ s out there , there ’ s no real reason that they came up with . They can ’ t figure it out . I was just reading an article that it sounds like what they think is happening is that the DoJ may feel they are making it easier for the user , because it ’ s always about the user , so to me and from what I am reading – and I am speculating because I don ’ t know – but it sounds like they ’ re thinking , ‘ Hey , this makes it easier for the user to go to one company and get one thing and boom , you ’ re done ,’ which flies in the face of decades of good practices and two years ’ worth of articles and submissions and whatnot from lawyers and publishers and songwriters and everybody saying that this is going to be a disaster and the DoJ basically just ignored every submission .
CM : Who are the users the decision was meant to make licensing songs easier for ?
JF : This is mostly the Googles and Spotifys of the world . It may eventually trickle down to the performance dollars that are paid for by TV or radio or other broadcasters .
CM : Does this have a direct impact on Canada-based songwriters and publishers ?
JF : It does affect the Canadian publisher and songwriter for sure . The big reason is that when you sign to our PRO , which of course is SOCAN , you check off a box to say “ I want to go with either ASCAP or BMI .” So this will apply to your American portion of income . If you ’ re with ASCAP and they choose BMI to do the 100 per cent licensing and you get a higher rate with ASCAP , well you ’ ll receive the lower rate from BMI . Now if you ’ re signed to SESAC or GMR , which are not under the consent decrees because they ’ re for-profit organizations , your music and your money , frankly , can be put on hold while it goes through the process of figuring out who has it , to getting permission from that outside society , and eventually and hopefully paying you as a SOCAN writer .
CM : Publishers warn this could allow licensees to “ rate shop .” Does this put ASCAP and BMI in competition with each other to have the lower rate , meaning less money for their songwriter members whose songs are licensed ?
10 • CANADIAN MUSICIAN