In today’s day and age, it has often been difficult for the law to keep up with the ever-changing landscape of the Internet and new technological innovations.  The music industry especially has been critical of the way copyrights are enforced and policed, often having to rely on suing universities or internet service providers on theories of contributory or secondary liability to enforce their copyrights or block piracy. This all may finally be changing, however, as Senate overwhelmingly passed the Music Modernization Act with a unanimous vote earlier this month.

The Music Modernization Act is on a Fast Track to Revolutionize Copyright Law

The House is expected to quickly approve the bill with the intention to fast track the bill to the White House by the beginning of October. If made into law, the Music Modernization Act would mark the first revolution in copyright law, being the first to truly address technological innovation since digital music has become available. At its core, the Music Modernization Act would rewrite how songwriters are paid when their music is licensed or even played.

The bill would also correct an often-exploited loophole that currently allows artists to not be paid royalties for songs that were recorded before 1972. It would also provide specific procedures for how digital music is to be streamed and would limit the liability that streaming services can incur, providing specific safe harbors if particular conditions are met.  Additionally, it would install a new evidentiary standard by which licensing organizations can use to argue for better royalty rates.

Proposed Changes Include a Governing Entity and Blanket Digital Licenses for Streaming Services

Proponents of the legislation also laud that the Music Modernization Act proposes to create a separate governing entity, overseen by songwriters and music publishing companies, that would guide how the royalties are to be paid out for songs played on the Internet.  This entity would also help build a formal database and catalog of music that oversees the royalty rates for specific songs.

Services that provide music through streaming platforms like Spotify would be required to obtain blanket digital licenses, written specifically to address digital streaming.  This new license is aimed at providing some compromise between the music industry and streaming services, which currently are embroiled in seemingly never-ending rounds of litigation and arguments over the proper amount of royalties to be paid.

Critics of the Proposed Music Modernization Act Include Independent Songwriters and Satellite Radio

The bill, despite its intents and purposes however, still has some critics.  For example, independent songwriters are already on record with complaints that the bill would give too much power to popular songwriters and music publishing companies without giving smaller shareholders representation.

SiriusXM also criticized the bill for requiring satellite radio to pay royalties for songs before 1972 while traditional radio stations would not be required to do the same.  Despite this complaint, however, SiriusXM ultimately ended up endorsing the bill after being allowed to keep their royalty rates for almost another decade. In the end, while the bill still may not be perfect, it appears to be a major improvement over the patchwork of laws currently relied on for copyright protection.  The fast movement by Congress to finally address digital rights is a welcome change as technology continues to press forward at such a relentless pace.

For more information on this topic, please visit our copyright protection service page, which is part of our Software & Copyrights Practice.  Also available is this article on a music industry battle with ISP over copyright infringement.

About the firm:

Klemchuk LLP is a litigation, intellectual property (IP) and transactional law firm, located in Dallas, TX.  We offer comprehensive legal services including litigation and enforcement of all forms of IP as well as registration and licensing of patents, trademarks, trade dress, and copyrights. The firm also provides a wide range of technology, Internet, e-commerce, and business services including business planning, formation, and financing, mergers and acquisitions, business litigation, data privacy, and domain name dispute resolution. Additional information about the IP firm and its IP attorneys may be found at www.klemchuk.com.

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