DOJ to review decades-old music licensing rules

The Department of Justice has kicked off a process to review its decades-old consent decrees with the music industry’s largest licensing organizations.

The move was applauded by the two organizations — Broadcast Music, Inc. (BMI) and the American Society of Composers, Authors and Publishers (ASCAP) — who have protested the decrees, saying that the Justice Department’s rules to protect competition in the music licensing market have not kept up with changing technologies.

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“The Department understands that ASCAP, BMI and some other firms in the music industry believe that the Consent Decrees need to be modified to account for changes in how music is delivered to and experienced by listeners,” the Justice Department wrote in its announcement of the review. 

“The Department’s review will explore whether the Consent Decrees should be modified and, if so, what modifications would be appropriate,” it said, directing commenters to file via the agency’s website or mail by Aug. 6.

The agency’s rules for BMI and ASCAP date back to the U.S. government’s concerns in the 1940s that the music industry’s two largest licensing organizations — which sell blanket copyright licenses to those looking to play the music publicly, such as television stations and restaurants — were acting in anticompetitive ways.

But BMI and ASCAP — whose consent decrees were last updated in 1994 and 2001, respectively — say the rules haven’t kept pace with changing technology, including the proliferation of Internet radio services like Pandora, depriving songwriters and publishers of fair compensation.

“Technology has truly helped democratize the entertainment industry, giving large and small players a forum to be heard over any device — but the creators of the music must be paid properly and fairly for their contributions,” BMI CEO Michael O’Neill said in a statement welcoming the Justice Department’s review of the consent decrees.

“BMI understands that the focus needs to be on the songwriters, composers and publishers responsible for the music we all enjoy, on the businesses using our music, and on serving the ever-growing public demand for music,” he said.

“We seek to modernize the decree to enable songwriters and publishers to realize fair market value for their work, to make music licensing more efficient and to streamline the rate-setting process.”

In a statement, ASCAP President Paul Williams said his group is “gratified” by the agency’s actions and noted that the last review of ASCAP’s consent decree in 2001 came “before even the iPod was introduced.”

“ASCAP members' music is now enjoyed by more people, in more places, and on more devices than ever before,” he said. 

“But the system for determining how songwriters and composers are compensated has not kept pace, making it increasingly difficult for music creators to earn a living.”