The problem is the music-streaming companies

Songwriters have a number of allies in the ongoing fight to update our nation’s horribly outdated music licensing laws. But after reading the recent post by CALInnovate’s Mike Montgomery (“Songwriters are fighting the wrong fight,” 10/5/15), it’s clear that he is not one of them. On what grounds can Montgomery, who represents technology industry interests, claim that he speaks on behalf of songwriters? 

As a songwriter elected to represent the interests of ASCAP’s more than 550,000 music creator members, I find Montgomery’s arguments absurd and grossly misleading. 

{mosads}Perhaps most troubling is Montgomery’s suggestion that when it comes to the royalties streaming companies pay through PROs like ASCAP and BMI, the payment system is so opaque that songwriters “don’t know where that money is going.” 

If Montgomery ever bothered to talk to an actual songwriter about these issues rather than putting words in our mouths, he would understand that songwriters know exactly where the money is going.  

We receive detailed quarterly statements from ASCAP showing exactly when and where our music was played and how much it earned, and any member who wants to can log in to view the same information online through a personal ASCAP member account any time. I know 88 cents of every dollar collected by ASCAP is paid out in royalties to me and my fellow songwriter and publisher members. The difference covers necessary operating costs, which enable ASCAP – which operates on a non-profit basis – to negotiate, collect and distribute royalties for me and half a million other members – things we simply could not do on our own. 

Bottom line: the problem is neither transparency nor what is being paid out to songwriters and other copyright holders by PROs, as Montgomery would have you believe; the real problem is how little is being paid into the system by streaming companies.  

Under the current system of antiquated laws, 1,000 plays of a song on Pandora, the largest music streaming company, is worth about a dime in royalties to songwriters, composers and publishers. That means it takes nearly one million streams, on average, for a songwriter to make just $100. A look at their annual report to shareholders and some simple math will show you performance royalties paid to songwriters through PROs like ASCAP and BMI represent little more than 4 percent of Pandora’s revenue.  

This inequity is something the Songwriter Equity Act seeks to address. But it is only the first step in much broader music licensing reforms that are urgently needed, as more and more consumers move away from owning music and toward streaming it. 

But Montgomery and the technology companies he represents are now lobbying hard to keep the rules that govern how our music is licensed stuck in the past for one very obvious reason: streaming companies are making a lot of money off an outdated system, in which they are able to pay songwriters less than fair market value for the right to use our work. 

Montgomery is right to note that songwriters are frustrated – but certainly not for the reasons he suggests.  

The future livelihoods of the people who create the music we all enjoy depend on meaningful music licensing reform. And it is my sincere hope that policymakers will take the time to actually listen to songwriters, rather than those who claim to speak for us, before deciding these issues.

Williams is an Oscar, GRAMMY and Golden Globe-winning Hall of Fame songwriter and president and chairman of the Board of ASCAP.


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