MediaNet Blog

Digest: Radio Royalty Battles Restart in Congress, SoundExchange Audits DSPs, Apple Moves iTunes to Ireland

Posted by Glen Sears | January 30, 2017 9:29 am | No Comments

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Top Story This Week

SoundExchange Issues Audit Notices for Many Digital Music Services
Federal Register notices have recently been issued to audit certain companies in various music spaces, including satellite radio, webcasters, broadcasters who stream, and business establishment services. While notices of these audits are public, the results are not. All that is publicly known is that a number of services will have to deal with SoundExchange’s auditors, who under CRB rules must be Certified Public Accountants.

Read the full story on Broadcast Law Blog

Other Music News Highlights

Radio Royalties Battle Lines Being Drawn With New Congress. According to the NAB, 115 members of Congress have signed the non-binding resolution, dubbed the Local Radio Freedom Act, which resists efforts by labels to gather royalty payments for radio play.

Apple Moving International iTunes Business to Ireland. Apple announced its intentions to move its iTunes business to Ireland in September when it transferred an estimated $9 billion of iTunes assets.

Sony/ATV Music Publishing Saw Revenues Grow 10% Last Year. While it’s true that Sony/ATV’s core UK company – Sony/ATV Music Publishing Ltd – saw revenues of £53m (+10.3%) in its last fiscal year, along with operating profits of £2.26m (-15.2%), further calculations give a fuller picture of the publisher’s commercial performance.

Sony International Boss Edgar Berger Exits After 12 Years. News of Berger’s exit comes in the same month we learned that Sony Entertainment CEO Michael Lynton – the figure ultimately responsible for Sony Music and Sony Pictures – is also out, leaving to focus on his role as Chairman of Snap Inc’s board.

Russia Permanently Blocks DailyMotion, Citing Copyright Law. The Moscow city court ruled that DailyMotion had repeatedly violated Russia’s copyright law by hosting shows from Russian TV network Pyatnitsya!, owned by Gazprom’s TV arm Gazprom Media.

Digest: Sprint Buys 33% of TIDAL, MusicFirst Lobbies Congress, YouTube Red Expanding in 2017

Posted by Glen Sears | January 23, 2017 9:21 am | No Comments

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Top Story This Week

Sprint Buys 33% of Jay Z’s Music Streaming Service Tidal
Sprint Corp. acquired a 33 percent stake in music-streaming service Tidal as the fourth-largest U.S. wireless carrier turns to media streaming to attract more customers with exclusive content.

Marcelo Claure, Sprint’s chief executive officer, will join the Tidal board and musician Jay Z will continue to run the business, according to a statement Monday. Financial terms of the deal weren’t disclosed. Sprint paid $200 million for the stake, according to a report in MusicBusinessWorldwide.

Read the entire story on Bloomberg

Other Music News Highlights

MusicFirst Coalition Pens Letter to Congress on Radio, Copyright Concerns. Dated Jan. 18, the letter outlines the group’s main aims in its pursuit of “market-based principles [that] drive compensation for all artists and creators whenever and however their music is played.”

CEO Susan Wojcicki Promises YouTube Red Expansion In 2017. “We’ll continue to roll out YouTube Red in new markets throughout 2017, giving creators another meaningful way to earn revenue from their content and fans access to brand new original series and films.”

Donald Trump Expected to Appoint Ajit Pai as New FCC Chairman. In his time at the FCC, Pai has been extremely vocal about his unhappiness with the agency’s heavy hand, and has signaled an intent to roll back the FCC’s “open internet” rules, also known as Net Neutrality.

Is Apple Getting Serious About Original Content? The iPhone maker is exploring producing original television shows and movies to turn its Apple Music subscription service into what Apple executive Jimmy Iovine described Jan. 14 as “an entire cultural, pop cultural experience.”

Have $9.99 Streaming Subscriptions Reached A Saturation Point? MiDIA Research’s Mark Mulligan wonders, based on the financially polarizing pricing structure currently being implemented by the streaming industry, if the number of customers willing to pay $9.99 has hit a saturation point.

Garth Brooks’ Ghost Tunes Folding Into Amazon Music. A digital and physical distribution platform billed as an alternative to iTunes that launched a little over two years ago, Ghost Tunes is apparently folding into Amazon Music.

Sony/ATV Responds Publicly To Paul McCartney Lawsuit. McCartney filed the lawsuit last week in the Southern New York District Court, claiming that Sony/ATV had repeatedly failed to confirm it would transfer US copyrights to the songwriter when the company’s legal rights expire.

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Industry News Recap: MIDiA’s 2017 Predictions, APRA Boosts U.S. Presence, Ticket Bots Under Fire from Congress

Posted by Glen Sears | December 19, 2016 10:00 am | No Comments

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MIDiA Research Predictions 2017: The Year Of The Platform

Story of the Week
“2016 was the year that video ate the world. 2017 will be the year of the platform, the year in which the tech majors will fight for pre-eminence in the digital economy, competing for consumer attention through formatting and distribution wars. Companies that are already using mobile Operating Systems to achieve global reach will take the next step, creating Mobile Life Ecosystems that both break out of the app silo walls and straddle them.

Facebook, Amazon, Tencent, Microsoft, Apple and Google/Alphabet will be the main players. 2015 was about parking tanks on each other’s front lawns, in 2016 shots were fired, 2017 will be all-out war. Artificial Intelligence (AI) and voice assistance will be key battlegrounds and indeed will form the glue of Mobile Life Ecosystems.”

Read a summary of MIDiA’s 2017 Predictions here

Top Music News

APRA Boosts U.S. Presence, Unveils Simplified Licensing System. The joint-venture development, announced Thursday (Dec. 15), follows the introduction of OneMusic NZ three years ago, a project which was “warmly welcomed” by licensees, APRA and PPCA note in a joint statement.

iHeartMedia Chooses to Pay Its Lenders Over Itself as Debt Continues. On Friday, $250 million “legacy notes” came calling, $57.1 million of which iHeart owes to its own subsidiary, Clear Channel Holdings, Inc—but, in an SEC filing, the company says it will only be paying outside creditors the $192.9 million it owes them.

President Obama Signs “Better Online Ticket Sales (BOTS) Act of 2016.” The U.S. Congress has passed and President Obama has signed a bill that outlaws all ticket bots, computer programs that enable ticket brokers to bulk purchase concert and event tickets, raising average ticket costs for millions of fans.

FCC Boss Tom Wheeler Resigns. With a Trump presidency looming, and the dismantling of net neutrality a seeming inevitability, Tom Wheeler, the boss of the FCC and long time defender of net neutrality, recently announced his resignation.

Spotify’s Acquisition Of SoundCloud Looks Like It’s Off. A source told TechCrunch that the company ultimately walked away because it feared that an acquisition could negatively impact its IPO preparation.

New SoundCloud Deal Protects DJ Mixes — But Not All of Them. “As a creator driven platform, we respect all creators, and therefore we respect the rights of all creators who request to have their content removed,” a new blog post on the Soundcloud site clarifies earlier remarks by Soundcloud Co-Founder Eric Wahlforss.

Snapchat Users Can Shazam Songs Without Leaving the Messaging App. Holding down anywhere on the camera screen within Snapchat will prompt Shazam to identify music playing nearby, launching a pop-up box that will allow users to retrieve more info, including lyrics, preview the audio, play a Vevo clip, or share.

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The (Somewhat Screwy) State of Music Copyright Law Right Now, From The Perspective of Congress

Posted by Glen Sears | October 12, 2015 2:46 pm | No Comments

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It doesn’t take a law professor to understand that musical copyright is a complex beast. Just look at all the artists up in arms about Soundcloud takedowns, or MediaNet’s own exploration of the dizzying spiral of music ownership. Copyright laws are always passed with the intention of protecting rights owners, but as time passes and new technologies arise these protections can have counterproductive consequences.

The Library of Congress’ own Congressional Research Service has identified these protection gaps in a 37-page report called “Copyright Licensing in Music Distribution, Reproduction, and Public Performance.” The report, authored by attorney Brian Yeh, outlines the basics of musical copyright law then identifies 4 major areas where copyright law needs to be updated to support the current musical ecosystem.

Any reader interested in the history of how copyright law came to be should take the time to read the first 16 pages of the report. Yeh does a masterful job of explaining how various facets of musical copyright work together, as well as providing the context under which various protections were instituted. The real meat of the report, however, starts at page 18. Here The CRS outlines the 4 major areas it believes copyright law should be updated for 2015 and beyond.

Federal Protection for Pre-1972 Sound Recordings

As recent news may have informed you, digital radio services are required to license sound recordings, but due to a loophole only those sound recordings produced after 1972. According to the report “such pre-1972 sound recordings constitute approximately 15% of all digital radio transmissions and would have provided about $60 billion in music royalties for recording artists in 2013, according to one industry estimate.”

While some states have taken it upon themselves to pass legislation to close this gap, there still exists no federal protection for the rights holders of these sound recordings. Two pieces of legislation, The Fair Play Fair Pay Act and the RESPECT Act, have been offered up to bolster protection for pre-1972 recordings, but both lack total protections for rights owners. In addition, the report states these measures could “have the effect of dissuading digital music services from including the ‘golden oldies’ in their music catalogs.”

Extending the Performance Right in Sound Recordings to AM/FM Radio Broadcasts

Despite extending public performance copyright protections to sound recording owners in 1995, these protections did not include AM/FM radio transmissions. “Thus, public performance of sound recordings through non-digital audio transmissions does not trigger any obligation on the part of the radio broadcaster to pay royalties to the sound recording copyright holder.”

In 2013 the Register of Copyrights testified to a House Judiciary Committee that Congress should extend “full” public performance rights to sound recordings in all types of transmissions. While the Fair Play Fair Pay Act would extend copyright protections to all types of broadcast, an opposing piece of legislation called the Supporting the Local Radio Freedom Act would direct Congress not to impose any new performance fees or royalties for over-the-air broadcasts of sound recordings by local radio stations.

Standards for Setting Royalty Rates for Public Performance of Sound Recordings

An entity called the Copyright Royalty Board calculates the royalty rate applicable to “compulsory” licenses by applying a standard that is specified in the Copyright Act. The Digital Millennium Copyright Act established different standards for the compulsory license depending on the type of digital service and whether the service existed at the time of the DMCA’s enactment.

“The Fair Play Fair Pay Act of 2015 (H.R. 1733) would require the Copyright Royalty Board to set performance royalty rates for satellite radio and cable music providers by applying the same ‘willing buyer/willing seller’ standard that the CRB currently uses in determining Internet radio webcasters’ royalty rates, instead of using the 801(b) standard.”

The Internet Radio Fairness Act was introduced in order to “level[] the playing field for Internet radio services” and reform the current royalty rate calculation system. However, organizations like SoundExchange oppose such legislation as they suspect it would cause services like Pandora to pay less in royalties than they do now.

Modification of Consent Decrees Governing Songwriter Performance Royalties

In 1976 performing rights organizations such as ASCAP and BMI were legislated to be subject to “consent decrees,” for fear that they would monopolize the royalty collection process. As such, all agreements with PROs must be submitted to the Circuit Court of New York to verify their veracity.

In June 2014, the U.S. Department of Justice’s Antitrust Division announced that it would initiate a review process to examine the operation and effectiveness of these consent decrees, after ASCAP, BMI, and other parties in the music industry raised concerns that the consent decrees have been unable “to account for changes in how music is delivered to and experienced by listeners.”

The Songwriter Equity Act, with support from a consortium of hospitality companies, seeks to help increase the performance royalty payments from PROs, which includes keeping consent decrees on the books.

What Does It All Mean?

Copyright law is a complex beast. The deeper you dive, the more complex it becomes. At the end of the day, the changes proposed by the CRS will only help so long as the technologies we use support these regulations, rather than circumvent them.

MediaNet believes that all rights holders should be paid for every play. We have created an end-to-end licensing, distribution, fulfillment, reporting, and payment system that ensures all payments are delivered to the letter of the law.

Like many large pieces of legislation, U.S. copyright law will never be “complete.” All we can do in the mean time is ensure that all rights holders are getting their fair share of payment for creative works.

MediaNet features the only digital music catalog that internally matches sound recordings directly to rights holders, ensuring maximum accuracy and industry-leading reporting. Want to talk about how MediaNet can power your music experience? Let’s chat!

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