Music Modernization Act – How it affects the Artists & Digital Webcasters

 

 

 

 

 

By Cliff Broyhill – BWNR Owner/Operations

On October 11, 2018, the Orrin G. Hatch–Bob Goodlatte Music Modernization Act was signed into law in the US.

Besides, the obvious changes to how pre-1972 recordings are treated(more on that in a minute), it also changes things for producers & how royalties actually reach you unless you have a direct licensing agreement – like it is when you join Spotify as an artist. It also guarantees that the corporate broadcasters HAVE to pay you royalties through Sound Exchange.

This doesn’t just affect US artists but also ANY artist aired on ANY online webcaster radio stations from iHeart all the way down to little old Bandwagon Network Radio (my reason for needing to hold a $500 fundraiser every January) if broadcasting from the USA. Podcasters are not webcasters so the same rules do not apply to them unfortunately.

Here’s the basics:

Pre-1972: Previously, under the old rules, any song created prior to 1972 was allowed to be aired WITHOUT having to pay royalties. Remember, this means any time you see a movie using “oldies”, them guys didn’t have to be paid. Now you do and they even ruled that webcasters and anyone else that aired them had to pay retroactively back to 2015. If you send BWNR any covers, I probably won’t be able to play them without a lot of information from you.

Producers: changing how producers and publishers get paid. They will now be included in the “per play” royalty like the artists and musicians.

Webcasters and streaming sites: A lot of changes regarding how artists collect their royalties. All songs will be put in a database to ensure that the correct people get paid for their part of the online performance.

WHY SOUND EXCHANGE?

Registering is Free!

Directly from the US Copyright office article:

“….royalties collected for uses of sound recordings under the section 114 statutory license by codifying a process wherein the collective designated to collect and distribute royalties (currently, Sound Exchange)…….”

In other words, if Sound Exchange doesn’t get it, nobody does. Unless, again, the webcaster makes a direct licensing deal with you; pretty much what the big labels do. And that’s what Spotify does when you agree to their service even though they may not mention it that way when you sign up.

BMI & ASCAP handle LIVE performances – not airplay. This is why you need to provide as much information you can to whoever you send your music to for airplay. With the most important piece of information to protect YOU being the copyright holder of the song you recorded.

The songs you created and sent to me for airplay are in their database because when I pay my royalties, they are added automatically. However, you don’t receive them unless you are registered. That database ties them to your songs and is what they use to put them in your SE account.

ISRC: The International Sound Recording Codes are now very important – more so going forward. These were created so that you, the artist, can protect your rights to your creation. Here’s how the royalties are broken down: 55% goes to the person(s) who recorded it, 45% goes to the Publisher(or Label) who holds the copyright to the work.and 5% goes into a pool for studio musicians.

Final Thoughts:

I can’t encourage you enough to thoroughly research these changes as they have all been made to protect the creators and not the labels, webcasters and podcasters. Since I believe in supporting the music over profits, (BWNR has never made 1 penny of profit) I think this is a fantastic new copyright law. If you are part of Sound Exchange now, things could finally be changing for the better. Multiple changes are coming to how the collect, pay and enforce the law. If you aren’t a member, even if you do not live in the US, join today. I plan on following this news closely over the next few months and keep everyone as informed as I can.

 

HINT: create your own label on SE as well. It doesn’t have to be a legal entity to the best of my knowledge (i.e. don’t use “Independent” as your label name; research my “create label” opinion too). Consider getting ISRC numbers for your individual tracks AND the Album/EP. If it’s important to you to make sure and collect royalties, confirm the webcasters/podcasters are registered to broadcast because it’s the LAW in this country & it benefits everyone.

Feel Free to leave your on topic comments

 

Sources:
https://www.copyright.gov/music-modernization/
https://www.ascap.com/about-us/stand-with-songwriters
https://www.bmi.com/news/entry/bmi-explains-what-the-music-modernization-act-means-for-songwriters-and-com
https://www.soundexchange.com/

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