House Introduces Music Modernization Act

Rep. Hakeem Jeffries

A bipartisan group of congressmen introduced the MUSIC MODERNIZATION ACT, H.R. 4706, today in the HOUSE, including Representatives DOUG COLLINS (R-GA) and HAKEEM JEFFRIES (D-NY). Original cosponsors include Reps. PETE SESSIONS (R-TX), MARSHA BLACKBURN (R-TN), DIANE BLACK (R-TN), JOSEPH CROWLEY (D-Y), STEVE COHEN (D-TN) and TED LIEU (D-CA).

The bill reforms Section 115 of the U.S. COYRIGHT ACT to create a single licensing entity that administers the mechanical reproduction rights for all digital uses of musical compositions – like those used by streamers such as APPLE, SPOTIFY, AMAZON, PANDORA and GOOGLE. It also reforms Section 114 to improve the rate court process for ASCAP and BMI.

This new system ensures that songwriters are paid when digital music services use their music, improves transparency, provides for better royalty rates, and gives songwriters increased involvement in how mechanical rights are licensed. It includes the benefits of the previously introduced Songwriter Equity Act which addresses two significant inequities under current copyright law that prevent songwriters and music publishers from receiving compensation that reflects the fair market value of their work.

NMPA President/CEO DAVID ISRAELITE, ASCAP CEO ELIZABETH MATTHEWS, BMI President/CEO MIKE O'NEILL, NSAI President STEVE BOGARD and SONA Executive Directrors MICHELLE LEWIS and KAY HANLEY praised the bill, issuing the following joint statement: 

“We strongly support the introduction of the MUSIC MODERNIZATION ACT, which represents months of collaboration and compromise between the songwriting and tech industries. This legislation enables digital music companies to find the owners of the music they use and reforms the rate setting process for performing rights, ensuring that songwriters and music publishers are paid faster and more fairly than ever before.

“For too long, digital music services have taken advantage of the ‘bulk NOI’ process and often failed to find the correct creators to pay, and now – by working together – this bill ends this practice by creating a private-sector system where money will no longer be lost to inefficiencies and lack of information. The bill also improves how mechanical royalty rates are calculated by introducing a willing-seller/willing-buyer standard.

“On the performance rights side, the bill also replaces the current rate court system with the random assignment of judges used in most federal court cases, and allows the rate courts to review all relevant market evidence into the valuation of how songwriters are compensated.

“We thank Congressmen COLLINS and JEFFRIES for their leadership in striking this balance that improves and modernizes our outdated licensing system and gives songwriters the ability to be paid what they deserve across all platforms that use music, including the growing interactive streaming services.” 

NAB EVP/Communications DENNIS WHARTON added a note of caution on behalf of the country's TV and radio broadcasters, “NAB appreciates the constructive efforts of Reps. COLLINS and JEFFRIES, as well as industry stakeholders, on issues addressed by the MUSIC MODERNIZATION ACT. The bill is an important step towards resolving critical issues faced by songwriters, music publishers, and on-demand streaming services to the benefit of those parties. 

"However, NAB has serious concerns about unrelated provisions in the bill that may unjustifiably increase costs for many music licensees, including local radio and TV broadcasters, who otherwise receive no benefit from the legislation. NAB looks forward to working with the bill sponsors and impacted parties to resolve our outstanding concerns.”

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