Music Modernization Act Passes U.S. Senate

[UPDATED] The Music Modernization Act passed the U.S. Senate today on a unanimous voice vote. The bill now goes back to the House Of Representatives, where a very similar bill has already passed a committee vote. 

The 185 page Music Modernization Act had been cosponsored by more than 80 Senators and updates the music licensing system for the digital age. The bill includes the CLASSICS Act, legislation that guarantees artists and labels who recorded music before 1972 a federal right to be paid for those recordings when played by digital radio outlets. 

“As legendary band the Grateful Dead once said in an iconic pre-1972 song, ‘what a long strange trip it’s been.’ It’s been an epic odyssey, and we’re thrilled to almost be at our destination,” said  Mitch Glazier, President, Recording Industry Association of America (RIAA).

Key portions of the legislation via the RIAA:  

The Music Modernization Act  (H.R. 4706, S. 2334) is the most significant update to music copyright law for songwriters in a generation. The bill improves both how, and how much, songwriters are paid. The bill reforms Section 115 of the U.S. Copyright Act to create a single licensing entity that administers the mechanical reproduction rights for digital uses of musical compositions – like those used in interactive streaming models offered by Apple, Spotify, Amazon, Pandora, Google and others. It also repeals Section 114(i) and, consistent with most federal litigation, utilizes random assignment of judges to decide ASCAP and BMI rate-setting cases – two provisions that will enable fairer outcomes for songwriters and composers.

The CLASSICS Act (H.R. 3301, S. 2393) addresses one of copyright law’s most glaring loopholes: the lack of payment for the streaming of recordings made before 1972. Legacy artists who recorded music before 1972 are not entitled to be paid royalties under federal copyright law when their music is played on digital radio (think Pandora and SiriusXM). Many legacy artists are no longer able to tour in order to earn a living, so this unfortunate gap in the law has an enormous effect on their livelihoods. The CLASSICS Act would treat legacy artists the same way their contemporaries are treated. Notable: Pandora supports this bill, along with the Digital Media Association (DiMA), and the NAACP recently endorsed the legislation, among others. On Valentine’s Day, Rock n Roll Hall of Famer Darlene Love and Mary Wilson of The Supremes made a compelling case before Members of Congress and staff at a CLASSICS Act event on Capitol Hill (see footage here).

The AMP Act (H.R. 881, S. 2625) improves and simplifies the payment of royalties owed to music producers, mixers and engineers by allowing royalty collection/distribution organization SoundExchange  to directly pay these music creators. This formalized, streamlined process provides a consistent and permanent arrangement for studio professionals to receive their much- deserved payments for their contributions to the creation of music.

Market-Based Rate Standard For Statutory Licenses. The new bill would require a market-based rate standard for sound recordings for statutory licenses. This provision would allow the Copyright Royalty Board which sets rates for statutory services to consider the rates and terms that would have been negotiated in the marketplace between a willing buyer and a willing seller.