Hello Songwriters, Are You Listening? - (part 3 of 3)
[ No. 54/55 - April/May 2001 ]
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Note: This column was split into two for publishing in EQ, hence its
#54 and #55 labeling for April and May 2001.
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Welcome to Round Three of our dig into the current state of online
music publishing. The last two months spent blundering about
web sites of the Big Three music performance collection societies
(ASCAP, BMI, SESAC) has taught us much about Frustration Management.
We're ready but a little shy about seeing what the National Music
Publisher's Association (NMPA), it's affiliate The Harry Fox Agency
(HFA), and the Recording Industry Association of America's (RIAA)
online tool SoundExchange have to offer us online. Let's start with
the RIAA's SoundExchange. What is it and what does it do? How can
it help me and why should I care?
Arriving at
<www.soundexchange.com>
we're greeted by a very low-key
design aesthetic, a little bit of text and some links. So far this
is very refreshing from the giant screaming, Tokyo-by-night design
of most corporate web sites. SoundExchange introduces itself as an
"organization of large, medium and small recording companies...dedicated
to making the process of licensing music and collecting royalties
as accurate, simple and fair as possible for all involved." Well,
that's good. But how does that rhetoric translate into real world
use? Are they in direct competition with the aforementioned Big
Three? Are they a shill for the recording industry? Touting a staff
of "music industry veterans, Internet strategists, technologists,
and royalty professionals" SoundExchange says it "licenses, collects
and distributes public performance revenue for sound recording
copyright holders within such digital channels as cable, satellite
and the Internet." Ahh. So it leans toward modern arenas of music
publishing. Well, a new approach is needed for sure. So, what are
they offering that other companies aren't?
Describing themselves as "over 280 companies and their 2100
labels...from artist owned labels to Sony, Universal, EMI, Warner
Music Group and BMG; Telarc, RAS, Zomba, Koch, Rounder and Naxos;
from classical to hardcore and every genre in between," SoundExchange
promises to "negotiate the best terms available for the use of your
music" and provides their services on a "non-exclusive" basis
(described as: "You are free to enter into "direct licenses" with
webcasters on such terms as you may decide."). This last is also
refreshing. Non-exclusivity goes a long way toward promising a
decent level of service. Too often exclusive contracts lead to the
"I've got you now and I don't care" business model. Think: power
companies. Of course, non-exclusivity, open competition and free
market capitalism at the level of The Public Trust is not guaranteed
to fix anything. Sigh. Where will it all end? But wait! To paraphrase
an old friend: "It's only music...there's no lives at stake."
SoundExchange wants to handle our publishing negotiations in the
New Media. What's in it for them? What do they have that the other
orgs haven't? In their favor, the service is free to "all sound
recording copyright owners." All that's necessary to join is to
read, fill in, sign and return the four small .pdf documents to
SoundExchange. The documents are all detailed logistical contracts
about where the monies will go and to whom. It's basic stuff. But
there is one bit that catches our FezEye. Within the Authorization
Letter is a portion of a sentence that reads: "you grant the
SoundExchange the nonexclusive right to license the public performance
of all of your sound recordings by means of digital audio
transmissions." Ok, that's what we've been given to understand
SoundExchange is all about. But the next portion of the sentence
tells an extra tale. It says, in addition to the rights granted
above, we also grant SoundExchange the right to the "...making of
phonorecords of all of your sound recordings, or any part thereof
(including the making of multiple such phonorecords of a single
sound recording)." Huh? SoundExchange is going to manufacture
albums? What does this have to do with the online music licensing?
Suddenly, like the "hot kiss at the end of a wet fist*", we remember!
SoundExchange is owned by the RIAA. The RIAA is the political
lobbying face of the Big Five, no Four.... is it three labels yet?
Anyway, it seems you can take the girl out of New Jersey, but you
can't take New Jersey out of the girl. Any spawn of the physical
recording industry is going to hold on to the ability to make
plastic versions of audio intellectual property unless and until
you pry that right from their cold dead fingers. Too bad. It seems
totally beside the point for SoundExchange to feel it necessary to
retain the right make CDs.
So, will they do anything about promoting our music? Or will they,
like most of the other big, slow music business companies in the
world, merely sit on their asses to see if our music is played on
the radio and streamed over the Internet, then cut a check (after
keeping a hearty portion for their "efforts"). Simply put,
SoundExchange desires to be the middleman between the digital use
of your music (e.g., webcasting) and the corporations (e.g.,
spinner.com) who wish to license it.
Webcasters take note: if you want to stream original sound recordings
over the Internet there are some things you need to know. A lot
of things actually. And, according to current law, you must do
them. For more information on what may happen if you fail to obey
the law, see the detailed list of legal repercussions at
<www.riaa.com/Copyright-Laws-2.cfm#fair>.
For an exhaustive
explanation of the current laws surrounding webcast licensing see:
<www.riaa.com/Licensing-Licen-3a.cfm>. Many of the latter page's
informational points are standard: loop length, number of repeated
performances within a given time frame, taking steps to limit the
ease of copying and subsequent unlawful distribution, etc. This is
a pretty decent resource on the convoluted nature of online music
rights, but keep in mind it's the RIAA's perspective of the law
and the DMCA (Digital Millennium Copyright Act) in particular. It
was inevitable, of course. If you play the music, the folks with
a finger in the pie want to taste the filling. There are some
exceptions. Creating "non-interactive" streaming programs over
three hours long seems to be all right to do for now, as long as
the above-mentioned laundry list of conditions are met.
So, who should sign up for this service? They're aiming for people
and organizations that own the master rights (the license) to sound
recordings. If these license holders wish to have the use of their
music in new media easily (and legally) paid for, SoundExchange is
here to collect the money. Publishing is not their bag. Though it's
never stated directly it would appear that SoundExchange plans to
pay license holders once a year but will collect fees from licensees
(webcasters, etc.) every month. That's good for them. They can
play with all that cash any way they desire and once a year the
license holder will get what's coming to them. Many questions remain
unanswered, do they also plan on policing illegal uses of work they
collect for? It would also be nice to know how revenue reports
break out and whether or not individual members can request audits.
As a rebuttal to SoundExchange's offer of online and digital music
rights management assistance, let's turn to a document published
online by a group calling itself The Music Managers Forum (MMF,
<www.mmf-us.org/newsite/>,
and watch out for the silly Flash intro).
MMF reminds us that SoundExchange, though styling itself an
independent entity, is housed within RIAA's offices and SoundExchange
employees are on RIAA's payroll. MMF feels this presents a conflict
of interest. MMF also mentions that fees for processing licenses
will be at the 20% level which is high-side for the industry
standard. More tellingly, MMF points out that distribution of
monies, as currently outlined on SoundExchange's web site, is on
a "trial basis" and the final outcome depends on government approval.
The MMF clarifies: "If the creative community is not offered a
choice (an entity other than SoundExchange), the MMF can only
conclude that artists are being offered direct payment by the RIAA
for the sole purpose of placating artists temporarily while
SoundExchange receives approval from the Copyright Office. The MMF
is quite certain that after the first year of the proposed program,
direct payment will disappear and it will be business as usual."
Strong words and plausible ones, and the MMF isn't alone in saying
them. The non-profit Future Of Music Coalition
<www.futureofmusic.org>
(FOM) is on the same page. FOM goes so far as to say they have "no
confidence in the RIAA's ability to represent the voice of musicians
or to collect and distribute artists' royalties from the major
labels who fund the RIAA." FOM "advocates for an impartial and
accountable organization to guard the value of artists' webcasting
royalties."
SoundExchange makes very clear that direct payment will be available
to artists from licensees. But does this promise mean anything?
Created from the record industry's political mouthpiece, SoundExchange
comes from a crappy precedent for equitable handling of songwriter's
fees.
The question remains: do webcasters and songwriters need SoundExchange?
There certainly is a need for fair managing of webcasting royalties
but the RIAA-sponsored SoundExchange doesn't fit the bill. Nice
looking web site, though.
Harry Fox Agency (HFA) &
National Music Publishers' Association (NMPA)
<www.nmpa.org>
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HFA isn't about licensing music for Internet use by end-users. It
is, however, relevant to the question: "Who do I get permission
from to record a cover of a song and put it online
along with the lyrics?" HFA lets you file paperwork to pay standard
rates for pressing a CD containing a cover song or songs. Here's
how to go about it.
Go to the NMPA web site and click on "HFA." From here click
"Licensing." From this page we choose "Make a Recording" from eight
choices. This takes us to a page called "Mechanical Licensing."
Getting permission to record and sell a cover of a song is about
acquiring the above-mentioned mechanical license. HFA is the clearing
house for just about every song ever recorded in America. How they
became this monumental musical monopoly is, no doubt, a fascinating
story of power and greed. Sadly we don't have the space for that
sordid tale here.
If you have a credit card and are making less than 2500
albums you can use the HFA online registration service at:
<songfile.snap.com/nonpro_search.html>. This will thread
you through the HFA song file database (to make sure you and they
agree on the song you're using). Lets search their database of
"over 2 million songs!" Results are quick. There's the song we
chose, along with a host of others that have similar titles. Next
to the song result is a small disc that, when toggled, highlights
which of seven options are available. "Lyrics," "Listen," "CDs,"
"Sheet Music," "License," Info," and "Other Recordings." Of these
seven, "Lyrics," "Listen" and "Info" are not highlighted. We click
on "CDs." Surprise! Here we are at Amazon.com. Wonder what Amazon
pays them for this link? No album match for our song but we're not
looking to buy anyway. Back to HFA and a click on "Sheet Music."
This fires us over to
<www.jwpepper.com>,
the "Pepper Music Network"
and a "no title found" message. Whatever. Wonder who's playing nice
with whom to have all sheet music inquiries linked here? But we
don't want sheet music either, we want permission. Actually, we've
always been proponents of the adage: "It's easier to get forgiveness
than permission." Of course, we also strongly believe in musicians
getting compensated for use of their music. We continue our search.
"Other Recordings" leads us to just that. Various musicians who
have recorded versions of the same song. After fooling
around with the song file database it's back to the form. We're
required the answer to these questions:
- a) How many recordings will you make
- b) Manufactured in what country (Must be manufactured in U.S.)
- c) Distributed in what country
- d) Which type of Organization do you represent
After answering these questions we get asked for credit card
info and, apparently, that's when we'll find out the fee. Sometime
after this transaction is completed we apparently will receive an actual
paper license in the mail.
If you do not have a credit card start at:
<www.nmpa.org/hfa/mechanical.html#forms> and download the
two .pdf documents: "Mechanical License Request Form" and "Application
for New Licensing Account." These documents must then be printed
on "plain white paper" with "only typewritten or neatly printed,
block letter style requests accepted." Then you must mail or fax
the forms to HFA.
A separate license (and an additional fee) is required for reprinting
lyrics of the cover song with your CD. HFA doesn't handle this
sort of licensing (probably too much overhead for them to make
enough money) so they note that: "For these rights, you must contact
the publisher(s) directly." It's great for smaller artists to have
a direct connection to arrange this kind kind of license, but we
shudder at the thought of quickly getting lost in a mega-corporate
bureaucracy negotiating a license for Led Zeppelin's "The Crunge"
with Atlantic Records. Where's that confounded bridge, indeed!
The good news is the mechanical licenses aren't very expensive for
low run CD pressings, maybe the price of a tank or two of gas per
song. The question is: how much of this money makes it into the
pocket of the songwriter or rights holder? If only it were as
straightforward as a biologist injecting a radioactive tag into
the bloodstream to trace its path. In the meantime, the best we
can offer is a link to HFA's "Royalty Payments Inquiry Form", which
you presumably need to be a member owed dues in order to fill out:
<www.nmpa.org/forms/royalty_inq1.cfm>. Of course that means
you need to sign on the dotted line to find out what you may or
may not be paid! This is becoming so typical...
HFA's online services also offer a secure proprietary system for
professional organizations (like record companies) that we'd have to apply
to join by submitting a request on company letterhead and faxing or mailing
back to their office in New York. We don't have
to worry about that if we're only pressing 2500 copies or less.
The options for buying, selling and granting licenses for music use online
(what few there are) don't feel like simplification. The vibe here is
merely more examples for the already weighty processes by which these
organizations do their business. Without being a royalty professional,
having a law degree in intellectual property rights or a lot of time and
long experience in parsing the jargon of music publishing a webcaster or
songwriter may well need to hire outside help. But if you're patient and
focused, it can be done. Yeah, you may feel lost in a hideous vortex of
language and law but take heart...Internet use is causing even these
constipated organizations to rethink their way of doing business and, while
the precedent has been problematic, the future holds promise!
As first reported in FezGuys #007, this is still a darned good resource:
<www.music-law.com>.
A very practical Q&A series. Recommended.
For all things government-related to the subject:
<lcweb.loc.gov/copyright>
The final word.
The Fezguys welcome information, invective and ideas.
<www.fezguys.com>
* - with apologies to the Firesign Theater
