@jemaswad: Senators Introduce American Music Fairness Act, Which Would Require Radio to Pay Royalties to Musicians [thanks to Senators @MarshaBlackburn and @AlexPadilla4CA] #IRespectMusic

[Introducing AMFA in the Senate is a huge thing and a major win by MusicFirst over the evil NAB and their $50 handshake. The bipartisan legislation has to pass both Senate and House to become law.]

Since the dawn of radio, the United States has been and remains the only major country in the world where terrestrial radio pays no royalties to performers or recorded-music copyright owners of the songs it plays — a situation that is largely due to the powerful radio lobby’s influence in Congress. While the more than 8,300 AM and FM stations across the country pay royalties to songwriters and publishers, they have never paid performers or copyright holders, although streaming services and satellite radio do.

On Thursday morning, Senators Alex Padilla (D-Calif.) and Marsha Blackburn (R-Tenn.) introduced the bipartisan American Music Fairness Act, which aims to rectify that situation by “ensur[ing] artists and music creators receive fair compensation for the use of their songs on AM/FM radio. This legislation will bring corporate radio broadcasters up-to-speed with all other music streaming platforms, which already pay artists for their music.”

Read the post on Variety

Do Songwriters Want the Cheese or to Escape the Trap in Phonorecords IV?

By Chris Castle

Here it is.  The US economic data is undeniably leading to a stagflationary outlook reminiscent of the 1970s.  If you don’t have first hand knowledge of the inflation that started under Nixon and Arthur Burns, burned through Ford and Carter and finally came to rest with Federal Reserve Chair Paul Volker and President Ronald Reagan that ultimately resolved in the low inflation that began trending downward in 1983, trust me; it was awful.  

This is why it is insane–if not actually cruel–to force songwriters to take a fixed five year mechanical rate with no downside inflation protection in the form of a cost-of-living adjustment. What is bizarre is that this just happened in the streaming mechanical for the Phonorecords IV proceeding, in case you didn’t hear it over the sound of the backslapping.

It appears that songwriters will get the cost of living adjustment (or “COLA”) on the physical mechanical side–you know, the one the smart people told us was unimportant–but failed to get it on the streaming mechanical side which the smart people tell us is critical to the continuation of life as we know it. Even though it certainly looks more likely than not that growth of the money supply and government debt produces the rocket fuel for the inflation that took 1200 points off of the DJIA in one day. 1970s all over again, including James Taylor crooning “Fire and Rain.”

But economists are beginning to remind us that what makes anyone think the 1970s is the worst it can get?  There’s a tendency to think of 1970s stagflation as a downside boundary.  It’s not.  It just happens to be the worst sustained economic times in living memory as the Depression-era Greatest Generation settles into the silence of old age.  However, there’s nothing magical about the 1970s. 

As it stands today, over 40 countries already have an inflation rate in the double digits, America is a debtor nation, Wall Street has sold a huge number of jobs off shore, productivity growth is lower than the 1970s and we’ve gone along with the central banks’ zero interest rate policies in the years since the 2008 crash.  The piper must be paid for the Lehman Bros. of this world leading us all over the cliff in the great recession, even though the central banks’ easy money policy has delayed that payback.  All of these are reasons why there must be a cost of living adjustment in any government imposed statutory rate that takes away bargaining rights. But wait, there’s more.

When Federal Reserve Chair Jay Powell changed the Fed’s inflation targeting (remember “transitory inflation”?), he blew an opportunity to start fixing the real problem.  But no more.  The chickens are coming home to roost with increases in interest rates and yet-to-materialize promise of quantitative tightening. Now that Mr. Powell was reconfirmed for another term.

If there’s even a chance—any chance—that 1970s style stagflation and depression-level demand destruction may be the best we can hope for, anyone setting a wage control like the statutory mechanical royalty rate simply cannot order that rate for five years and fail to take into account the potential for a coming inflation spike even if the smart people sign a suicide pact.  Yet this is exactly what just happened with the settlement of the streaming mechanical rates for Phonorecords IV at the Copyright Royalty Board.

Admittedly, the Copyright Royalty Judges are boxed in given the preference for voluntary settlements baked into the Copyright Act.  That gives the smart people far too much credit and fails miserably to allow the Judges to do what judges do—bring contemplative thought to the problem.  This is what judges do, it is not what lobbyists and their lawyers do.  But unless the public raises the failure to include a cost of living adjustment in comments, so far there’s little basis for the Judges to correct the defective settlement.

It is essential that the Judges are allowed to do their job outside the hurley burley of the commercial relationship with the biggest corporations in history whose lawyers are hell-bent on conducting a scorched earth litigation campaign to crush songwriters.  This is especially true of Google, Amazon and Spotify who have demonstrated truly vile behavior during the entire proceeding, a bully-fest beyond category.

George Johnson hit upon a potential solution in his recent comment. If one applies the COLA to the royalty pool after the mind-numbing “greater than/lesser of formula” created by those seeking full employment for lobbyists, lawyers and accountants, that’s actually a pretty elegant solution. I would quibble a little bit with the idea and apply the COLA as an uplift to the actual royalty statement so that the royalty recipients could see how that uplift was arrived at (which in theory would make them less likely to audit the MLC). That “show your work” approach would allow the payee to see how the MLC got there and make it easier to audit upstream for obvious mistakes.

It will also make it easier for the Judges to add the COLA because the building blocks of the calculation won’t change from the voluntary settlement (TCC, revenue share, etc.).

If songwriters are forced to stay in the confines of the statutory license trap, at least a COLA keeps the cheese from melting before their eyes. Plus they’re not required to guess today what the cost of food at home, shelter and gasoline will be five or six years from now.

The Judges would also have the opportunity to bring the services into a new era of fairness and wipe out the bullying of process as punishment that we all had to endure through two different proceedings.

Remember, as you have probably read or realized yourselves, all the US needs is one more good exogenous roundhouse shock to the economy (such as the world abandoning petrodollars for a basket of currency such as the ruble, the renminbi and the real to pick a few out of thin air), and we are in serious economic straights with hyperinflation as the real bugaboo.

Remember also that the US bonds pay interest at less than the inflation rate.

The decline of the dollar as the premier world reserve currency will put a stop to that interest/inflation spread practically overnight. The US government will not be able to borrow from a seemingly bottomless pit of lenders paying US dollars for US bonds at any price for the stability and transferability. What happens then? Probably interest rates will increase–a lot–to make it worth the lender’s money. Which means the debt service will take up an even bigger chunk of the US budget which will give us less to spend on the “Cross of Iron” weaponry that got us into the petrodollar business in the first place. And so it goes.

Songwriters may not be able to do anything tangible to stop cataclysmic economic events, but they can demand at least a bare minimum of downside protection through a COLA.

You may say, why so cynical? I’m not altogether cynical, I hope that I’m just cynical enough. The numbers don’t lie. If you know anyone who was a child during the Great Depression, or is the child of that person, ask them what it was like.

The overarching point is why would you want to take a chance and bet it all on the smart people?

The cheese or the trap. Which will you have?

Streaming Mechanical Complexity Begets Complexity Begets Legal Fees

Remember how the physical mechanical increased from 9.1¢ to 12¢? And it applies to each record sold? If a songwriter got a cut and the artist sold 100 records, the songwriter got $12. That’s $12 today, next month, six months from now. You could plan. You could complain about a statement to the record company. If the record company wanted you to write more songs for their artists, they’d listen and might even fix an error on your statement. Remember: On records and downloads, the record companies pay.

But what about streaming? The record companies don’t pay on streaming, Big Tech pays. The biggest corporations in the world pay: Spotify, Amazon, Apple, Google, Pandora, and their dozens of lawyers. Artist Rights Watch posted a series of Tweets that shows excerpts from the proposed regulations to calculate streaming royalties–and remember this is the one that we’re told is the important one, the one that dozens of lawyers spend millions in legal fees to come up with. It reads kind of like a drunk you can smell a block away but who sits down next do you and asks how do they look for three days?

The first think you realize is that unlike the 12¢ rate for physical, there’s no way anyone call tell a songwriter how much they’re going to make today or next year on a per play. They can’t even tell you how much you’re going to make today for a burger next Tuesday. Or Wednesday. Or Thursday. But one thing you definitely know is that the lawyers are going to make bank writing this crap, appealing this crap, renegotiating this crap. This section here is a big part of what the fight is all about, can you believe it? This is what the Big Boys and Girls think is important and you can understand why. It puts more legal fees on the table and you know who eventually pays for the legal fees one way or another? Take a look in the mirror.

And understand this: If you get a royalty statement for streaming royalties, take a look at the per-stream rate! It usually starts three or four or even five zeros to the right of the decimal place. It’s even worse than the recording royalty. And DIMA wants us to fight among ourselves against the record companies after all this?

David Brooks and @knopps Give The Other Side of Dynamic Pricing: Big Tech Scalpers

What we don’t like about dynamic pricing is that it’s necessary because of free riding scalpers and the artists get blamed.

Bruce Springsteen fans had a rough introduction to the world of dynamic ticket pricing Wednesday (July 20), as many logged into Ticketmaster’s Verified Fan platform to buy tickets for his upcoming tour with the E Street Band and experienced sticker shock at the cost of the best seats.

Those prices – which climbed into the thousands of dollars, as widely reported – represented about 1 percent of the tickets listed on the Ticketmaster Verified Fan sale, but they became a sore point for fans who felt that they no longer had a shot at great seats after years of loyalty to the Boss.

By selling high-priced platinum tickets, Ticketmaster argues, the company can prevent the best seats from being bought and resold by scalpers. That money can instead go to Springsteen. However, this only works when the tickets cost enough to prevent scalpers from making a profit.

Sources tell Billboard that early numbers show that less than 10 percent of tickets sold for the five concerts that went on sale Wednesday ended up on the secondary market – lower than average – and that despite complaints about four-figure prices, only 1 percent of tickets were above $1,000.

Read the post on Billboard

Judge Rejects Spotify’s Privilegium Regale Theory, Ek Must Be Deposed Under Oath

By Chris Castle

Judge Trauger rejected Spotify’s theory of privilegium regale that would have protected Daniel Ek from being deposed in the Eight Mile Style case against Spotify and the Harry Fox Agency. His Danielness will now have to submit to deposition testimony under oath in the case that seeks to show Spotify failed to comply with their Title I of the Music Modernization Act as drafted by Spotify’s lobbyists and the regulations overseen by Spotify’s head DC government relations person.

The Judge ruled that Spotify was pushing a theory that the relevant rules applicable to the deposition should be more deferential to high level executives. As a matter of law. That hasn’t been true since Magna Carta. (In 1215 for those reading along at home.)

Oopsie.

Needless to say but I’ll say it, it will be an absolute side splitter if Spotify ends up losing the safe harbor they drafted into US Copyright Law to protect themselves from songwriters seeking justice. And then there’s the HFA issue–you know, the ones that are backend for the MLC that can’t match $500,000,000 of other people’s money.

Stay tuned kids.

@davidclowery is back at the Supreme Court, this time with added Attorneys General

David is petitioning the Supreme Court of the United States to stop Google’s cy pres payola system of class action settlements. This is David’s third trip to the Supreme Court. This time, 21 state attorneys general agree. Read their friend of the court brief here. The Court has not granted a hearing yet, but we’ll be keeping an eye on it.

More to come on this topic.

Must See Documentary: The Way the Music Died: Why You Should #DitchSpotify

Big thanks to Jon at Camden Live for posting about this really important documentary about the deep, down and dirty effects of Spotify on music, musicians and the creative process.

It’s always been a hard road for musicians to make money from their songs. Nonetheless, selling tons of singles and albums was at least a target and something bands could dream about.  Of course, there were many ways the labels could work the sales figures to get their shares out first, and only then the bands might see something. Despite the conflict between the often industrial-strength labels and the upcoming artists, there was at least hope that money was flowing back to the content creators.  Now though in the age of streaming music, the connection between making music and making a living is profoundly broken.

This schism is the subject matter for Lightbringer Production’s documentary film “The Way The Music Died” featuring insights from musicians and industry pros, including Mishkin Fitzgerald from Birdeatsbaby.  The film probes the spirit of artists determined to keep writing songs in the face of the meager payouts from the giant and ever-growing music stream service Spotify. Find out why this is ripping-out the heart and soul of new music.

@davidclowery and @musictechpolicy Talk Copyright Royalty Board on Who Knew: The Smartest People in the Room

Big thanks to Tom Truitt and the wonderful audience!

David and Chris discuss improvements in the Copyright Royalty Board rules and procedures including:

–A songwriter advocate as a permanent independent representative of songwriter interests and participant in the Phonorecords proceedings with full rights of a participant. All other participants would bear the cost of the advocate. Other participants would be prohibited from using the advocate as a way to engage in overreaching discovery against individual songwriters or their publishers.

–Each participant would be limited to one lawyer representing their interests in the Phonorecords proceedings. This would counteract the current abuses forced upon the CRB and intimidation tactics of Big Tech.

–Songwriters would be permitted to form a bargaining collective with a general antitrust examption.

–Music users who appeal the Judges’ rulings must pay higher rates pending appeal.

–Discovery would be extremely curtailed to protect songwriters from abuses by Big Tech to punish and intimidate songwriters such as that currently being imposed by Google and other Big Tech companies without songwriter consent or even notification.

–Should songwriters get an across-the-board antitrust exemption under competition law (like the Sherman Act)?

@DavidCLowery: Address on Acceptance of the American Eagle Award from the National Music Council

June 2nd 2022 Anaheim California

Hello and thank you. Thanks to the board for this award. President James Weaver. Chair Charlie Sanders. Thanks to David Sanders for help with logistics.

And while I have him here, special thanks to Rick Carnes for his help a few years ago with the University of Georgia Artists Rights Symposium.

I wanted to start out today, by saying it is a great honor to receive this award.

When I look at past recipients and see names like Odetta, Dizzy Gillespie, Quincy Jones, Lena Horne, Hal David, Phil Ramon and Kris Kristofferson, I feel like the protagonist in the Talking Heads song:

“How did I get here?”

You see, my original claim to fame is the song Take The Skinheads Bowling. How did the guy that wrote that song end up amongst such musical luminaries?

By way of introduction and explanation:

The song Take the Skinheads Bowling is the first single from a band I started in 1983 in Santa Cruz California.

The band is called Camper Van Beethoven. And it’s still around after 39 years.

I would describe that band as a psychedelic folk-rock garage band but we didn’t have a garage. We actually rehearsed in an attic.

Three flights of stairs… SVT.

Go figure.

Around the same time I started an indie record label to promote and distribute the records of Camper Van Beethoven. We later signed to Virgin Records.

I then started another band called Cracker. This band went on to have platinum hits. You’ve probably heard a few.

I produced albums by groups like Counting Crows.

I ran a recording studio complex for many years.

And in 2012 I began to speak out on behalf of artists at various technology conferences.

In particular I wrote a rather long essay, quite controversial at the time, “Meet the New Boss, Worse Than the Old Boss?”

In this essay I argued that the emerging digital landscape for music was one in which the new bosses (mostly tech companies) would pay nothing up front for our work, and very little on the back-end. I predicted this would shift most of the financial burden and risk onto those who could least afford it, the working class artist.

Unfortunately, my predictions were correct.

Now, It is important to note I am not hostile to technology and technology companies per se. Indeed I graduated with a degree in mathematics from UC Santa Cruz, and before Camper Van Beethoven became my full time job I worked as a computer programmer.

In addition I have had some success as a seed investor in technology startups. Since we are at NAMM I assume you all have heard of Reverb.com?

Technology is important in my life. It’s important to how I make music. Most other artists I know feel the same way. I don’t think technology companies and artists should always be at odds.

So let’s rewind for a second…

“I started a band in my attic (not garage) and later a record label.”

The foundational myth of Silicon Valley is the garage startup that becomes a global brand.
(Think Apple).

Look at my own startup: Camper Van Beethoven. A few kids in a faded beach town start a band. With a small personal loan from a singing cowboy-true story- we made a record and went from the attic to competing on a global scale in a few short years.

In the 80’s and 90s, this story was replicated, to different degrees, by hundreds of indie rock bands all across The United States.

And this story is not unique to the US or rock music. In1990 while traveling around Morocco I met many musicians who sold their recordings on cassettes in souks all across North Africa, the Middle East and southern Europe.

In 2014 I toured China as a cultural and Intellectual property ambassador for the US State Department. I met a Mongolian folk-rock ensemble that was doing essentially the same thing across central Asia.

If Silicon Valley is widely hailed for its entrepreneurial energy and innovation shouldn’t artists and bands also be praised and seen in the same light? We are certainly as creative.

We generate jobs and substantial economic activity. Some political scientists even think it was really American Pop Music that ended the cold war.

It has always seemed like something worth protecting to me.

Turning our attention back to this room, I see a similar entrepreneurial spirit in the boutique amp, instrument, and music software makers represented here by the National Music Council.

Conversely the big manufacturers and major rights holders represented here have problems that will feel familiar to artists:

The unlicensed use of their intellectual property and designs.

We have a lot in common.

Now this award is ostensibly given to me for my work as an artists rights activist. But I want to put that in a bigger context.

Many of you may have first heard of my efforts on behalf of artists when I filed a class action lawsuit against Spotify for failing to pay self published songwriters.

This, indeed, was a milestone as it gave songwriters the first opportunity in the digital age to extract some concessions from digital services.

Also the 2018 Music Modernization Act may be understood as an unintended consequence of this lawsuit.

But in the big picture, this lawsuit was a minor skirmish in what I call “the long war” to protect the rights of the creators.

And In this long war, I submit, I am just a foot soldier.

I look at the members of the National Music Council, whether music creators, unions, manufacturers, music associations, labels, educators or performing rights organizations and I can think of many many times when I have been aided in my efforts by the good folks from these organizations.

Because ultimately, we have this in common:

We are all fighting to protect our intellectual property

our copyrights,
our neighboring rights,
our patents,
our trademarks
and our designs

We fight to protect them from freeloaders that too often convince policymakers and courts that in the name of “innovation” they should have access to our Intellectual Property without permission or payment.

Sadly this is nothing new. There have always been and there will always be unscrupulous schemers that claim their exploitative business model is somehow “the future.”

The problem is, that in their vision of “the future” they get rich while little of that money trickles down to us. Those that create the intellectual property.

To paraphrase Led Zeppelin: The scam remains the same.

But it is here that the National Music Council has always been helpful. The council and its members provide the long lasting intellectual infrastructure that allows individual artists like myself, to fight.

To fight Today.

To fight 5 years from now

and to fight into the foreseeable future.

I humbly accept this award as someone who has simply followed in the footsteps of other council members and award recipients.

Keep up the good fight my friends,

You are truly on the right side of history.

@DavidCLowery to Receive American Eagle Award at NAMM 6/2/22

[Big thank you to the National Music Council for recognizing David with their American Eagle Award.]

Dear Mr. Lowery,

I am writing on behalf of the Board of Directors of the National Music Council, which is well aware of your inspiring and longstanding work in both music education and the championing of music creator rights (especially in regard to ensuring fair remuneration to composers, songwriters and artists). In that regard, I am pleased to inform you that the opportunity arose today (as we sat in our board meeting at the BMI Offices in New York) for NMC to honor with you with its American Eagle Award for 2022.

Unfortunately, due to the exigencies of the pandemic, we are on an incredibly short timeline regarding the presentation of the Award at the NAMM Conference Dinner just two weeks from now (the NAMM Dinner on June 2 at 7pm in the Los Angeles area). It was unclear until today
that the Dinner Event would actually take place. Your transportation and lodging would be paid for by NMC, and the presentation would be made by your colleagues SGA President Rick Carnes and NMC Chair Charlie Sanders.

As you may know, the prestigious American Eagle Award is given each year to individuals who have made a truly significant contribution to the support, development and teaching of music in this country. Past winners have included Kris Kristofferson, Lionel Hampton, Dizzy Gillespie, Van
Cliburn, Benny Goodman, Morton Gould, Dave Brubeck, Marian Anderson, Lena Horne, Roberta Peters, Clive Davis, Hal David, Tom Chapin, Sesame Street Productions, Herbie Hancock, Quincy Jones, Roberta Guaspari and many other musical and educational luminaries.

The awards presentation will be the evening of Thursday, June 2nd. The ceremony will take place in Anaheim, CA. The ceremony will coincide with the NAMM show.