A Response to A2IM’s Objection to the New Statutory Mechanical Rates: Part 2

By Chris Castle

This post first appeared on MusicTechPolicy, continued from Part 1

The American Association of Independent Music, the independent label trade association, filed comments with the Copyright Royalty Board opposing increasing the mechanical royalty to songwriters from the “frozen rates” to the 12¢ (plus cost of living adjustment) settlement rate of the participating record companies with the NMPA and NSAI. I wrote a reply to the A2IM comment that was timely filed with the CRB–barely. I will repost that comment in a few parts here on MTP. As I had about 10 minutes to write the comment due to the lateness of the A2IM filing, I will add some bracketed language to make it a bit less inside baseball.

Unfortunately, A2IM chose not to participate in the Phonorecords IV proceeding and came in a bit late to the party complaining of the check. Nobody stopped them from participating; it appears they put it all on red and it came up black. This is important because unlike independent songwriters who cannot afford the cost of participating at the CRB hearings, A2IM could have participated but chose not to.

As I told the Judges in my comment, I will focus on a few issues raised by A2IM regarding the CRB settlement process in general, the penny rate structure of the mechanical royalty system in the United States, and their proposal that mechanical licensing for physical configurations be handed over to the Mechanical Licensing Collective.

The Longer Table

I actually was pleased to join A2IM at their annual Indie Week conference recently in New York on a panel devoted to this very topic.  I am well aware that they believe their members will be disproportionately affected by the increase in cost although I have not seen the data.  After many years in the music business, I will take on faith for purposes of this letter that they are correct.

I completely concur that the negotiation process for CRB needs a relook if not an overhaul.  I made the point on the A2IM panel that David Lowery and I intend to host a conference devoted largely to this subject [on November 15] at the University of Georgia at Athens.  Dr. Lowery and I are both of a mind that this issue needs to be vetted by the Copyright Office in their roundtable format.

However, I do not concur that the Subpart B resolution should be derailed at the 11th hour because of these structural issues that lawmakers no doubt will need to resolve.  The time for A2IM to have made their views known in Phonorecords IV has long passed.  They had the opportunity to participate in the proceeding, which individual songwriters could not afford to do, and they did not.  They had the opportunity to comment on the first and second comment periods for what became the rejected settlement and they did not.  They had the opportunity to insert themselves in the second settlement and appear not to have done so until filing a comment on the last day at the 11thhour.

Derailing the settlement for this purpose at the 11th hour is inappropriate.  Whether the Judges can even accomplish what is asked of them, I respectfully leave to Your Honors to decide, but I do think there’s a question of authority here.  I do support including all these topics being on the table for Phonorecords V as do many other commenters.

What is the Actual Cost to Labels of the New Rates?

While I am prepared to take disproportionate impact on faith, I am less prepared to take disproportionate financial impact without more data.  There is an assumption that A2IM labels all will have a one-to-one increase in costs because of the new rates, whatever they end up being.  I’m not so sure about that and would want to know a few things including the following.

Many indie labels operate on a revenue share basis with their artists (or licensors).  In those revenue share deals, the artist or licensor is paid a percentage of revenue that includes all mechanical royalties.  In that structure, the new rates have arguably zero impact on the [independent] label.

Because of rate fixing dates in deals [with controlled compositions clauses] where the label does pay the mechanicals, the new rates would only apply to records delivered during the rate period, i.e., after January 1, 2023.  Term recording artist agreements would typically include a controlled compositions clause as the Judges have noted in the Withdrawal Notice.  In such an arrangement, the label would be paying a modest increase and could easily tell the artist that unless the artist-songwriter agreed to take still lower rates based on the previously frozen rates, the label would be unable to release their records.

A2IM does make a good point about the bull-headedness of the DSPs on permanent download rates.  Perhaps the Judges could refer this issue to the Register for subsequent referral to the Department of Justice Antitrust Division to investigate these pricing practices.  Congress seems focused on these kinds of issues at the moment.

[It is unfair for A2IM to complain of being excluded from settlement negotiations by the labels who did participate in the proceedings and who did negotiate a settlement with the NMPA publishers who also participated in the proceedings. Participating in the proceedings is a threshold condition for participating in a settlement of the proceedings. It’s hardly the case that the major labels conspired against the indies this time. If A2IM labels were concerned about being included in these negotiations there are a number of steps they could have taken, starting with participating in the bifurcated Subpart B proceeding–a much less expensive proposition than the streaming side.

There is also a threshold question–that A2IM does not really address–as to whether the CRB has the authority to unilaterally change U.S. mechanical licensing structure that Congress initiated in 1909 and has been based on a penny rate ever since, not to mention hundreds of thousands of term recording artist agreements and licenses incorporating those statutory rates. The entire US recording industry is built on statutory rates and controlled compositions clauses, not to mention the valuations of music publishing catalogs. 

That change requested by A2IM is a question of such “magnitude and consequence” that it should require Congress to act based on both the CRB’s statutory authority, the U.S. Supreme Court’s recent holding in West Virginia vs. EPA as well as common sense. Not to mention there are other reasons why getting a CRB case before the Supreme Court could backfire and disrupt a process that in other important ways is working quite well.]

A Response to A2IM’s Objection to the New Statutory Mechanical Rates: Part 1

By Chris Castle

This post first appeared on MusicTechPolicy

A2IM, the independent label trade association, filed comments with the Copyright Royalty Board opposing increasing the mechanical royalty to songwriters from the “frozen rates” to the 12¢ (plus cost of living adjustment) settlement rate of the participating record companies with the NMPA and NSAI. I wrote a reply to the A2IM comment that was timely filed with the CRB–barely. I will repost that comment in a few parts here on MTP. As I had about 10 minutes to write the comment due to the lateness of the A2IM filing, I will add some bracketed language to make it a bit less inside baseball.

Unfortunately, A2IM did not participate in the Phonorecords IV proceeding and came in a bit late to the party complaining of the check. Nobody stopped them from participating; it appears they put it all on red and it came up black.

As I told the Judges, I will focus on a few issues raised by the American Association of Independent Music regarding the CRB settlement process in general, the penny rate structure of the mechanical royalty system in the United States, and their proposal that mechanical licensing for physical configurations be handed over to the Mechanical Licensing Collective.

The Clean Slate

A2IM raises the idea of compensating songwriters on a percentage of wholesale basis which is how mechanicals are paid in many if not most other countries.  I understand why labels favor this structure but I also understand why publishers and songwriters do not.

First, I am of the view that a percentage of wholesale royalty is incompatible with a compulsory license.  [To my knowledge, the European countries operating on a percentage of wholesale basis do not have a compulsory licensing regime.] Imposing a compulsory obligation to have a third party set the “just compensation” for rights the government takes from the songwriter has that unconstitutional ring to it [see 5th Amendment and Takings by Prof. Richard Epstein, an oldie but goodie].

And that really is the problem with a percentage of wholesale royalty—it allows the conflicted record company to call the tune [for songwriters] which is the very definition of moral hazard.  Having said all that, I am happy to have a conversation about a clean slate and reimagining of the entire structure as long as it really is a clean slate.  Of course, that will mean throwing away the entire controlled composition structure.

It must be said that in countries with a percentage of dealer price mechanical royalty there [are] no controlled composition terms at all.  So if we are to have the discussion, let’s have all the discussion for all the record companies including catalog.  If we want to be like Europe, let’s be European.

We cannot overlook that changing that compensation system will throw royalty compliance examinations of every record company onto the table with great force.  How can songwriters be asked to give up a system that has been in place since 1909 without knowing whether they have gotten a straight count heretofore?

It must also be said that if A2IM members feel justified in changing the entire U.S. mechanical rate system, there is nothing stopping them from creating such terms in their new signings under controlled compositions clauses.  In fact, such arrangements might be a good laboratory to experiment with these alternative structures.

[To be continued.]

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?

@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)?

Save the date: A2IM Indie Week Panel with @musictechpolicy on the Impact on Indie Labels of Unfreezing Mechanicals

If you are coming to Indie Week, Trichordist readers might enjoy a panel Chris Castle is on to discuss the impact on indie labels of the Great Unfreeze! 

Entitled How the CRB’s Rejection of Frozen Mechanicals Will Affect Your Label?, the panel goes off at 10:30 am ET on Wednesday, June 15 at the New York Law School.

Speakers are Victor Zaraya: Concord (Moderator), Danielle Aguirre: NMPA (National Music Publishers’ Association), Glen Barros: Exceleration, and Chris.

If you want to read up on the issues that caused the Copyright Royalty Board to reject the failed settlement, here’s some background:

Copyright Royalty Board’s Rejection of NMPA, NSAI, Sony, Warner, Universal settlement

Copyright Royalty Board’s Reaction to Second Settlement Proposal by NMPA, NSAI, Sony, Warner and Universal

Survey Results from Songwriter Survey on Frozen Mechanicals

Comments:

Rosanne Cash

Helienne Lindvall, David Lowery, Blake Morgan

David Poe

Abby North, Erin McAnally, Chelsea Crowell

Kevin Casini

NMPA, NSAI, Sony, Warner, Universal Comment with Copy of MOU4

Chris will post about the panel afterward.

@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.

Series 3 of the @ArtistRights Watch Podcast is here! Nik Patel, @DavidCLowery, @MusicTechPolicy and @KCEsq Discuss The Future of Frozen Mechanicals — Artist Rights Watch

Series 3 of The Artist Rights Watch Podcast is here! Nik, David, and Chris are joined by attorney Kevin Casini to talk about the latest with the Copyright Royalty Board and mechanical rates in the Phonorecords IV proceeding and discuss alternatives so songwriters are better represented at the CRB compared to the status quo. 

Check out the podcast here!! Available on all platforms! 

ARW Podcast S3E1: Unfreezing Mechanicals show notes

On the this episode of the Artist Rights Watch, Nik, David, and Chris sit down to talk about the recent developments with the CRB and mechanicals with lawyer and advocate, Kevin Casini. The Copyright Royalty Board who herein will more than likely be referred to as the CRB, ‘is a US system of three copyright reality judges who determines rates and terms for copyright statutory licenses and make determinations on distribution of statutory license royalties collected by the US Copyright Office.’ The US mechanical royalties are determined by the CRB and they meet every 5 years to determine the rate. Songwriter groups argued for a higher rate, and the CRB agreed. On March 29, 2022 the CRB agreed to unfreeze the $0.091 mechanical royalty rate which would commence a fight for a new rate in the 2023-2027 period. Over the past few years, there has been numerous criticisms about the constant rule for freezing the mechanical royalty rate. The royalty rate currently is $0.091 which was set back in 2006, and frankly, songwriters are making less  money due to economic inflation.

Show Notes and Background Materials

Copyright Royalty Board’s Rejection of NMPA, NSAI, Sony, Warner, Universal settlement

Survey Results from Songwriter Survey on Frozen Mechanicals

Selected Frozen Mechanicals Comments:

Rosanne Cash

Helienne Lindvall, David Lowery, Blake Morgan

David Poe

Abby North, Erin McAnally, Chelsea Crowell

Kevin Casini

NMPA, NSAI, Sony, Warner, Universal Comment with Copy of MOU4

Below are some links about Guest Kevin Casini:

Tweets by KCEsq

https://kcesq.medium.com

Below are some links for further reading:

https://completemusicupdate.com/article/us-copyright-royalty-board-rejects-proposal-to-keep-mechanical-royalty-on-discs-and-downloads-unchanged/embed/#?secret=CDnkY1xuT7#?secret=GoUJkY3oLr

https://variety.com/2022/music/news/copyright-royalty-board-crb-rate-1235219872/

https://musictechpolicy.com

https://www.crb.gov

https://variety.com/2022/music/news/songwriters-win-copyright-royalty-board-mechanical-royalties-1235259518/ 

https://www.musicbusinessworldwide.com/record-labels-and-publishers-ink-major-settlement-moving-from-9-1-cents-to-12-cents-per-track-for-us-mechanical-royalties-on-physical-sales1/

Below are our social links and terms of use:

Chris: http://www.christiancastle.com/chris-castle

David: https://twitter.com/davidclowery?s=20

https://www.instagram.com/davidclowery/

Nik: https://www.instagram.com/nikpatelmusic/

www.nikpatelmusic.com

Website: https://artistrightswatch.com

Facebook: https://www.facebook.com/artistrightswatch

Twitter: https://twitter.com/ArtistRights?s=20

Terms of Use: https://artistrightswatchdotcom.files.wordpress.com/2021/01/arw-podcast-terms-of-use-v-1-i-1.pdf

Intro/Outro song: “All My Years” by Nik Patel

Survey Results: Physical and Download Mechanical Rates Survey–Artist Rights Watch

Many readers participated in the Physical and Download Mechanical Rates Survey that various organizations have sent to their members over the last few weeks. Here are the results of the main questions for which we had 361 respondents who self-selected their participation. (Other answers included comments which we chose not to publish for privacy reasons.). 

The results suggest that participants were mostly informed songwriters who had never been asked before what they thought about the issues in the Copyright Royalty Board. We would have to conclude that any of our regular readers would be a bit skewed toward knowledgeable because between the Trichordist, MusicTechPolicy, ARW, Hypebot and Celebrity Access we were probably carrying a very high percentage of the available information on the frozen mechanicals issues.

It also is striking how few respondents said they had ever been asked what they think about any mechanical rates (physical, download, streaming), an important and easily measurable issue. This is something to add to the learning from this episode. It may be that our data is skewed, but even so we didn’t expect that 68% would say they’d never even been asked their opinion. An easy way to find out what people think about something is to ask them. 

A new proposal for songwriters in the Imperial City

[This post first appeared on MusicTechPolicy]

By Chris Castle

As MTP readers will recall, the National Music Publishers Association and the Nashville Songwriters Association International purported to agree on behalf of a “consensus” that never seemed to materialize to extend the long-frozen 9.1¢ mechanical rate for physical and downloads in the form of a settlement agreement in the Copyright Royalty Board’s Phonorecords IV proceeding.  I thought this deal reeked and so did a number of other people, including the Copyright Royalty Board itself which rejected the settlement.

To their great credit, Sony, Universal and Warner stepped up and agreed to offer all the world’s songwriters increased rates of 12¢ plus inflation indexing for the next five years which they didn’t have to do (and was a deal that the CRB hinted that they would find acceptable when they resoundingly rejected the first settlement).  Assuming the Copyright Royalty Board accepts the deal—a step you might miss out from the press coverage–this had the effect of a quick end to a process the labels had every right to litigate at the CRB.

The other benefit to the settlement is that it should—if it doesn’t get screwed up again—it should take away a major argument that the digital retailers are using against songwriters in the streaming part of the Phonorecords IV proceeding.  That argument is the most obvious negotiating tactic in the world:  What’s good for the goose is good for the gander.  The services are essentially saying that if the rates should be frozen when the labels are paying the mechanical (which they are on physical and downloads), then the rates should be frozen when the services are paying the mechanical (which the services are on streaming).  And no inflation adjustment. Well, no kidding.

In one power move, the labels did something fair for songwriters and incidentally also helped publishers in spite of themselves by taking away a major argument from the digital retailers.  Rather than play a schoolyard game of high/low bargaining and stretching out the process for another couple years, the labels cut to the chase and closed. Hopefully the CRB will agree (again, don’t forget that the CRB still has to approve the proposed deal.)

Do we still have bones to pick with the labels?  Absolutely.  Could the rate have been even more fair?  Sure.  Might it have been if the publishers had actually done their job and negotiated in the first place?  Maybe.  Probably.  But they didn’t so we’ll never know.  However, credit where credit’s due, the labels pulled this one out and saved the publishers’ bacon in spite of themselves.

I do have to note in passing that when you read the press coverage on the filing of the settlement, there’s not one US group with a press release today that actually picked up a pen and filed a comment at the CRB when they were needed and duty called.  The awesome UK songwriter group Ivors Academy stepped up and bled with songwriters like Rosanne Cash, George Johnson, Helienne Lindvall, David Lowery and Blake Morgan and all the other commenters who took one for the team when it was unpopular to do so. And as that guy said, he who sheds his blood with me shall be my brother.

You’ll hear a lot of hoorah about how streaming is what’s important from people who are trying to CYA today.  Here’s a hot tip:  IT’S ALL IMPORTANT IF IT’S YOUR MONEY.  Why is that so hard to understand?

Which is why going forward all songwriters and all publishers need to be involved with the rate-setting proceedings at CRB including on streaming.  The CRB knows this and acknowledges.  I think the labels know this on their side.

The question is whether the publishers do.  The announcement of this settlement proposal is both inauspicious and true to form.  Remember—they had practically nothing to do with making the deal they celebrate today.  But don’t let that stop anyone.

We need fairness at the Copyright Royalty Board.  Notice I’m not using the word “transparency” which means whatever the speaker wants it to mean.  I’m very specifically talking about a seat at the table not just for songwriters, but for independent labels and publishers as well as the majors.  As Ann Richards used to say, if you’re not at the table you are on the menu, and this was a very, very close run thing in Phonorecords IV. 

If it weren’t for all the people who commented negatively and resisted the rates that had been bootstrapped in the past and would have been again, I don’t know where songwriters would be today. You gave the Judges the truth, straight from the heart and they responded. So thank you, all of you. And thank you to the readers of MTP and The Trichordist who raised hell right along side. It’s a good day for everyone.

Remember–keep coming back because it works if you work it.