© 2018 by John Dick
An urgent request! Please read this entire article now and then contact your U.S. Senator as soon as possible, requesting that he/she votes against The Music Modernization Act.
“If good men do not speak out against bad things, who is to blame when bad men take over?”
My father shared these wise words with me in my high school years many years ago. It has since been my objective to be a rational independent thinker, even if it meant standing alone and being rejected by family and friends, or by fellow musicians and composers.
But no matter. Dad was right.
On April 25, 2018, U.S. House of Representatives Bill HR 5447, referred to as The Music Modernization Act (The MMA), passed unanimously with an astounding vote of 415-0. See who voted “yea” for HR 5447 here (227 Republicans, 188 Democrats). When I learned of this, I became very suspicious and concerned. Popular “bipartisan” legislation, in the context of today’s Congress, is always alarming to me.
HR 5447 (The MMA) was then sent to the U.S. Senate for their review and possible passing when they return from recess at the end of August 2018. From what I have read online, it is expected to pass the Senate, and then sent on the President Trump for signing. But it is reported that President Trump will veto the music bill if it ever reaches his desk (as it doesn’t really protect intellectual property, and it is a very bad deal for recording artists, composers, songwriters, and their publishers). However, if there is overwhelming support in Congress for it, they could simply override Trump’s veto, and make The MMA into law.
All positive reviews online hale The MMA as a great “bipartisan” achievement, with all politicians putting aside their “differences” and coming together “to do something right for a change.” I could only find a couple of news reports and opinion pieces against The MMA. Of what I could find out, it seems almost everyone in government, the media, the music biz (as it is), including big corporate biz like Amazon, BMI, ASCAP, is reporting how great this legislation is, and how it will finally “solve” problems of intellectual property, royalties, litigation, distribution, etc.
But for me, I smell a big rat. Who would think that 415 U.S. House Representatives, both Republican and Democrat, could ever come together and agree 100% on anything political. This tells me that everyone voting is getting something they want, and it is most likely not the freedom of the individual, not the sanctity of contracts, not the fair distribution of royalties, and not the protection of intellectual property (meaning property rights), as the supporters so unanimously want to believe. Especially in the context of the current political climate. And, just looking at the “official” supporters list (see Part 1 below) also tells me otherwise.
Legislation as bipartisan as The MMA is very worrisome. As one writer said about HR 5447, “The bill is a solution in search of a problem.” See that news article here, by Bryan Crabtree at Newsmax Finance. In my opinion, The MMA seems more like a solution in search of the control of earned monies (music royalties) and music distribution.
So, I decided to dive head first into the document to read HR 5447 and see what it would entail, all 150 pages of it. It is a massive volume of typical D.C. Speak, with the usual unending number of sections, clauses, sub-clauses, etc. Then I decided to write about it.
This is my interpretation and opinion, based on my personal philosophical and political orientation, as established here in my blog Capitalism vs. Statism. From my free-market perspective and interpretation, there are so many questionable and bad things about this music legislation. As there are so many parts to The MMA, and because I am also a music composer, I chose to focus on three separate areas – areas that I think will affect recording artists, composers, songwriters, and/or their publishers directly, and do the most harm to them.
- The MMA Supporters
- The Mechanical Licensing Collective: Control of music licensing, distribution, and royalties.
- The 2% of Royalties Cut
Part 1 – The MMA Supporters
One needs only to look at the group of supporters for HR 5447, musicians and other groups, as shown here and here, to get an idea of the basic focus of The MMA legislation. This list of supporters is an amazing bag of questionable mixed interests. The list includes “300 prominent U.S. recording artists,” as stated in the House of Representatives Judiciary Committee Report here. This 300 list reveals that most of the “prominent U.S. recording artists” are what are known as Legacy Music Artists: deceased artists and their Estates, older artists not recording anymore, etc. In other words, the old guard. Most Legacy Artists and their Estates will not be impacted or affected by much of The MMA. Good for them and their estates, but bad for the rest of us, especially up-and-coming new recording artists, composers, songwriters, and their publishers.
And, what about the “28,000 U.S. songwriters” on The MMA supporters list? I was not able to find this list of songwriters anywhere online. Who are they? I don’t know, but I suspect that they are all members from both BMI (Broadcast Music, Inc.) and ASCAP (The American Society of Composers, Authors, and Publishers). These two organizations are also on the supporters list. BMI and ASCAP have a huge stake in the consequences of The MMA, particularly their own survival if The MMA becomes law.
What I also found revealing is the other groups and organizations listed in The MMA supporters list, some of them seemingly of opposing positions. For example:
- Amazon and Digital Liberty
- Center for Individual Freedom and the AFL-CIO
- American Conservative Union (ACU) and the NAACP
As to why unions are so supportive of The MMA, it’s all about getting a bigger share of the money (royalties). Please see Part 3 below, The 2% of Royalties Cut.
Why are big corporate companies like Amazon, Apple, Spotify, Pandora, BMI, and ASCAP so supportive? It’s about acquiring “government enforced” monopoly control of the music distribution business through government “compulsory licensing.”
What I can’t understand is why organizations like FreedomWorks, etc., would even appear on the supporters list of such proposed legislation. But they are there nonetheless. In my opinion, The MMA has nothing to do with protecting or preserving the rights of recording artists, composers, songwriters, or publishers, including their intellectual property. It is all about controlling the distribution of music, and the confiscation of a greater portion of earned royalties from creative artists. It is all about legalized theft. And the majority of politicians and cronies know it. You would think groups like FreedomWorks would know better.
Part 2 – The Mechanical Licensing Collective:
Control of music licensing, distribution, and royalties.
Title I, Section 102, of The MMA, if made law, deals with what is called “Blanket Licensing,” and Compulsory Licenses, of which I have not yet had time to study closely. Read the text here. Section 102, Subsection (d)(3), also establishes a new government agency called the Mechanical Licensing Collective (the MLC, or “The Collective” as they are referred to). What I understand is that The Collective would become the “official” government agency that will be solely in charge of and in control of both “compulsory licenses” for digital content distribution and royalty distributions in the music industry.
My focus for this part is on music royalties. In reference to this, all royalties (that means “all” from “any” source) that are paid out will first go to The Collective and they will then distribute any royalties on a monthly basis, not quarterly as before, all according to the new statues under The MMA. The idea is to streamline the process, but through only one entity, namely the government in the form of this new agency, the Mechanical Licensing Collective.
However, there would be some new “compulsory” guidelines to follow, especially for recording artists, composers, songwriters, and/or their publishers.
A. All recording artists, composers, songwriters, and/or their publishers must register with the new governing agency, the Mechanical Licensing Collective, The Collective, within a certain time of copyright, recording, or production to receive any possible royalties from their work, or they would forfeit their royalties going forward. Not sure yet if there would be a registration fee with The Collective.
B. Because of this one possible statute, in my opinion, all composed music works (either in manuscript, audio, or digital form), therefore, will have to be registered with the U.S. Copyright Office in order to have “proof” that the recording artist, composer, songwriter, and/or their publisher can receive the royalties on their composed, produced, or recorded music. As you know, copyright registration for any music at the U.S. Copyright Office is expensive, especially for the struggling recording artist, composer, or songwriter. Believe me, I know. And, if The MMA becomes law, any artist that has any music already registered at the U.S. Copyright Office would also have to also register with The Collective if they hope to receive any part of their royalties.
Registration with the Copyright Office is still optional and voluntary at this time, as in individual freedom and the free-market it ought to be. But The MMA, if passed, could very well make that mandatory, or “encouraged” if you want to see any of your earned royalties.
Title I, Section 102 of The MMA also deals with Lobbying “restrictions” of The Collective. As stated directly from The MMA:
Sec. 102 – (d)(3)(c)(iv)
“(iv) RESTRICTION ON LOBBYING.—The mechanical licensing collective may not engage in government lobbying activities, but may engage in the activities described in sub-clauses (IX), (X), and (XI) of clause (i).” (which are described as following)
“(IX) Initiate and participate in proceedings before the Copyright Royalty Judges to establish the administrative assessment under this subsection.
“(X) Initiate and participate in proceedings before the Copyright Office with respect to activities under this subsection.
“(XI) Gather and provide documentation for use in proceedings before the Copyright Royalty Judges to set rates and terms under this section.
But even though The Collective would not be allowed to lobby, any and all supporters of The MMA (such as Amazon, Apple, Pandora, Spotify, NAACP, the AFL-CIO, ASCAP, BMI, Global Music Rights, Legacy Artists and their Estates, etc.) can engage in lobbying regarding their own special interests, favors, and licensing – and not necessarily in the interests of recording artists, composers, songwriters, and/or their publishers. Also, through “compulsory licensing,” these large selected corporate entities would then be able to hold on to their current large share of the private sector music business and distribution, existing as government enforced monopolies through the licensing, and not as competitive free-market agents. The MMA will create true massive monopolistic Cronies in the Music Industry in every since of the word. As only any true monopoly can ever exist: through government decree.
Also, consider these points: (1) litigation against these “licensed” corporate entities for not paying royalties will be eliminated on their behalf as the government would now be in control of payments out; (2) if there are any complaints against these “licensed” entities about missed royalties, recording artists, composers, songwriters, and/or their publishers would have to register their complaints with the new governing agency, the Mechanical Licensing Collective, or The Collective; and (3) because of the required compulsory licensing, these corporate entities will hold their monopolies and licenses, and not have to worry much about small start-up companies competing against them (as these start-ups would now need licensing as well).
In addition, as a composer, I would have to register with the “new” music governing “agency,” the Mechanical Licensing Collective (The MLC, The Collective), if I wanted to received any royalties from my work. And if I don’t register within a given time frame, I would forfeit my earned royalties to The Collective of any of my music that is distributed, aired, streamed online, etc. Also, I would be “encouraged” to register any and all of my music (no longer optional, as in freedom, but compulsory, as in force) with the U.S. Copyright Office (and pay the fees to do so) if I want to receive any royalties from my musical works, but only after everyone else has been “provided for.” Yes, the government will be in charge of distributing any and all royalties. This is basically forced membership into The Collective. In my view, this is also legalized theft of my musical works and earned royalties if I don’t register and join The Collective.
So, The MMA is going to help the recording artist, composer, songwriter, and publisher. Yeah, right.
As a side note, the term “collective” fits the narrative perfectly: it is a favorite term that has been used by all Marxists, Statists, Socialists, Communists, Progressives, and other Leftist groups for decades.
Part 3 – The 2% of Royalties Cut
Title III, Section 302, of The MMA, if made law, establishes that 2% of all earned royalties of any musical recording will also be paid out to each of any associated music producers, recording engineers, sound engineers, mixing engineers, or other associated qualified creative contributing personnel (my terms) related to or involved with any recorded music, such as studio musicians. Read the text here. In my opinion, it is not particularly clear in the text just who qualifies to received their 2% share of royalties.
As quoted in The MMA text: “…to distribute, to a producer, mixer, or sound engineer who was part of the creative process that created a sound recording, a portion of the payments to which the artist payee would otherwise be entitled from the licensing of transmissions of the sound recording. In this section, such instructions shall be referred to as a ‘letter of direction’.”
Let’s repeat: “…a portion of the payments to which the artist payee would otherwise be entitled from the licensing of transmissions of the sound recording.”
That “portion” is the 2% of all earned royalties earned by the recording artist, composer, songwriter, and/or the publisher of a particular musical recording, paid out to each specified personnel named in The MMA.
For example, a scenario list of who might be involved in a sound recording:
- Producer – 2% of related royalties to which the artist payee would otherwise be entitled.
- Recording engineer – 2% of related royalties to which the artist payee would otherwise be entitled.
- Sound engineer -2% of related royalties to which the artist payee would otherwise be entitled.
- Mixing engineer – 2% of related royalties to which the artist payee would otherwise be entitled.
- Hired studio musician 1 – 2% of related royalties to which the artist payee would otherwise be entitled.
- Hired studio musician 2 – 2% of related royalties to which the artist payee would otherwise be entitled.
- Hired studio musician 3 – 2% of related royalties to which the artist payee would otherwise be entitled.
- Hired studio musician 4 – 2% of related royalties to which the artist payee would otherwise be entitled.
- “Contractual person involved in the creation or lawful exploitation of the sound recording” – 2% of related royalties to which the artist payee would otherwise be entitled.
- Other associated “qualified creative contributing personnel” – 2% of related royalties to which the artist payee would otherwise be entitled.
So far: 20% of recording artist, composer, songwriter, and/or publisher earned royalties, those royalties to which the artist payee would otherwise be entitled, would go to 10 separate persons.
Keep adding other producers, engineers, etc. and you can see that the percentage of royalties paid out to them keeps going up, while the percent of royalties to the recording artist, composer, songwriter, and/or publisher keeps going down. Of course, hired studio musicians will still get their standard payments without reductions due to industry standards and/or Union requirements. And, The MMA will also encourage music producers and recording studios, including Unions such as the AFL-CIO, to keep adding qualified creative contributing personnel to the “creative process” (who will most likely also be union members) so as to collect even a larger percentage of earned royalties by artists, and so that the Unions can then collect even more money for themselves through membership dues.
That’s why Unions are so supportive of The MMA.
Questions: If these producers, engineers, studio musicians, etc. can get these royalties, why then can’t they help pay for recording time, production, etc. upfront? What about some “skin in the game?” What about free recording time for the recording artist, composer, songwriter, or publisher upfront? How about sharing the costs of hired studio musicians upfront? Or, how about hired studio musicians playing for free upfront? How about doing all that production and sound engineering and mixing on the studio’s, and their staff’s, own free time at no charge, upfront?
Otherwise, they get to collect all the production, recording, sound, mixing, performance, etc., costs and fees from the recording artist, composer, songwriter, or publisher upfront, and then sit back and collect a percentage of royalties on top of this, all because they were “part of the creative process,” and all because it is now decreed by coercive, mandatory law (legalized theft).
The bottom line: the recording artist, composer, songwriter, and/or music publisher, will still pay all upfront costs for U.S. copyright submittal and certification, The Collective membership fees if required, union membership fees if required, including all upfront costs for producing, studio musicians, recording, sound engineering, mixing, release, etc. to launch any of my music compositions and recordings. Including, when royalties start coming in, the 2% “creative” cut of these royalties. All this before any earned royalties start coming in to the artist and/or the music publisher.
And this is supposed to be “fair” to everyone?
This is usually called “double dipping.” I call The MMA legalized “open-ended dipping.”
In addition, if The MMA becomes law, as music producers and recording studios would share a percent of earned royalties, they would be motivated, even encouraged, to look for and/or cater only to those recording artists, composers, and songwriters who can, or at least have the greatest potential to, earn the most royalties, thus securing a higher percentage of earned royalties for producers, recording studios, union musicians, engineers, etc.
Also, because of this, producers and studios would orient their time and resources securing reliable royalty earners, and less willing to take a chance on an unknown recording artist, composer or songwriter, so as not to waste valuable time – even if the new artist is willing to pay for production and studio time.
Music producers and recording studios would be encouraged to do all this for their own interests and survival (and I wouldn’t blame them for doing so). It would also be even harder than before for a new-and-upcoming music artist to get started, even if they have the right connections. I dare say, the same survival orientation would also apply to music publishers.
And I also dare say the same survival orientation will also apply to the newly licensed “digital distributors” (government enforced and favored monopolies like Amazon, Apple, Pandora, Spotify, etc.). It will be in these Cronies’ interests to manipulate, maneuver, and play the new system to their advantage to gain an even higher percentage of any royalties earned and collected.
Regarding music distribution and royalties, The MMA is an amazing scam. The MMA would take away our right to negotiate freely with producers, recording studios, etc. In the past, any type of music recording arrangement and royalty distribution was negotiated between artist-publisher and music producers-studios-engineers, and dealt with through private contracts, and for the most part, not manipulated with government intervention, regulation, licensing, and control.
It was a free choice and action, a voluntary association and negotiation between free individuals and/or other parties and businesses – between artist, publisher, recording studios, record companies, distributors, etc. All working in their individual rational self-interests in freedom. All voluntary (as in freedom, capitalism, and a limited government), not compulsory (as in force, statism, and a despotic government). The government’s only role was that of the justice system and police forces, to resolve grievances between parties if needed, to uphold contractual agreements, or to police against and combat fraud and abuses of property rights (including misuses of copyright material and earned royalties, as from music creation). The MMA will change all this.
In the end, in my opinion, if The MMA becomes law, it will completely damage, even destroy, the music industry, much the same way that ObamaCare damaged the health insurance and medical industry.
Before all this, the government, more specifically the justice system, was our watchdog in matters of private contract adherence and the protection of copyrights. But if The MMA becomes law, then the government will not only be the watchdog, but it will also gain control of the distribution of music through compulsory licensing, as well as having control of the distribution of royalties and to whom, all at the same time maintaining relations with special interests groups and businesses (like the AFL-CIO, Amazon, Pandora, BMI, ASCAP, the NAACP, etc.). Who then will watch the watchdog?
The most annoying thing about all this is that I am spending precious, valuable time researching, explaining, writing about, and exposing this garbage, and not spending that time composing music. But, The MMA is very bad legislation, and it is an attack on the free-market music industry, on property rights, and the freedom to exercise them. I also care very deeply about music, especially my music. So, I must “speak out against this bad thing.”
I may stand alone in this sentiment, but I do not want to subsidize other musicians (any more than I am already forced to do through my taxes), and I will not be subsidized by other musicians or publishers. This is why I do not support NPR, PBS, or the National Endowment for the Arts. I will not be master nor slave to anyone. I do not live for the sake of another person, nor will I ask another to live for my sake. All I want is to live freely in a free-market system, to exercise my individual rights, including my property rights, in freedom with other free individuals, with anyone I choose, while not violating their freedoms and rights. I want to take my own chances freely in my own way, and hope that I may succeed, freely. If The MMA becomes law, it will greatly diminish this freedom.
Another concern I have is the impact The MMA would have on private contracts in their future development and negotiation. Also, this bill appears to only help and protect those who are already well established in the music industry (from composers, recording artists, studios, record companies, digital distributors, all the way to Amazon, Apple, Spotify, and Pandora, including all the Legacy Artists and their Estates), creating several monopolies along the way.
And, speaking of monopolies, what if the “compulsory licensed” digital distributors (Amazon, Apple, Pandora, etc.) decide only to air or distribute musical digital content that is produced only by unionized licensed recording studios and engineers, or that hire only union musicians? Or, what if they decide only to air or distribute musical content that is “politically correct,” or avoid airing or distributing “unfavorable” music?
Not going to happen? Consider the current political climate where Facebook and Twitter are banning “certain conservative content unfavorable to them.” It would only be worse if a government agency, like The Collective, were controlling licensing, distribution, and royalties – and special interests catered to them.
One can only imagine what similar types of legislation would do to other industries and businesses (where anyone can claim and take credit for “being a part of the creative process” and want their government-decreed percentage of royalties, that only a certain government agency will pay out), such as the book publishing business, or industries that deal with patents and inventions. One can bet the farm that Unions will also be there front and center all the way.
In the meantime, what can the new, unknown, or non-established recording artist, composer, or songwriter do now before The MMA has a chance to becomes law?
Share this article on your social media and blog, YouTube channel, etc. Write articles and op-ed pieces like this one and post to blogs, etc. Write to your U.S. Senators encouraging them not to pass this terrible legislation, and keep it from leaving Congress. Write to your U.S. Representatives and encourage them to change their previous support of The MMA. And, write to President Trump requesting that he not sign this ominous anti-freedom legislation. List the reasons mentioned herein, as well as for the protection of your property rights and earned royalties, for your freedom and rights to negotiate contracts freely and voluntarily, and to best serve your needs and values as a composer or songwriter. Also, new artists may wish to wait and see what happens in D.C. before they apply to register their music with the U.S. Copyright Office, and the established composer or songwriter may postpone copyrighting any further music to see what happens.
What if The MMA does become law? Well, if a composer or songwriter already has music copyrighted with the Copyright Office, they would have to register with the Mechanical Licensing Collective agency, The Collective, if they hope to see any part of their earned royalties paid to them by The Collective. Not clear yet if there would be any fees to register with The Collective. What if a composer or songwriter has never registered any of their music with the U.S. Copyright Office before? Well, they would certainly have to register, and pay the fees to do so, if they hope to collect any royalties in the future from their music, as well as register with The Collective, as mandated by law, to secure collection of any royalties.
Yes, I might be annoyed in spending time to write this. But think of how President Trump must of felt when he decided to run for U.S. President in 2016. Privately, he was probably very annoyed that America had gone so far astray from its original intent and individual freedoms, and that now he, as a true leader and not as some despotic politician, would have to set aside his life for 4-8 years to try to save America. Despite what all the anti-Trump politicians and citizens might think of President Trump, I think he truly loves America and wants to preserve any freedom left. President Trump may not be “perfect” and at times brash, but I think he is trying to save America, in the context of a terrible mixed-economy, and trying to beat back the bad men and women of the past 100 years who are trying to destroy America. I think this is why he says he will veto The MMA legislation if it reaches his desk.
The MMA is pure socialism, statism, and cronyism at their worst. It is a massive grab by a few selected “qualified” entities to control and distribute music, and related royalties (which can be enormous, into the hundreds of millions of dollars, even billions). Again, this is an attempt to redistribute any wealth created from music production to a broader, yet very carefully selected base. The bottom line is that it is all about the government, and their related cronies, controlling and grabbing more of the money earned and wealth made by creative recording artists, composers, and songwriters, under the guise of “protecting” the rights and intellectual properties of music artists: the creators.
I say this in the spirit of the Ayn Rand character, John Galt, of her novel Atlas Shrugged, when he says to his destroyers, “Get the hell out of my way,” I really hope to hell that President Trump, and a majority of legislators, can get The MMA legislation, and others like it, stopped and buried forever in the garbage heap of Statism, where it deserves to be trashed. Otherwise, such legislation will solidify our continual spiraling-down course into some Hell of Despotism, where corrupt politicians and their Cronies rule over every aspect of our lives, including the property and royalties of recording artists, composers, and songwriters.
Too serious? Too severe? Well, consider…
Most of our current politicians, their Cronies, and public supporters of despotism (leftism, socialism, statism, etc.) are very serious barbaric manipulative creatures who think they and society own your life, own your body, own your freedoms, own your ideas, your production, and your property. They think they have a claim to your life. No negotiation. They think it is their “right” to enslave each of us through compulsive licensing, legislation, and taxation, to be used as fodder in their crusade for the oppressive bondage of collectivism (statism).
The true fundamental question to all of this is: “Who really owns who and what?”
Your freedoms, individual rights, including your property rights, do not obligate you to any other person, government, country, social group, or society. No one but you owns your life, as an individual human being. Your rights and freedoms derive from your natural state as a human being, existing naturally only in the context of any social interactions with other human beings, and with nothing else, and require no permission from, or obligation to, another source. You, as a sovereign individual, own your life, your rights, your property. Therefore, if you compose music, that music is your property, and it is your right to freely do with it what you want. If you wish to make your music public, you are free to voluntarily negotiate private contracts with publishers, recording studios, and distributors in a way that freely, and fairly, benefits and protects all concerned, without any government intrusion or regulation.
The only true solution to any concern for the abuse against, and the protection of, individual rights, including property rights (i.e., music, royalties), is open, unregulated free-market competition between free-acting individuals, organizations, and businesses (Capitalism) – with all rights, and contractual agreements, protected by a nonintrusive, neutral, objective rule-of-law governmental justice system.
The despotic politicians, cronies, and other statists who support The MMA, and other legislation of this sort, only know government intrusion, regulation, force, and slavery to get what they want.
Well, I say “hell no!” And, I hope each and all of you say so as well. Please help stop The MMA.
For in the wise words of my father:
“If good men do not speak out against bad things, who is to blame when bad men take over?”
P.S. Just one day after I posted my article, mises.org posted a similar article regarding the video gaming industry. Statists will never stop with their obsession for power and control. That’s why we must have constant vigilance defending individual freedom.