Music Modernization Act
Dec 19, 2019
What is the Music Modernization Act?
The Music Modernization Act, (MMA) or (H.R. 1551, Pub.L. 115–264) is United States legislation that was signed into law on October 11, 2018 and was aimed at modernizing Section 115 of the U.S. Copyright Act to bring it up to speed for music as a result of new technologies for the streaming era.
This is the first copyright legislation to pass in decades and has made changes to three different areas of music law (the MMA, the CLASSICS Act, and the AMP Act). This legislation accomplishs 3 things:
- The Music Modernization Act, streamlines the music-licensing process to make it easier for rights holders to get paid when their music is streamed online
- The Compensating Legacy Artists for their Songs, Service, & Important Contributions to Society (CLASSICS) Act for pre-1972 recordings
- The Allocation for Music Producers (AMP) Act, which improves royalty payouts for producers and engineers from SoundExchange when their recordings are used on satellite and online radio. VIP this is the first time that producers have been mentioned in copyright law.
What happens next?
Now that the MMA has been signed into law, the next step is the creation and management of the database for the mechanical licensing collective (MLC). The MLC database will maintain all works available for compulsory licensing. The MLC is tasked with identifying works and copyright holders, and distributing royalties. It also creates a process for the use of orphan works, which are works whose copyright owners cannot be identified or located. Finally, the MMA moves the rate-setting standard used by Copyright Royalty Judges from a policy-oriented rate setting standard to an open-market standard.
The MLC will be run by a board which will be comprised of 17 members: ten voting representatives from music publishers; four voting representatives who are songwriters with rights to their own publishing; and, three non-voting members representing, respectively, a nonprofit trade association of music publishers, a digital licensee coordinator, and a nonprofit advocating for songwriters.
What does it change?
First change: The use of music by streaming services will now be paid for in a regularized royalty arrangement:
The most significant piece of law for artists, is the MMA changes the process for obtaining a compulsory license for digital performance of music as downloads or streaming. The services will now need a blanket license “covering all musical works available for digital licensing" instead of a song-by-song basis.
Second change: Digital services will have to pay for their use of songs recorded and released before 1972 (these recordings were not previously protected by copyright law).
The CLASSICS Act extends federal copyright protections to pre-February 15,1972 sound recordings based on a predetermined schedule:
- Recordings first published before 1923 are now protected up to December 31, 2021;
- Recordings created between 1923-1946 are now protected an additional 5 years after their general 95-year copyright term;
- Recordings created between 1947-1956 are now protected an additional 15 years after their general 95-year copyright term; and
- Recordings created between 1957-February 15, 1972 are now protected an until February 15, 2067.
Rights holders might be able to obtain retroactive relief from the past three (3) years of transmissions, but transmitters have 270 days (until July 7, 2019) to register the last three (3) years of transmissions and pay the mandated royalties before that is available.
Third change: Audio producers and engineers who participated in musical recordings will start to be paid when their recordings are played on online and satellite radio services.
The Result
The end result should be the potential of the MMA to establish a system that works better for songwriters and allows streaming services to better serve the fans and creators.