Copyright Reform on the Table in Congress: Songwriter Equity Act of 2015 Introduced in the House of Representatives

0 Comments Written by on March 18, 2015 | Posted in Commercialization of Intellectual Property, Copyright Legislation

Copyright reform is on the table again in Congress.  A bill to amend the Copyright Act has just been introduced: the Songwriter Equity Act of 2015.  The text of the bill is available at the attached link

Surprisingly, the bill was introduced by Rep. Doug Collins from the 9th District of Georgia.  While the Atlanta area is the home to a number of rap musicians, as an attorney who once practiced in Georgia before relocating to the Silicon Valley, I can say with some authority that Georgia is generally not a state in which you would expect to see copyright-focused legislation to protect songwriters introduced.  However, what is perhaps far less surprising is that there is significant bipartisan support for the bill in the neighboring state of Tennessee, which of course is the home to the country music industry as well as a fairly significant part of the lesser known Christian music industry.  The Tennessean reports that  Senators Lamar Alexander and Bob Corker and Representatives Jim Cooper and Marsha Blackburn, both from the Nashville area but from opposite sides of the aisle, are all supporting the bill.  Additionally, according to The Tennessean, the bill has the support of music industry associations such as ASCAP, BMI, and the National Music Publishers Association.

So, if you are wondering what argument bill supporters are making for copyright reform in this case, the argument is that the compensation paid to songwriters and music publishers for digital royalty payments as set by the copyright royalty board is too low and that they should be paid fair market value for the music they write. The argument is that performance artists are getting paid significantly higher royalties, but that the copyright royalty board is not currently permitted to take into account privately negotiated royalty deals for performance of the music when it sets royalty rates for digital distribution of the music, so the law needs to be changed to enable the copyright royalty board to set royalty rates based on what the music is actually worth in the marketplace.

While the principles behind the bill seem reasonable enough, the argument against bill is that reforming copyright law to address this issue will drive up the costs of doing business for online radio companies.  The Tennessean addresses this issue in its recent article on the bill.  But in my opinion, this argument is weak: if copyright law as written is establishing an artificially low cap on royalty rates that is not in line with the market value of the music, then the artificially low cap should be removed to allow the market to determine the rates.  While Rep. Collins has argued in a recent interview with Billboard.com that this is a fairness issue, I would argue that it is really more of a free market issue, where one particular segment of our intellectual property system is not being permitted to commercialize its intellectual property rights to the same extent that other intellectual property holders are being able to do so.

Obviously, this issue is not getting much attention in the Silicon Valley, since our tech-focused community does not generally follow music industry issues, but with copyright reform on the table in the current Congress, perhaps Silicon Valley should be asking itself what other reforms should be introduced.  I can certainly identify a few areas where the copyright system in existence seems out of sync with the realities of the market.  What do you think?  Is a broader overhaul of the U.S. copyright system needed?

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