On Wednesday, the Department of Justice opened a review of the nearly 80-year-old consent decrees governing how ASCAP and BMI license music. The decrees have been modified along the way, however they have been the solid framework that’s given radio stations at least some consistency in what they pay PROs for the right to air music from their repertoires.
The consent decrees governing the PROs were the byproduct or years of anti-competitive behavior by ASCAP and BMI. Addressing that anti-competitive behavior, the government took action, and the consent decrees were put in place allowing everyone fair access to the PROs’ music. Through blanket licenses, broadcasters have access to those libraries.
DOJ will decide whether to leave the consent decrees in place as is, modify them, or eliminate them.
The NAB’s Gordon Smith said broadcasters welcome the opportunity to participate in the review and appreciate the DOJ’s tone recognizing the ongoing importance of this antitrust framework. “For decades, these BMI and ASCAP antitrust consent decrees have ensured a fair and efficient licensing of musical works to local radio and TV stations. The decrees benefit songwriters, broadcasters, music licensees, and music listeners. Absent broader legislative reforms, their preservation is essential to a fully functional music marketplace.”
As you can imagine if ASCAP and BMI consent decree restrictions were removed, your music licensing costs would be completely unknown.
Back in February, BMI CEO Mike O’Neill and ASCAP CEO Elizabeth Matthews teamed up to write a letter about reforming the consent decrees. The two CEO’s recommended replacing the current BMI and ASCAP consent decrees with new decrees. Here’s what they proposed:
1) Allow all music users to still gain automatic access to the BMI and ASCAP repertoires with the immediate right to public performance. However, this right should be contingent upon a fairer, more efficient, less costly, and automatic mechanism for the payment of interim fees.
2) Retain the rate court process for resolution of rate disputes, as recently reformed by the Orrin G. Hatch-Bob Goodlatte Music Modernization Act.
3) BMI and ASCAP will continue to receive non-exclusive U.S. rights from our writers and publishers, which allows licensees, songwriters, composers, and publishers to still do direct deals if they so choose.
4) Preserve the current forms of licenses that the industry has grown accustomed to beyond the traditional blanket license, such as the adjustable fee blanket license and the per-program license.
Here’s what Assistant Attorney General for the Antitrust Division Makan Delrahim had to say about the review: “The ASCAP and BMI decrees have been in existence in some form for over seventy-five years and have effectively regulated how musicians are compensated for the public performance of their musical creations. There have been many changes in the music industry during this time, and the needs of music creators and music users have continued to evolve. It is important for the Division to reassess periodically whether these decrees continue to serve the American consumer and whether they should be changed to achieve greater efficiency and enhance competition in light of innovations in the industry.”
Comments about the DOJ’s review can be submitted HERE.
The public comment period ends July 10.
