U.S. Senate Judiciary Committee's 'How Much For a Song' Hearing: Here's How it Could Play Out

The U.S. Senate Judiciary Committee sub-committee on Antitrust, Competition Policy  and Consumer Rights is holding a hearing on the antitrust decrees that govern how ASCAP and BMI engage in music licensing Tuesday morning beginning at 10AM, with the proceedings expected to be streamed from the Judiciary Committee's website. For more information on streaming go to: http://www.judiciary.senate.gov/meetings. Among the witnesses expected to testify are:

Bonneville International VP of business affairs and general counsel Mike Dowdle. As a representative of the radio and TV broadcasting industry. Dowdle will likely be testifying that the consent decrees must be maintained. Bonneville owns a TV and radio station in Salt Lake City as well as radio stations in Los Angeles, Seattle, and Phoenix. Although Dowdle formerly served as president of Warner/Chappel Production Music Inc., don't be surprised if Dowdle offers up the settlements the Television Music Licensing Committee recently received from SESAC and the other pending antitrust litigation the RLMC has against SESAC. While SESAC doesn't operate under a consent decree, expect Dowdle to point out that even a smaller PRO can dominate licensing negotiations, which is why the consent decreed needs to stay in place for the larger PROs.

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Public Knowledge senior staff attorney Jodie Griffin. While providing testimony as the consumer's advocate at this hearing, Public Knowledge is viewed suspiciously by the music industry as a shill for the big internet players. Expect Griffin -- who is also a lecturer in law at the George Washington University Law School -- to hammer home why the consent decrees must be maintained at all costs.

Pandora Media VP of business affairs Chris Harrison. This guy is the front-man for Pandora's three-dimensional chess match against the music industry in the digital service's never-ending quest to get its royalty rates reduced. Pandora suffers from royalty rate envy. It views itself solely as a radio service and sees that one of its main competitors, Sirius, pays about 12% of its revenue to the music industry while terrestrial radio pays less than 3% of revenue for royalties, while it is paying about 54.5% of revenue for royalties. So far, Pandora has been giving the music industry conniptions in its fight to get its royalties reduced, trying one creative legal strategy after another, which is why his testimony could wind up as theater to watch.

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ASCAP CEO Beth Matthews. The newly appointed ASCAP CEO Elizabeth Matthews will undergo her baptism by fire during this panel with Pandora, Public Knowledge and the Bonneville International representatives probably arguing for the consent decree to be maintained. After her testimony, during the question and answer session, Matthews, previously ASCAP's executive VP and general counsel, will undoubtedly be grilled about the conclusions that Judge Denise Cote drew about possible coordination between ASCAP, Sony/ATV Music Publishing and Universal Music Publishing to achieve higher rates in the direct deals the latter two cut with Pandora.

BMI songwriter and Nashville Songwriters Assn. International president Lee Thomas Miller will likely embrace the ingredients of the Songwriters Equity Act, which potentially changes the way rate courts set songwriter royalties, in his testimony. Miller, who has written or-co-writtens songs like Brad Paisley's "The World," Tim McGraw's "Nothing To Die For," and Joe Nichols' "The Impossible," among other hits, will also probably embrace the PRO's desire for expanded responsibilities that include bundling mechanical and performance licenses together. But it will be interesting to see if he advocates for publishers' to have the ability to partially withdraw rights from the PROs blanket licensing. Some songwriters are distrustful that if publishers are paid performance revenue directly that those funds could be use as recoupment against advances. 

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SONGS Music Publishing founder and CEO Matt Pincus. As the lone music publisher on the panel, Matt Pincus will need to make a case for the publishers on why the consent decree should be modified. Its more likely that he will focus on issues like why willing buyer and willing seller and why sound recording rates should be used when rates are set. He will also probably ask for arbitration instead of costly rate courts; and for the consent decree to be modified to allow ASCAP and BMI to also handle mechanical licensing too. It will be really interesting to see if he asks for the decree to be amended to allow for partial withdrawal, especially since only the very largest of publishers can say with certainty that they will derive a benefit from withdrawal. More than likely, he will ask for partial withdrawals because if there isn't and the largest publishers withdraw completely from ASCAP and BMI, that will have a financial impact on those organizations, which in turn would likely have an effect on smaller publishers.