Thanks, Stevie Wonder: Radio Industry's Bill Velez Responds to Icon's Open Letter, Calls for 'Courage' in Licensing Reform

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Bill Velez is Executive Director of the Radio Music License Committee [RMLC], a non-profit that represents the U.S. commercial radio industry (some 10,000 stations) with regard to music licensing matters involving agencies such as ASCAP, BMI and SESAC.  Prior to joining the RMLC, Velez spent a combined 35 years as an employee of ASCAP, BMI and SESAC.

I recently read a Billboard editorial by Stevie Wonder and, lo and behold, his article made me recall that the two of us have something in common.  (Yes, I have a good singing voice, but that's not it.) I've always admired Stevie Wonder's artistic gifts and I actually worked for him during my tenure as an ASCAP executive. But, just like he diversified and added ownership of radio station KJLH to his music career profile, I traded years of championing songwriter causes as an executive of ASCAP, BMI and SESAC for the opportunity to move to the other side of the table, and join the Radio Music License Committee on the front line of negotiating music licenses with the performing right organizations (PROs) on behalf of the radio industry.

Perhaps not surprisingly, because it does get down to common sense at some level, I find myself in complete agreement with Wonder on the following points:

1.  The music licensing landscape related to the proliferation of PROs in the U.S. has indeed escalated to a level of whack-a-mole proportion that is out of control and which is rapidly threatening to upend a system that has served the interests of creators and music users alike for over a century now.

2.  It is unfair that we have two PROs in the U.S. whose rate-setting processes are subject to regulation via consent decrees with the U.S. Department of Justice [DOJ], Antitrust Division, and two PROs that are permitted to operate without an equivalent level of regulation.

Now, Wonder and I may disagree that the ultimate fix resides outside of a legal or legislative remedy. Regrettably, the facts do not lie. History has evidenced that, if you allow a PRO to aggregate important copyrights and to couple that with the legal "club" of copyright infringement (unless a music user submits to paying supra-competitive licensing fees), the PRO will inevitably engage in anti-competitive behavior that requires some form of antitrust remedy. I have great respect for my friends and former colleagues at the PROs, but I'm afraid that this axiom is as much a fact of life as death and taxes. Therefore, I don't think that you are going to be able to get all of the parties in a room and reach a Kumbaya moment without some form of leverage being exerted as a catalyst.

Whether the leverage takes the form of new Congressional legislation or the DOJ stepping up to ensure a level, regulated playing field between competing PROs, there is no easy way out of this quagmire. While I concur with Wonder's sentiment that it would be nice to avoid infinite legal entanglements that entail mightily-priced lawyers and economists, this may be difficult to avoid without a Herculean level of good will being exerted by both sides [and I suppose that this is exactly what Stevie Wonder is encouraging as a path to progress].

Here's food for thought. While I am not authorized to speak on behalf of the radio industry in this regard, I personally believe that there is an economic value that can be ascribed to a major league overhaul and simplification of the existing music licensing morass

Neither side will like what I have in mind.  

For music users, it may entail a tick up in license fee payments in exchange for the ability to achieve a single pay structure for issuing one check to one agency, and then leaving it to the various PROs to allocate that payment amongst them. Of course, this scenario would also force the PROs to cede some control of their existing licensing fiefdoms in order to reap the potential for a greater, aggregated single license fee payment.  Like the quote that Wonder cites: "Any negotiation where everyone is just a little bit unhappy means the outcome was fair."

Contrary to the character of Mordred in the Lerner & Lowe musical Camelot, who criticizes courage as a virtue that can get one killed, I would argue that it is one of the most admirable of human qualities. By virtue of his public stand on this issue, Stevie Wonder has opened himself up to some backlash from a music industry that seems to be intent upon wringing additional revenues from music users, even if it means driving them out of business. Wonder recognizes that this approach serves neither side's interests. His concern should spur a call to action to all of us that it's time to put hardened, unreasonable positions to the side and, instead, redouble our efforts aimed at developing music licensing fixes that create a "win-win."  

My gut tells me that, once we get past our hardened agendas, the solutions may actually turn out to be easier than we imagine. What do you say we round up some reasonable folks from both sides and lock them in a room until they reach some sensible solutions?


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