Music Modernization Act On the Brink of Becoming Law, Awaits Only President's Signature

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The US Capitol building.

The Music Modernization Act is not the law of the land yet, but it's pretty damn close, as the House of Representatives today (Sept. 25) unanimously approved passage of the U.S. Senate’s version of the bill, which had itself been approved by that chamber last week. Now, the MMA is off to the White House where it will await the signature of President Donald Trump before becoming the law of the land.

The legislation forged by compromises throughout the music industry creates a blanket mechanical license and a collective to administer it, while changing some of the considerations used in setting music publishing rates. It also compels digital and satellite radio to pay a royalty on pre-1972 master recordings to labels and artists and it codifies the procedure by which SoundExchange can pay producers and engineers royalties for the records it works on.

The RIAA, which along with the major labels made the last compromise needed to get SiriusXM on board and to get the legislation over the hump in the Senate, issued a statement praising the Congressmen who sponsored and worked on getting the legislation through the House, while throwing a nod in the direction of Flo & Eddie, who were the face of the class-action lawsuits that brought the pre-1972 issue to the mainstream.

“With this final House vote, another chapter in the journey of this critical legislation comes to a close,” RIAA president Mitch Glazier, one of the main movers behind the legislation, said in a statement. “As the Music Modernization Act goes to the President’s desk for signature, we have many Members to thank for their work to make this final House vote possible to improve the lives of countless artists, songwriters and producers. On behalf of a grateful music community, we extend our appreciation to Chairman Bob Goodlatte, Ranking Member Jerry Nadler and Representatives Doug Collins, Darrell Issa, Marsha Blackburn, Joe Crowley, Ted Deutch, Hakeem Jeffries and Tom Rooney for their leadership and commitment to getting this bill across the finish line. As the Turtles would say, we’re grateful Congress is ‘so happy together.’”

In between the compromises, however, there was also aggressive infighting between some industry players, which National Music Publishers’ Assn. president and CEO David Israelite, another key mover in shaping the legislation, acknowledged in a statement. “This was not an easy process, but it has galvanized the entire industry behind the songwriters, artists, producers and composers whose voices carried this bill across this threshold,” Israelite said. “Music is at the core of our country and it’s edifying to see Congress work together to ensure those who make it can make a living in the digital age.”

He added, “After many months moving through Congress, we are thrilled to see the Music Modernization Act officially passed. Now, only days stand between tonight’s House vote and this bill becoming law. We thank our champions, Congressmen Doug Collins, Hakeem Jeffries, Bob Goodlatte and all of the Members, who again voted unanimously to improve the lives of millions of music creators and fans."

The MMA updates the music licensing process with modern technology and greater transparency to speed royalty payments to music publishers and songwriters, and also provides digital streaming services with increased efficiency and greater certainty, according to a statement issued by the Digital Media Assn. (DiMA), an integral partner in shaping the legislation.

“Much has changed in the music industry in the digital age, with online streaming driving increased revenues for creators and copyright owners alike,” DiMA CEO Chris Harrison said in a statement. “A modern industry requires a modern solution. The MMA finally brings our music licensing laws into the 21st Century and ensures greater transparency and efficiency for the entire music ecosystem.

“This historic legislation has been a decade in the making. DiMA is proud of the role we played in spearheading this process from start to finish, working with our industry partners and lawmakers to create a system that works better for everyone -- publishers, songwriters, artists, record labels and digital services. This shows that we can put the old arguments of the past behind us and move forward together into a brighter, streaming future."

The Recording Academy, which championed the AMP portion of the act that benefits producers and engineers, also issued a statement on the act’s passage by both houses of Congress.

“The trajectory of the Music Modernization Act has shown the power of music creators to effect real change,” Recording Academy president/CEO Neil Portnow said in a statement. “From its unanimous approval in the House of Representatives in April, to its passage in the Senate last week, we have seen unprecedented advocacy from the music community. With today's final passage of the bill in the House, we are one step away from the most sweeping music copyright reform since the 8-track tape era, and we look forward to this being signed into law.”

Rep. Doug Collins (R-GA), a co-sponsor, issued a statement on the bill's passage. “Creators opened my eyes to the inequities in American copyright law during my first year in Washington,” Collins said. "Since then, I have been listening to and working with creators across the nation to make our laws work in the 21st Century for the entire music ecosystem. The Music Modernization Act began with a commitment to fairness and found champions in both houses and across the aisle, particularly Sens. [Orrin] Hatch and [Lamar] Alexander and my friend Rep. Hakeem Jeffries. It has been an honor to work alongside songwriters, publishers, digital streamers, broadcasters, artists and fellow lawmakers to make the music licensing landscape fairer and freer for everyone who’s ever loved a song.”

Moving over to the performance rights organizations, BMI’s president and CEO, Mike O’Neill, said in a statement, "Today, the U.S. House of Representatives passed the final version of the Music Modernization Act, now known as the Orrin G. Hatch-Bob Goodlatte Music Modernization Act. We are now one step away from enacting comprehensive copyright reform that will benefit American music creators for generations to come, while simplifying the licensing process for music streaming services. We would like to thank our music industry partners, the diverse businesses that utilize music, the bipartisan legislators, and the highly engaged, passionate community of songwriters and composers, all of whom together championed this bill to protect the future of music in our nation. We hope to be able to celebrate the final passage of this historic bill into law in the near future.”

While the initial version of the compromise legislation didn’t fairly take into account the impact that the blanket license and the collective created by the bill would have on the administrators like SESAC’s Harry Fox Agency used by digital services to make publishing payments, after further compromise SESAC became a supporter. With the bill’s passage, SESAC chairman and CEO John Josephson said in a statement, “Tonight’s unanimous passage of the Music Modernization Act by the House is a big win for content creators, and we remain hopeful the President will sign the bill in the coming days. Thanks to all for their support on this important legislation for our creative community.” 

The National Assn. of Broadcasters opened its statement by reminding the music industry of what it wanted out of the Music Modernization Act, noting it is particularly supportive of the provision in this legislation that ensures an enhanced congressional review of any Department of Justice changes to the ASCAP and BMI consent decrees.

“These decrees are essential to a functioning music marketplace, and any action to terminate them will now be preceded by appropriate Congressional oversight to protect the interests of songwriters, licensees, and consumers of music,” NAB president and CEO Gordon Smith said in a statement. “NAB is proud to stand with our friends from every corner of the music industry and applauds House passage of the Orrin G. Hatch-Bob Goodlatte Music Modernization Act. This critical legislation will benefit songwriters, legacy recording artists, producers, digital streaming services and music listeners. The MMA is the culmination of a years-long process to find consensus solutions to music licensing problems and oversight to protect the interests of songwriters, licensees and consumers of music."

The songwriter groups also weighed in. “With the swift and timely approval by the House of Representatives today of the Music Modernization Act, music creators in America are one step closer to living in a country whose laws are more in line with today’s music industry which lives largely in a digital world,” lawyer Dina LaPolt, who works with the Songwriters of North America (SONA), said in a statement. “Special thanks to our Congressional heroes Rep Doug Collins (R-GA) and Rep Hakeem Jeffries (D-NY) for all their support and hard work in getting us here!”

SONA often worked in conjunction with the Nashville Songwriters Assn. International (NSAI) in rallying songwriters to call out industry companies opposing the legislation. “Today Congress officially passed the Music Modernization Act, giving American songwriters real hope for fair royalty compensation in the future,” NSAI president and songwriter Steve Bogard said in a statement.

“It has been a long, long journey,” NSAI executive director Bart Herbison added in a statement. “But in many ways the journey has really just begun. After the President signs the legislation into law, songwriters and music publishers being a two-year process to create a new licensing agency that they will oversee. Controlling that process is very important and along with tools to achieve higher streaming royalty rates makes the MMA the most important bill for songwriters in history.”

In addition, one of the organizations that said it supported the legislation but was among those pushing for further changes, some of which occurred, to the legislation issued a statement. “The unanimous passage of the Orrin G. Hatch-Bob Goodlatte Music Modernization Act (MMA) in both the House and Senate is an important step in showing that consensus is achievable among music licensing stakeholders,” the MIC Coalition said in a statement. “We urge the President to quickly sign the MMA, which includes important provisions related to Congress’ concerns about the Department of Justice potentially terminating the ASCAP and BMI consent decrees, into law. The consensus that led to the MMA should serve as a model to address other longstanding music licensing issues, like pursuing transparency and simplicity in the multi-billion dollar performing rights licensing industry.”

And chairman Goodlatte and ranking House member Nadler issues statements as well. “Today’s House passage of the bipartisan Hatch-Goodlatte Music Modernization Act is a major victory for American music creators, music distributors and the music listening public," Goodlatte said. "This legislation, which modernizes our music copyright laws so music creators are fairly compensated for their works, finally brings our music laws into the digital age.

“I appreciate the hard work of the many House and Senate Judiciary Committee Members who came together on this legislative package. Music has such an immense impact on all of our daily lives and with this important legislation headed to the President’s desk, we will help ensure the sustainability of the evolving American music industry for decades to come.”

Added Nadler, “I am proud that the Music Modernization Act will now head to the President’s desk. This bill will update the law to better serve both creators and digital music providers. Virtually all of the major industry stakeholders came together to support this bill. I am particularly pleased that this bill includes several measures included in the Fair Play Fair Pay Act, which I introduced the last two Congresses. Under the leadership of Chairman Goodlatte, we have joined together on a bipartisan basis to modernize the music licensing system. We have seized this historic opportunity to resolve some longstanding inequities in the music marketplace by helping digital services more efficiently license and distribute musical works, while ensuring artists, songwriters and other music creators receive fair market value for their work.”

In a statement , the Copyright Alliance commended the House for passing the Hatch Goodlatte Music Modernization Act (H.R. 1551/H.R. 5449) and said it look forward to the President signing the law. “Today’s actions by the House continue to demonstrate the tremendous bipartisan, bicameral support for this bill following the Senate’s unanimous vote earlier this month,” the organization’s CEO Keith Kupferschmid added in a statement. “The bill continues to enjoy unprecedented support from the music and tech industries, as well as from hundreds of thousands of creators and countless friends of the creative community across the U.S., as it brings music copyright law into the digital age. The bill will result in the most significant improvement of music copyright law in more than a generation, making it easier for creators across the music industry to earn a fair living through their creativity.”

Finally, the Recording Academy said it will be hosting a coast-to-coast toast on Thursday, Sept. 27 at 5:30 p.m. PT/ 8:30 ET, uniting music creators across the country for a collective cheers to celebrate bringing music legislation into the 21st Century. Celebrations are scheduled in 16 cities -- from Seattle to Santa Monica, New York and Miami, and in between.