In the current state of the industry where we all should be supporting each other and fighting the same fight, ASCAP has chosen to retaliate against members who move to another PRO.
As the co-founder and president of SMACKSongs, I read with interest Ed Christman's recent article in Billboard, headlined Shane McAnally's Dispute With ASCAP Puts 'Premium Payments' in Spotlight. I was stunned at the outright half-truths and misrepresentations made by ASCAP in their response to Billboard's queries.
This entire process has been eye-opening as a music publisher -- not just on behalf of Shane McAnally, but on behalf of the dozen other current songwriters we publish at SMACKSongs. How can we encourage our writers to affiliate with a PRO that essentially holds a writer's songs hostage? How can we support an organization that so blatantly tries to retaliate against members if they happen to find a new champion at another PRO? In the current state of the industry where we all should be supporting each other and fighting the same fight, ASCAP has chosen to retaliate against members who move to another PRO. Funny enough, in response to a similar situation involving ASCAP members who had resigned from BMI in the mid-1980s, ASCAP's then-CEO Morton Gould stated: "BMI should treat all writers equally and should not adopt policies that trap writers economically and impede their mobility among organizations." It would be great if ASCAP's current management team held the same beliefs because its current philosophy is to trap writers and their works by making it economically impossible to exercise "mobility among organizations."
When ASCAP implemented the hit song premium in 1994, the purpose was and currently is to (1) reflect the importance to ASCAP's repertory and its licensees of works that achieve high level performances on radio and (2) to compensate members whose works "have a unique prestige value for which adequate compensation would not otherwise be received by such writer members." In Shane's case, ASCAP continued to license his works to radio through 2016. Shane had eight No. 1 records post-resignation that ASCAP licensed to radio -- yet, the co-writers of those same records received premiums from ASCAP while Shane did not. How can the same song have a "unique prestige value" to the radio licensee that benefits one writer but not for another writer on the same song? We believe firmly that the Consent Decree was put in place to prevent this very type of behavior.
In reading ASCAP's responses to the article, their position is that Shane should have asked them the question of whether or not he would lose his premiums after resignation. What they failed to admit is that we did ask questions -- and nobody at ASCAP had answers. It would have been impossible for Shane to find the "rule" or to even know to "ask the question" since (1) no such "rule" actually exists, (2) it is not part of any of ASCAP's governing documents, and (3) the alleged "rule" was not known by either their Nashville executive management team or their head of membership in New York, who maintained contact with me during this period.
We repeatedly asked why money was being withheld. ASCAP continually responded that it takes a long time to manually create statements. Nobody ever cited a "rule" as the basis of withholding payments or that they were phasing out the premiums. Paul Williams suggested that perhaps we had not read ASCAP's rules correctly. I listened to sworn testimony by Dr. Peter Boyle (ASCAP's chief economist) and Brian Roberts (ASCAP's COO) who both confirmed that the "rule" in dispute is not actually written anywhere. Boyle, the sole person at ASCAP who previously created the "manual resignation statements," also testified that he could not recall any instance in the past where a resigned member was subjected to the phasing out of radio premiums. It was only after Shane resigned this became a practice at ASCAP.
It is also disturbing to hear ASCAP Chairman and a fellow songwriter Paul Williams suggest that Shane was compensated fairly when ASCAP paid him less than half what it paid his co-writers. It's "fair" for ASCAP to license the same works to radio, but pay its writers differently?
At no time did anyone at ASCAP alert us that resigning and removing works would mean leaving millions of dollars at ASCAP, all while ASCAP continued licensing Shane's works to radio. Nothing was mentioned because nobody knew about the "rule" -- because it does not exist. In fact, we learned that ASCAP's Survey & Distribution Committee and ASCAP management spent much of 2015 shifting around sources of funding in a clear attempt to back-door a way of cheating Shane out of his hit songs premiums. ASCAP's response flies in the face of transparency.
I plan to ask the Department of Justice to thoroughly investigate this matter (and other anti-competitive practices of ASCAP's) before loosening any restrictions on ASCAP. ASCAP is the only PRO in the U.S. that treats its resigned members like this. Surely, if this were so competitively important the other PROs would institute similar practices or it would mean that ASCAP would stop losing hundreds of members a year to BMI, SESAC and GMR. ASCAP is the only PRO that requires all resigning members to leave works behind for "licenses in effect" and is also the only PRO that stops paying its resigned members a hit song premium after resignation.
Until real change is implemented, we will keep fighting the fight -- not just on Shane's behalf, but on behalf of each and every songwriter who deserves to receive their hard earned royalties from the exploitations of their works.
Michael Baum is the president of SMACKSongs, an independent music publisher based in Nashville.