Business Matters: SOPA Delayed, Not Dead, After House Judiciary Committee Session Ends
Business Matters: SOPA Delayed, Not Dead, After House Judiciary Committee Session Ends

While Congress gets ready to consider the Internet Radio Fairness Act of 2012 later this month, which some say is designed to lower pureplay webcasters royalty rates to record labels, the National Music Publishers' Assn. and other songwriter publishing organizations have sent a letter to Congress opposing the legislation -- adding that Pandora doesn't pay songwriters enough.

The letter - from Rep. Bob Goodlatte and Rep. Mel Watt (respectively the chairman and ranking member of the Subcommittee on Intellectual Property, Competition, and the Internet House Committee of the Judiciary), the NMPA, the Nashville Songwriters Assn. International and Church Music Publishers Association -- back the "willing buyer/willing seller" standard that allows record labels to negotiate rates with Pandora in an open market. Moreover, they say that publishers should also be able to negotiate under the willing buyer/willing seller standard.

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Currently, publishers songwriter rates for services like Pandora are set by the Copyright Royalty Board under 801(b) of the Copyright Act, which the letter says results in songwriters and publishers being "grossly" underpaid.

"For every dollar paid in music royalties by internet radio, only 8¢ of it is going to songwriters and publishers, while 92¢ is paid to record labels and artists through SoundExchange," the letter states. "This disparity is not defensible."

While the NMPA notes in the letter that it realizes the bill doesn't address publishers, it was sent to the committee to make them aware of the songwriter and publisher concerns surrounding the issue. "What is lost in the discussion … is the low level of royalties already paid to songwriters and publishers by internet radio providers like Pandora."

Also, the letter adds, "The bill also contains numerous troubling changes to the Copyright Royalty Board and its proceedings."

Finally, the letter closes with the notification that the NMPA and other interested parties are hoping to shape legislation that would reform Section 115, which provides for compulsory licensing. "The system is currently broken, and it is very difficult for new services to license quickly and effectively under Section 115." In the past, NMPA president/CEO David Israelite has expressed the desire to replace or curtail compulsory licensing with marketplace negotiated licensing.

But the letter adds that Section 115 reform shouldn't be a part of the current discussion around the bill. The letters' authors want "interested parties" to know about this separate legislative initiative, which they would like to introduce at the appropriate time.
The letter is signed by NMPA president and CEO David Israelite, executive director of the NSAI Barton Herbison; and CMPA president and CEO Elyen Raymer.

The letter is signed by Israelite, NSAI executive director Barton Herbison, and CMPA president and CEO Elyen Raymer.