The U.S. Department Of Justice [DOJ] delivered the above expected news yesterday [Thursday, August 4] to ASCAP and BMI. The DOJ decided not accept the proposed alterations to music licensing antitrust agreements there were set in place in 1941.
“The division’s investigation confirmed that the current system has well served music creators and music users for decades and should remain intact,” the DOJ stated.
In response to the announcement by the DOJ that it has completed its review of antitrust consent decrees regulating two of this country’s largest music PROs (Performing Rights Organizations), NAB President / CEO Gordon Smith stated, “Local radio and television broadcasters strongly support the DOJ’s decision not to modify the ASCAP and BMI consent decrees. We appreciate the hard work of the DOJ during its diligent, comprehensive review and believe that this decision will ensure that ASCAP and BMI continue to fairly and efficiently license musical works in a manner that is pro-competitive. Broadcasters look forward to continuing our close relationship with these performance rights organizations, which have worked to the mutual benefit of songwriters, music licensees, and listeners around the world for decades.”
Via comments submitted to the DOJ in July, the Television Music License Committee (TVMLC) and NAB voiced their support for the proposed conclusion that no changes were warranted to the consent decrees. Under the agreement, radio broadcasters pay $350 million and local television broadcasters some $150 million to songwriters and their music publishing houses annually.
BMI Will Challenge 100 Percent Licensing In Federal Court
ASCAP and BMI quickly responded, by joining forces to fight the DOJ’s ruling. BMI stated it is taking legal action and has initiated the process to challenge 100 percent licensing in Federal Court. ASCAP announced that it will take the lead for the two PROs in a legislative solution to ensure the continued availability of fractional licensing as well as other remedies to the outdated consent decree regulations that proves disadvantageous to songwriters and composers in the digital age. In its public statement, the DOJ called for legislative relief.
BMI President / CEO Mike O’Neill stated, “The DOJ’s interpretation of our consent decree serves no one, not the marketplace, the music publishers, the music users, and most importantly, not our songwriters and composers who now have the government weighing in on their creative and financial decisions. Unlike the DOJ, we believe that our consent decree permits fractional licensing, a practice that encourages competition in our industry and fosters creativity and collaboration among music creators, a factor the DOJ completely dismissed. As a result, we have no recourse other than to fight the DOJ’s interpretation in court. It won’t be easy, and we know it will take time, but we believe that it is the right thing to do and in the best interest of the industry at large.”
ASCAP CEO Elizabeth Matthews stated, “The DOJ decision puts the U.S. completely out of step with the entire global music marketplace, denies American music creators their rights, and potentially disrupts the flow of music without any benefit to the public. That is why ASCAP will work with our allies in Congress, BMI and leaders within the music industry to explore legislative solutions to challenge the DOJ’s 100 percent licensing decision and enact the modifications that will protect songwriters, composers and the music we all love.”
The full copy of BMI’s pre-motion letter can be found here.