In conference calls earlier this month, attorneys at the Department of Justice informed songwriters and composers that the DOJ intends to leave intact the consent decrees governing performance rights organizations ASCAP & BMI, and is reinterpreting these consent decrees to require ASCAP & BMI to offer 100% licensing.

Kevin Erickson, National Organizing Director for Future of Music Coalition made the following statement:

The DOJ’s strange decision to upend existing practices for music licensing will negatively impact both music creators and music licensees. Over the past year, Future of Music Coalition joined with many songwriter and composer groups in warning the DOJ that requiring 100% licensing would create an avalanche of new problems while accomplishing nothing. We’re dismayed that these warnings were not heeded.

The decision imperils songwriters’ ability to freely collaborate. And it creates new conflicts and challenges with international PROs, and potentially with international law and treaty obligations. It seems certain that more of the performance royalties generated by digital services will get tied up in new administrative costs. Furthermore, payments themselves may go down as a consequence of race-to-the-bottom “rate shopping” by licensees—an unwelcome outcome for songwriters already struggling with low royalty payouts from digital streaming services.

At the same time, we share the perspective of songwriter and composer groups, who agreed with the DOJ’s decision not to allow publishers to partially withdraw catalogs from ASCAP and BMI. Allowing major publishers to partially withdraw catalog in favor of direct deals with services (the terms of which might never be shared with creators themselves) would have meant losing very important protections and transparency provisions for songwriters and independent publishers.

As PROs and publishers weigh their options in the face of this ill-considered decision, any potential next steps must be centered around the needs of songwriters and composers themselves, without whom there would be no music to license. In particular, we urge solutions that will help achieve fair compensation and transparent accounting for the full range of songwriters and composers, regardless of their PRO affiliation or whether they have a relationship with a major publisher, an independent publisher, or are self-published.

In drafting a proposed legislative fix, the recommendations of the US Copyright Office in their recent music licensing study may be a good place to start; these recommendations include separating antitrust enforcement from the process of ratesetting, allowing the bundling of mechanical licensing with performance royalty licensing, and moving rate determinations from a clearly flawed rate court process to the Copyright Royalty Board, which is better equipped to evaluate the full range of relevant factors. These proposals appear to be one area where consensus between different music industry stakeholders could be found.