February 28, 2019
Dear BMI Member,
Today, I issued an open letter to the industry, along with ASCAP CEO Elizabeth Matthews, which addresses the pending issue of consent decree reform. With the U.S. Department of Justice (DOJ) evaluating the future of the BMI and ASCAP consent decrees, we could see change ahead.
The DOJ’s attention to this matter represents a clear opportunity to do what BMI has been trying to do for years on behalf of our creators – modernize music licensing to better reflect the transformative changes in our industry.
Throughout this process, it will be critical for the creative community to help educate the DOJ and lawmakers not only on why the PRO decrees are outdated, but also on the impact any change would have on you. We will be reaching out to you again soon to join us in this vital effort.
How we got here:
Nearly a year ago, Makan Delrahim, Assistant Attorney General for the DOJ Antitrust Division, called for a review of 1,300 legacy consent decrees that govern businesses across the country. Mr. Delrahim also raised the possibility of modifying or sunsetting (phasing out) the BMI and ASCAP decrees in the future. Not surprisingly, this has caused much discussion throughout the industry about the potential long-term effects on the entire music business. While the DOJ has yet to announce its next steps, we anticipate it will invite a public comment period about the BMI and ASCAP consent decrees in the coming months. It’s important to note that this currently remains in the discussion stage among many interested parties, and we expect this will be a lengthy process.
What BMI and ASCAP are recommending:
Since the consent decrees have been in place for nearly 80 years, suddenly getting rid of them would mean drastic changes to the industry and cause chaos in the marketplace. No one wants to see this happen.
In order to avoid that and provide an orderly transition, BMI and ASCAP are recommending the DOJ replace the current PRO consent decrees with newly formed decrees that would protect all parties. Like all modern consent decrees, they would also include a sunset provision. Those new decrees would contain four key provisions:
First, allow all music users to still gain automatic access to the BMI and ASCAP repertoires with the immediate right to public performance. However, this right should be contingent upon a fairer, more efficient, less costly and automatic mechanism for the payment of interim fees.
Second, retain the rate court process for resolution of rate disputes, as recently reformed by the Orrin G. Hatch-Bob Goodlatte Music Modernization Act (MMA).
Third, BMI and ASCAP will continue to receive non-exclusive U.S. rights from our writers and publishers, which allows licensees, songwriters, composers and publishers to still do direct deals if they so choose.
Fourth, preserve the current forms of licenses that the industry has grown accustomed to beyond the traditional blanket license, such as the adjustable fee blanket license and the per- program license.
What this means for you:
As we all know, there have been revolutionary changes to our industry, from new PROs, to music users consolidating, to dramatic shifts in the way music is created, distributed and enjoyed.
What hasn’t changed is that BMI is always guided by the best interests of our creators. We believe that our recommendations to the DOJ are the strongest path forward to creating a vibrant and competitive music marketplace. But rest assured, BMI will continue to maximize the value of your creative work whatever the outcome of the DOJ’s consent decree review.
Why we need your help:
Simply put, your voice matters. In 2016, we asked you to join us in voicing our concern against a 100% licensing model, and your efforts were essential to our victory.
As we’ve seen before, some organizations will try to use this moment and BMI’s and ASCAP’s consent decrees to serve their own interests at your expense. Old issues could come into play that could take us back, rather than forward. It could cause the government to insert itself into the process – something we all believe would be a worst-case scenario. Your voice will be critical in helping us ensure that doesn’t happen, so please be ready for us to call on you when the time is right.
Until then, know that BMI is, and always will be, dedicated to you, our songwriters, composers and publishers. And we will continue to fight for your right to fair and competitive compensation, as we lead the efforts to bring music licensing into the modern era.
President and CEO