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US: DOJ makes a dramatic change for Music Licensing Official

By  |  August 4, 2016

The Dept. of Justice’s antitrust office has issued a statement explaining the reasons it believes 100 percent licensing, or “full-works licensing,” is required under the consent decree. Songwriters and music publishers, as well as the US Copyright Office, have voiced vehement oppositionto the mandate since word of the DoJ’s rule change first came down in June of last year.

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    Previously, songwriters and the performance rights organizations (PROs) that represent them — primarily ASCAP, BMI and SESAC — were only allowed to license the portion of a song they controlled to users, like Spotify, of those works, in what’s called fractional licensing. Under the new rule, any co-author or PRO of a song can license that entire (“full”) work. Digital services have countered publishers’ and songwriters’ opposition to the change by saying it doesn’t change in any practical way how their businesses operate.

    “As our investigation proceeded,” the DoJ writes in a statement released this morning, “we discovered that there was significant disagreement in the industry about what rights must be conveyed by the blanket licenses (as well as other categories of licenses) that the consent decrees require ASCAP and BMI to offer,” the DoJ writes. “Some argued that, in order to effectuate the purpose of the consent decrees, the blanket license must grant licensees (also called ‘users’) the right to publicly perform all songs in the ASCAP and BMI repertories. Others believe that the blanket licenses offered by ASCAP and BMI instead confer only rights to the fractional interests in songs owned by ASCAP’s and BMI’s members and that music users must obtain separate licenses to the remaining fractional interests before playing the songs.”

    In the end, the DoJ concluded only full-work licenses could fulfill the meaning and purpose of the consent decrees. “We think the evidence favors the full-work side,” the DoJ said.

    Full Content: LA Times

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