SOURCE: ASCAP

ASCAP

March 10, 2015 10:35 ET

ASCAP CEO Elizabeth Matthews Testifies for Senate Judiciary Subcommittee

Calls for Changes to Antiquated Music Licensing System to Better Reflect Free-Market Rates for Songwriters

WASHINGTON, DC--(Marketwired - Mar 10, 2015) -  Today, Elizabeth Matthews -- the CEO of the American Society of Composers, Authors and Publishers (ASCAP) -- testified before the U.S. Senate Committee on the Judiciary Subcommittee on Antitrust, Competition Policy and Consumer Rights. Representing ASCAP's 525,000 members, Matthews spoke of the need to reform the ASCAP consent decree that governs how songwriters are paid.

In her testimony, Mathews highlighted the critical role songwriters play in American music:

"Songwriters are the unsung heroes behind American music. Every song you hear comes from the heart and mind of a songwriter. Songwriters create the notes and lyrics on the page. This is the copyright in the musical composition that any artist can record. Unlike recording artists, however, most songwriters are not famous and they do not make money by touring and selling merchandise. Many songwriters do not have salaries, benefits and other reliable sources of income. They rely on public performance royalties to earn a living, feed their families and pay the rent." 

Matthews explained how streaming has dramatically affected the music industry, while the consent decree has failed to keep up:

"There have been seismic changes in the music landscape. People no longer buy the music they love, they stream it. Streaming services offer more choice and more consumer control. As a result, they require access to a massive variety of songs in order to provide users with an optimally tailored content experience. This means that the use of music has increased exponentially, but the payments have not followed. For a songwriter, this is a terrifying trend."

Written almost 75 years ago, the consent decree now threatens the very efficiencies of collective licensing it was intended to protect. Mathews testified on the many ways the world looks differently today -- including increased competition in the market -- while the consent decree has not been updated since before the iPod was introduced. 

Matthews emphasized the three major changes needed to streamline the music licensing system and make it more reflective of how people listen to music today:

  • Replace the rate court with a faster, less expensive resolution process
  • Allow ASCAP to accept a limited grant of rights from its members
  • Permit ASCAP to license all of the rights in a music composition a business needs to operate in one transaction
     

Due to the failure of the current system to generate free market rates for digital services, songwriters are unable to earn a fair living, and major publishers are considering withdrawing from ASCAP and other PROs. Williams stressed that all of this would lead to a more fragmented system, raising costs for everyone, including music fans:

"If the Consent Decrees are not changed and major publishers resign from ASCAP and BMI, then the system of collective licensing may collapse and everyone loses. Copyright owners, licensees, music fans everywhere and most importantly the songwriters who are the heart and soul of the entire music industry."

Matthews' testimony comes at a time with the U.S. Department of Justice is reviewing the ASCAP consent decree to determine whether and what reforms are needed. ASCAP is cooperating fully with the Department in that review.

Matthews also offered her support for the recent reintroduction of the Songwriter Equity Act (SEA) in Congress. The SEA is an important first step toward updating an antiquated music licensing system that treats songwriters differently than other copyright owners, preventing them from earning a fair market royalty rate when their music is streamed or downloaded.

Matthews' written remarks can be found here.

Matthews' oral testimony can be found here or in the full text version below.

About ASCAP

The American Society of Composers, Authors and Publishers (ASCAP) is a professional membership organization of songwriters, composers and music publishers of every kind of music. ASCAP's mission is to license and promote the music of its members and foreign affiliates, obtain fair compensation for the public performance of their works and to distribute the royalties that it collects based upon those performances. ASCAP members write the world's best-loved music and ASCAP has pioneered the efficient licensing of that music to hundreds of thousands of enterprises who use it to add value to their business -- from bars, restaurants and retail, to radio, TV and cable, to Internet, mobile services and more. The ASCAP license offers an efficient solution for businesses to legally perform ASCAP music while respecting the right of songwriters and composers to be paid fairly. With over 525,000 members representing more than 10 million copyrighted works, ASCAP is the worldwide leader in performance royalties, service and advocacy for songwriters and composers, and the only American performing rights organization (PRO) owned and governed by its writer and publisher members. www.ascap.com

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