Pandora’s Testimony to Congress on Why Songwriter Royalties Shouldn’t Change…

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11 Responses

  1. Sarah

    So they welcome a competitive market, as long as it’s not actually competitive.

    The consent decrees are the result of “bad behavior” by the PROs – not individual songwriters. It’s somewhat silly: the PROs formed and succeeded because individual songwriters were basically powerless on their own to enforce licensing and royalty payments. Then the PROs misbehaved and the government stepped in to control that misbehavior. Now, decades later, the result is big, powerful PROs, extensive government regulations… and the songwriters themselves are basically powerless again.

    “But efficiency” isn’t a rebuttal to this anymore than it is to other market inefficiencies (which are endless, and you encounter everyday – “it’d be more efficient if every store charged exactly the same prices for everything so I don’t have to spend my Saturday shopping around”). Respecting individual property rights means putting up with some inefficiencies, and that’s an okay trade off. At the time the PROs formed, the one-stop licensing wasn’t a matter of mere inefficiency, it was closer to practical impossibility. That’s no longer the case, and the system should be adjusted to reflect that.

    Reply
    • Name2

      Respecting individual property rights means putting up with some inefficiencies, and that’s an okay trade off.

      For whom? And how? Another 1000 monetizing staffers at Pandora?

      Individual agents join societies and organizations to do this shit-work for them. Let them earn their cut.

      Reply
      • Sarah

        The reality is that if you got rid of compulsory licensing, you’d still have ASCAP/BMI. But because it is now possible for individual songwriters to manage licensing on their own (or hire someone to do it), it’d be a different ball game – a much more competitive one.

        And if Pandora can’t make it work in a free market, Pandora should go out of business. That’s just like if an artist makes music no one wants: by all means, continue making music but don’t expect to make money off it, get a day job. If businesses can’t compete and earn money without special government help, they shouldn’t be in business; it applies to artists and services alike.

        Reply
    • Musician Who Understands

      Sarah, the way you present this indicates that you really don’t have a balanced view, or a complete understanding of the issue.

      Sarah

      “So they welcome a competitive market, as long as it’s not actually competitive.

      The consent decrees are the result of “bad behavior” by the PROs – not individual songwriters.”

      And the Consent Decrees don’t apply to individual songwriters, either. The Consent Decrees only apply to ASCAP and BMI. So….. What was the point of that observation?

      Sarah

      “It’s somewhat silly: the PROs formed and succeeded because individual songwriters were basically powerless on their own to enforce licensing and royalty payments.”

      This is not true. Any songwriter can enforce their absolute, exclusive performance right whenever and wherever they want to. It just happens to be extremely inefficient for them to do so. You go on to talk about “efficiencies,” in other contexts, but here, you refer to what are clearly only “inefficiencies” regarding songwriters’ ability to enforce their rights as them being “powerless.” Clear bias.

      Songwriters are not powerless. They have an exclusive right. They just want efficiencies in administering those rights, in order to maximize them. Just like everybody else.

      Sarah

      “Then the PROs misbehaved and the government stepped in to control that misbehavior. Now, decades later, the result is big, powerful PROs, extensive government regulations… and the songwriters themselves are basically powerless again.”

      See above. We are not talking about absolute “powerlessness.” The discussion is about “efficiencies.” Using terms like “powerlessness” to describe one side of the issue, contrasted with mere “inefficiencies” to describe the other side, is not helpful. It distorts the issue being addressed.

      Sarah

      “But efficiency” isn’t a rebuttal to this anymore than it is to other market inefficiencies (which are endless, and you encounter everyday – “it’d be more efficient if every store charged exactly the same prices for everything so I don’t have to spend my Saturday shopping around”). Respecting individual property rights means putting up with some inefficiencies, and that’s an okay trade off. At the time the PROs formed, the one-stop licensing wasn’t a matter of mere inefficiency, it was closer to practical impossibility. That’s no longer the case, and the system should be adjusted to reflect that.”

      I don’t know why you say that one-stop licensing is no longer necessary.

      Even with the advent of the internet, individual songwriters still need and efficient way to license their works to all venues that perform them, and all those venues still need an efficient way to license the many songs they want to perform.

      What do yo think has changed about that or technology, that makes collectives like the PROs, which provide a centralized clearinghouse for those rights – for BOTH parties – obsolete?

      Sarah

      “The reality is that if you got rid of compulsory licensing, you’d still have ASCAP/BMI. But because it is now possible for individual songwriters to manage licensing on their own (or hire someone to do it), it’d be a different ball game – a much more competitive one.”

      1) ASCAP and BMI do not operate under a Compulsory license. Under the Consent Decrees, they provide what looks a lot like a compulsory license, in many respects. But the public performance right is not a Compulsory license, and that is an important distinction.

      2) Again, why do you think it is “now possible for individual songwriters to manage licensing on their own”? How does an individual songwriter mange the licenses for 100,000,000+ radio stations, digital radio streaming services, television stations, cable networks, bars, restaurants, stores, etc. in the United States (putting aside the rest of the world, for the moment)?

      Sarah

      “And if Pandora can’t make it work in a free market, Pandora should go out of business.”

      Actually, if you took away the collectives, Pandora would likely be one of the last to succumb to the pressures of a fully free market. Because of Pandora’s unique service, where they control what music get’s played, they have more of an ability to run with whatever licenses they could get, than most other services.

      First to go would be television stations. They have NO ability to control the content they are given to air. Without collective blanket licensing of the music portion of the programming they receive, television stations would have to shut down, immediately.

      Honestly, the way you talk about this indicates not only that you have a bias, but also that you really don’t understand how this all works.

      Reply
      • Sarah

        Musician Who Understands

        Using terms like “powerlessness” to describe one side of the issue, contrasted with mere “inefficiencies” to describe the other side, is not helpful. It distorts the issue being addressed.

        You’re right about that, thanks for calling me on it. I’m not interested in arguing but in discussing the issues, and that sort of evocative language isn’t conducive to a friendly, rational conversation.

        MWU

        I don’t know why you say that one-stop licensing is no longer necessary.

        It is no longer necessary. Many of your arguments are about efficiency, while mine are about necessity. One-stop licensing is absolutely more efficient; we agree. It isn’t necessary like it was decades ago. There was no other way to make licensing work in practice at the time, so it wasn’t just efficient it was in fact necessary. The fact that we’re now discussing degrees of efficiency instead of necessity suggests that it should be left to the market to experiment and determine the most efficient processes (which may include processes that aren’t currently available).

        MWU

        What do yo think has changed about that or technology, that makes collectives like the PROs, which provide a centralized clearinghouse for those rights – for BOTH parties – obsolete?

        I do not think the PROs are obsolete; I think that’s for the market to decide.

        MWU

        Without collective blanket licensing of the music portion of the programming they receive, television stations would have to shut down, immediately.

        Just like I shouldn’t have brought “emotional” terms into a discussion of efficiency, so too should we refrain from extreme, unrealistic assumptions like “you’ll instantly kill TV” to make a point. No one is arguing that collective blanket licensing should be stopped overnight, like it’s a switch you can flick off; that’s not even possible, there are unexpired licenses out there. I’m actually quite surprised to get this particular argument from you.

        MWU

        the way you talk about this indicates not only that you have a bias…

        Because you’re accusing me of having a bias, I assume you’re implying that my having a bias is a bad thing and inherently weakens my argument – and also suggesting that you don’t have one yourself. Well, you take a surprisingly hard-line position in a terribly complicated matter for someone who is completely unbiased.

        Reply
      • Musician Who Understands

        Dealing with your last points, first, just for a moment:

        Sarah

        “Because you’re accusing me of having a bias, I assume you’re implying that my having a bias is a bad thing and inherently weakens my argument

        Having a bias doesn’t necessarily weaken an argument, if that’s all you want to present. Evidencing a bias does, however, weaken an argument that is supposed to be based on objective facts. It clouds an honest discussion, as opposed to an “argument.”

        Certainly, argue only a particular side, if you want to (it’s all Paul does). If you do so without being objective, however, you should be prepared to have your bias revealed by others and your position discounted, accordingly (as Paul’s is).

        Sarah

        ” – and also suggesting that you don’t have one yourself. Well, you take a surprisingly hard-line position in a terribly complicated matter for someone who is completely unbiased.”

        I’m intrigued. What “hard line” am I taking? I’ve consistently made the case that collectives like the PRO’s provide efficiencies that benefit BOTH the songwriters and music publishers, on one side – AND the copyright users, on the other side, alike.

        So, which side am are you suggesting I biased in favor of?

        Much MORE more importantly however, you have repeatedly failed to support your multiple assertions that collectives aren’t necessary anymore, due to some undescribed technological capacity that we now have. I have asked you (several times, in this thread and others) to specifically explain what you think has changed that allows songwriters to efficiently license their public performance rights directly to services, and you seem unwilling to answer.

        So, again, I ask:

        What do yo think has changed about that or technology, that makes collectives like the PROs, which provide a centralized clearinghouse for those rights – for BOTH parties – somewhat obsolete?

        Why do you think it is, as you said: “now possible for individual songwriters to manage licensing on their own”?

        How – specifically – do you suggest an individual songwriter manage the licenses for 100,000,000+ radio stations, digital radio streaming services, television stations, cable networks, bars, restaurants, stores, etc. in the United States (putting aside the rest of the world, for the moment)?

        Reply
        • Sarah

          MWU

          What “hard line” am I taking? I’ve consistently made the case that collectives like the PRO’s provide efficiencies that benefit BOTH the songwriters and music publishers, on one side – AND the copyright users, on the other side, alike.

          The hard line isn’t between benefiting songwriters/publishers vs. copyright users. The hard line is the “this system that was formed in basically a different world is how it absolutely has to be done now” position. What’s the harm in exploring other possibilities?

          MWU

          How – specifically – do you suggest an individual songwriter manage the licenses for 100,000,000+ radio stations, digital radio streaming services, television stations, cable networks, bars, restaurants, stores, etc. in the United States (putting aside the rest of the world, for the moment)?

          Okay. You’ve put a lot into these ongoing discussions of ours, so even though I don’t want to get into specifics right now (because they’re just various possibilities that I think should be considered, not developed plans), I will. 🙂

          Central database.
          Songwriter/publisher adds song, and sets default price at which the song is available to would-be licensees.
          This can be across the board (default price for everyone is X), or across particular categories (X for all tv, Y for all digital streaming, Z for restaurants).
          The songwriter/publisher can also carve out areas (this default price isn’t available for nightclubs, submit a licensing request if you want it).
          Finally, the songwriter can choose to join collectives and agree to whatever terms (get creative – Music for Italian Fine Dining; 2014 EDM; Weightlifter’s Gym).

          Licensee goes into database and searches according to various criteria like genre (country), theme (suitable for fine dining), and price. He can make bulk purchases according to his criteria, or browse through the collectives and pick from them. If there’s something particular he wants (Taylor Swift’s Shake it Off), he can easily search and license it individually.

          The majority of licensing would be done through the standard “here’s my market rate” or the various collectives so there’s very little labor involved. The easier individual control of licensing and room for negotiating means that the market can reach a natural equilibrium – which may be very different from the one that results from the current licensing system.

          This is just an idea. The point is, there could be real ways of making individual management of licensing a realistic option, and they’re worth exploring . Maybe you’re right – the system is optimal as it currently is, and most people would want to stay with the collectives, but the reasonable option of individual management (as well as the ease with which new collectives could be formed) would mean that the collectives have to continually make sure they’re providing value to justify their costs – rather than taking it for granted that writers will always use them.

          I’m actually not claiming that a specific answer is right, but the fact that a not-insignificant percentage of the current market participants seem to think the results produced by the existing system are undesirable suggests it’s appropriate to look more closely into it.

          I have to bow out of this discussion for now (I’m sure we’ll pick it up later) as my attentions are elsewhere. I’ll check back at some point in case you respond, but I’d be delighted to continue talking directly, please feel free to contact me anytime at Sarah at repx – constructive disagreements can lead to great results.

          Reply
          • Anonymous

            The hard line isn’t between benefiting songwriters/publishers vs. copyright users. The hard line is the “this system that was formed in basically a different world is how it absolutely has to be done now” position. What’s the harm in exploring other possibilities?

            Its called those that push for advancement are the first to retract and hold back when advancement affects or puts pressure on their little patch of money and their little areas of profiteering…

            Of course when the translator or any of these other lower unimportant working class people got screwed no one seemed to give a crap, because advancement is the most important, so long as it isnt affecting the monwy power and control of certain peoples…

            Theyve killed people in the past for having resistance to their ideas and advancements but suddenly when the shoe flips to the other foot, its alright for them to hold back and restrict and cover up and suddenly anyone then applying resistance to their resistance to advancement, suddenly becomes like a bin laden to them… So its a damned if you do and damned if you dont…

            it is just ridiculous how history comes around and smacks people up…

            regardless, you just need patience, its only a matter of time, eventually it usually plays out accordingly, unfortunately for the little people, we have a very limited time with none to waste, so it gets a bit frustrating…

  2. Remi Swierczek

    I totally agree.
    Pandora should become simple, subscription free and advertising free music store.
    $10B+ globally legal, productive member of $100B music business.

    Mr. Grainge,
    Time to stop suicide mission! Apple/dead/Beats streaming will just extend agony of the industry.

    Reply
  3. Musician Who Understands

    Sarah

    “The hard line is the “this system that was formed in basically a different world is how it absolutely has to be done now” position. What’s the harm in exploring other possibilities?”

    Ha!!!! Oh geez…

    You have read far, FAR, FAAAR too much into what I have actually said.

    Can you show me anywhere where I’ve advocated keeping the present system, as is? Even come close to doing that?

    All I’ve done is note the benefits that come from collective licensing agencies and asked you what the alternative you are proposing is and how it would wok (more on that, below).

    I have absolutely no hard line agenda for the preservation of the collective licensing regime we have. Indeed, I’d be the FIRST to scrap it – especially if we had a reliable database through which licensing could be handled. But, that’s a long way off.

    Which brings us to:…

    Sarah

    “Central database.
    Songwriter/publisher adds song, and sets default price …across the board…or across particular categories

    Finally, the songwriter can choose to join collectives and agree to whatever terms (get creative – Music for Italian Fine Dining; 2014 EDM; Weightlifter’s Gym).

    This is just an idea.”

    But, you previously said:

    “it is now possible for individual songwriters to manage licensing on their own”
    and
    “[collective licensing] is no longer necessary.

    Those are definitive, temporal statements which clearly suggest that songwriters CAN license directly and manage that process – RIGHT NOW.

    Now, you’re saying it’s just an idea – and acknowledging that it is something that is, in fact, NOT possible, right now.

    I hope you see why I was confused about your previous, categorical statements that collectives “are no longer necessary.”

    FWIW, it is not a new idea. See the stalled SIRA legislation of 2007, the failed GRD, DDEX (and it’s precursors) and all the different, non-conforming standards, etc., etc., etc.

    I have long advocated that we should have such a database. Indeed, Chris Harrison of Pandora made it clear in his testimony that such a database is necessary and that Pandora would be willing to help fund it. But it’s not here. Sadly, we’re not even close, apparently.

    I’ll go further and say that this database should have ALWAYS existed, and is should probably be maintained inside the Copyright Office (the head of the Copyright Office is called the “Register of Copyrights,” after all…). But the Copyright Office long ago abrogated that responsibility and will most certainly never take it up, again, due to budgetary and liability concerns. Their recent “Report on Music Licensing” says, at once, that a) a musical works database is absolutely necessary… …and b) they will NOT be building it.

    Ironically, if such a database is constructed, it will most likely be developed by the dreaded “digital music services.” They have the most experience creating and maintaining databases like this efficiently – and, since several of them stand in the position of a “licensing hub” (having licensed mechanical reproductions, song performances and digital sound recording performances) – they have the largest set of otherwise-discrete data about songs, songwriters, music publishers and recordings.

    Not-so-far-fetched prediction: Watch Google put it together, all the major publishers and songwriters swear that they won’t use it/will never endorse it – and then, one-by-one, slowly cave and start endorsing and utilizing it, because, it just makes too much sense to ignore.

    Reply
    • Sarah

      Hmmm….. looks like we got our signals crossed, and it’s probably my fault for having multiple, similar ongoing conversations at once. But this is awesome, because it means we’re actually on the same page. 🙂

      Your not so far fetched prediction: based on Google’s track record – that’s probably not a great thing. I’d put money on your being right about Google’s building it, but I’d bet against it succeeding.

      I don’t want to say much more on this subject publicly right now, but I would like to talk with you about some of this privately sometime. You know how to get in touch if you’re ever up for that.

      Reply

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