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A Look At The Future Of Music Licensing

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A Look At The Future Of Music Licensing

Postby MrFredPFL » Tue Jul 23, 2019 6:13 pm

Story :

When you need to use a piece of music that you do not own the rights to, it usually means that you require a license from the copyright holder. This can take the form of a mechanical license, which covers the reproduction and distribution of a work, or a sync license, which is required when one utilizes another’s work in a visual piece such as a movie. Licenses exist in almost all areas of an artist’s life, and whether they are represented by a label, publisher, or even as an independent, it is crucial to be aware of how this part of the industry is changing.

Late last year, Nielsen Music conducted thorough research in multiple markets in North America and Europe and found that the industry is missing out on a staggering $2.65 billion from small businesses that use songs without the correct licenses in place. They found that eighty-three percent of these small businesses use personal streaming accounts, either free or subscription versions, for background music, instead of getting a blanket license which allows them to “publicly perform” the musical works of others. While eighty-six percent of those interviewed said that they would be happy to pay for the music they use, Nielsen found that the majority of es in all countries studied will incorrectly assume that paying for a personal account on these streaming services allows them to use it as background music in their respective institutions.

Although performing rights organizations such as ASCAP and BMI offer blanket licenses to companies, there is a general misunderstanding about how one is allowed to utilize music and who is meant to be compensated for it. Andreas Liffgarden, Chairman of Soundtrack Your Brand (the company that commissioned the former report) puts this down to a lack of innovation from streaming services driving small businesses towards easier solutions for their musical needs, and suggests that a “business-to-business (B2B)” streaming service targeted at these companies would mitigate the monetary woes of artists; however, there have been some efforts to combat this in the US. Earlier this year, for example, ASCAP filed thirteen copyright infringement actions against bars and restaurants across the nation in February for unauthorized public performances of musical works. Although this may be a deterrent to other companies, this method is extremely inefficient as a way to ensure that every single small business has the correct licenses in place for playing music in their store.

Taking out lawsuits against small restaurants, however, is pocket change when compared to licensing disputes between big industry players. Spotify, for instance, has been sued several times for not paying artists their dues as a result of poor licensing, and although the case is usually settled, plaintiffs can be seeking billions of dollars in damages. More recently, exercise equipment company Peloton had a lawsuit brought against them by music publishers seeking $150 million in damages for not acquiring sync licenses for over 1,000 songs that they paired with their workout videos . The publishers claim that it was a knowing and willing infringement because Peloton entered into some licensing agreements with copyright holders while neglecting to do so with others, which shows the resilience of publishers when it comes to representing their artists, but it begs the question: how do we improve the current ecosystem for distributing music? Willing or not, if the deterrent of lawsuits that size and the damages that it potentially has on the brand are not enough to stop companies infringing on copyright law, then it is perhaps better to ensure that the information and infrastructure for finding rights holders is set up to encourage this kind of economy.

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