A Sustainable Music Industry for the 21st Century

12 Pages Posted: 22 Jun 2015 Last revised: 31 Aug 2016

Aloe Blacc

University of Southern California

Irina D. Manta

Hofstra University - Maurice A. Deane School of Law

David S. Olson

Boston College Law School

Date Written: June 21, 2015

Abstract

This essay argues that the current system of music licensing must be completely overhauled. At this time, songwriters are paid a mere pittance when their work is played through Internet streaming services. The paper traces the evolution of compulsory licensing from the early 20th century, when Congress put this system in place due to concerns over the monopolization of the player piano industry, to today. This essay shows how the separation between copyrights for compositions as opposed to public performances contributed to blanket licensing through royalty-collecting organizations like ASCAP and BMI, which — together with government intervention into pricing based on antitrust concerns via consent decrees — has led to an inflexible and tightly controlled market in this context. Last, the essay demonstrates how the focus on classifying streaming services like Pandora based simply on whether they are "interactive" or not relies on a misunderstanding of the substitution effects and hence decline in music sales that Pandora creates. Eliminating compulsory licenses would allow individual songwriters to set their own prices and negotiate with streaming services, including in ways that would allow for price differentiation grounded in factors such as song popularity. Giving songwriters the same control that copyright owners outside the music context already possess will ensure songwriters' ability to continue providing the public with the works it loves.

Keywords: copyright, music licensing, compulsory license, streaming, ASCAP, BMI, consent decrees, pandora, internet radio

JEL Classification: K21, O34

Suggested Citation

Blacc, Aloe and Manta, Irina D. and Olson, David S., A Sustainable Music Industry for the 21st Century (June 21, 2015). 101 Cornell Law Review Online 39 (2016); Boston College Law School Legal Studies Research Paper No. 383; Hofstra Univ. Legal Studies Research Paper. Available at SSRN: https://ssrn.com/abstract=2621243

Aloe Blacc

University of Southern California ( email )

Los Angeles, CA 90089
United States

Irina D. Manta (Contact Author)

Hofstra University - Maurice A. Deane School of Law ( email )

121 Hofstra University
Hempstead, NY 11549
United States

David S. Olson

Boston College Law School ( email )

885 Centre Street
Newton, MA 02459-1163
United States
617-552-1378 (Phone)
617-552-4098 (Fax)

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