Good morning, everybody.
I’m Paul Williams, and I create music.
Welcome to ASCAP's 2014 Annual Membership Meeting and the kick-off of the ninth ASCAP “I Create Music” EXPO.
This is a milestone year for ASCAP – our 100th birthday. And we commissioned that wonderful film you just saw as a way to shine a light on you - music creators - who are the heart and soul of ASCAP.
Way back in 1914, a small, visionary group of songwriters and composers had an idea. They believed that if they joined together to protect their copyrights and advance their profession, they would be far more effective than by any one of them going it alone.
And it worked. For 100 years, ASCAP has given songwriters and composers a collective voice.
The original founders of ASCAP were tough and smart and willing to risk a lot to get this new organization off the ground. They fought all the way to the Supreme Court. In a beautifully written landmark decision in 1917, famed Justice Oliver Wendell Holmes established the right of songwriters, composers and their publishers to be paid when their music was performed publicly.
That right has been challenged over and over again with every new invention – from radio to television to cable to satellite to the internet and wireless services. And over and over again, the brave women and men of ASCAP joined their voices together to ensure that songwriters and composers wouldn’t be left out in the cold every time a new business decided to build its profits by using our music.
The Board of Directors you elected continues that work with commitment, intelligence and passion. And today the stakes are higher than ever.
Technology is changing the world in wonderful ways. And it’s creating incredible opportunities for music to reach whole new audiences. But it’s also creating challenges when it comes to licensing our work. That’s because the rules and regulations that govern how we do business are outdated, and simply don’t work in today’s evolving music marketplace.
And that is what I want to focus on today. As music creators, the world we live in has changed. The way people listen to music has changed.
And yet, ASCAP and BMI are forced to operate within a regulatory structure governed by consent decrees created in 1941 and last updated in 2001, before the invention of the iPod. If ASCAP or BMI cannot agree with a licensee on the price of a license, then a Federal judge, or rate court, determines the amount we will be paid for our music from that licensee.
That, my friends, is unacceptable.
It’s unacceptable for the songwriter whose talent, hard work and sacrifice propels one of his songs to become an international smash, and after millions of streams on Pandora, receives a measly few hundred dollars for his achievement.
It is unacceptable that record labels and recording artists earn 12 to 14 times more than songwriters and publishers for the exact same stream of a song.
It’s unacceptable for the young songwriter, who is struggling to earn a living while pouring her life into her craft, knowing that outdated laws are allowing big music companies like Pandora to prosper, while many music creators struggle to pay the bills.
It’s not only unacceptable. It’s insulting.
It is no secret that the corporate internet giants who control all the pipelines of music delivery are lobbying aggressively in all arenas to protect their own economic profits, not yours. It is no secret that they want to find ways to avoid paying more for music. In fact, they’d like to pay less. That is why it is now absolutely critical for us to stand together as members of ASCAP and make our voices heard. We need to explain that we know we’ve chosen a profession that has no guarantees of success. We can live with that uncertainty. But when our music is successful, we shouldn’t have to accept the unfairness of a corporation making huge profits from music, while we get a pittance.
What are we going to do about it?
We need a long-term solution that works better for the music industry as a whole. The future of songwriting – and perhaps, the future of music – depends on us working together to fix these problems.
We know this. And we know that, right now, change is within our reach.
Of course, some people will tell you change is too hard. The system is what it is. Some of these people are already trying to capitalize on the weaknesses in the system as it exists today. And for an elite few, that could be a lucrative strategy. At least in the short-term.
But it won’t help the vast majority of songwriters, who are struggling today to make a living. It won’t help to ensure that songwriting remains a viable profession for future generations.
That’s why ASCAP is taking a different approach.
That is why ASCAP is leading the charge to update the laws that regulate how songwriters and composers license our works.
We are working on the front lines with policymakers and others in the music industry to build a consensus around how we can create a more efficient, effective and modern music licensing system – one that better serves you, but also better serves the needs of music licensees and music fans everywhere.
And today I want to share with you the five core principles we’ve outlined to guide our efforts. We call it our “Music Advocacy Project” or MAP, for short. ASCAP’s path toward a modernized system that works better for all – writers, publishers, licensees and music listeners.
1) SIMPLIFICATION: The music licensing process must be simplified, streamlined and reflective of how people listen to music today. Figuring out how to get paid from digital services is overly complex and time-consuming for music creators who’d prefer our time writing music, not chasing down pennies. Our members would like us to be able license all the rights that are implicated when a song is streamed digitally, not just the performance right, but we can’t because of outdated consent decree rules. Licensees want the same thing. It is easier, more efficient and reduces transaction costs. It also means more money in the pockets of songwriters and composers – and less money in the hands of middlemen who see dollar signs in an overly complex and confusing system.
2) MARKET RATES: The free market should determine the value of music copyrights, just as it does in other entertainment sectors. Songwriters, composers and publishers are forced to accept what amounts to government-imposed caps in two of the three main areas we earn revenues – performing rights and reproduction, or mechanical, rights. Rate court is expensive and can be used as a pressure tactic by companies who don’t want to pay a fair market rate for music. And oversight over mechanical rates by the government’s Copyright Royalty Board has led to a situation where mechanical rates have increased by only 7.1 cents over the past 100 years, which doesn’t even come close to matching the rate of inflation.
Forcing songwriters to sell our creative works to buyers at prices we deem unfair does not incentivize more creation. We need a better way.
Which leads me to our third principle…
3) CONSUMER CHOICE: Music listeners want access to a wide variety of music on any device they choose at reasonable prices. And creators want our work to be heard. The interests of creators and the public are fundamentally aligned here. If we are paid fairly by businesses that profit from our creative work, then we can continue to contribute diverse and high quality new music. This gives consumers the kind of variety of wonderful music they want and deserve.
That’s the way to sustain a healthy music market.
If ASCAP is unshackled by outdated regulations, then music lovers get more choice, more access, more music! That’s a good thing.
4) CREATOR CONTROL: In music, everything starts with the songwriter or composer. There would be no music business without the music creators. And therefore, music creators must be at the center of every effort to reform copyright. We have a vibrant creative class, but businesses that want to diminish copyright for their own economic benefit are working hard to change that. As a nation, do we really want to diminish one of the creative areas where we, as Americans, excel? And where music also helps spread our values of freedom and truth to the world? We should be able to sustain a viable living as professional songwriters and composers.
Let’s preserve a strong copyright law. It works to foster creativity for the public good.
5) ACCESS: A robust collective licensing system is proven to be the most effective way to ensure that creators are paid and that music lovers have more ways to listen to your music legally. ASCAP keeps the music playing, ensures our members are paid, and enables new businesses to launch legally at a reasonable cost.
If we are guided by these five core principles – simplification, market rates, consumer choice, creator control and access – I believe we can create a system that better serves creators, licensees and music lovers everywhere.
Let me report on some encouraging developments.
In February, Representative Doug Collins of Georgia introduced the Songwriter Equity Act. It already has strong bipartisan support. Early co-sponsors include Hakeem Jeffries of New York, Marsha Blackburn, Steve Cohen and Phil Roe of Tennessee, Judy Chu of California, Bob Brady and Jim Gerlach of Pennsylvania, Trent Franks of Arizona, Terri Sewell of Alabama, Howard Coble of North Carolina, Ted Deutch of Florida and Tim Griffin of Arkansas.
The bill would amend two outdated portions of the Copyright Act, Section 114(i) and Section 115, to remove the artificial barriers that keep songwriter and publisher compensation below fair market rates.
Specifically, the Songwriter Equity Act will allow the ASCAP and BMI “rate courts” to consider the rates being paid to record labels and recording artists as evidence when establishing digital performance rates for songwriters and composers. And it would adapt a fair rate standard for reproduction, or mechanical rates.
The Songwriter Equity Act is a small, but important first-step to wider reform. And we know reform won’t come easily or quickly. But there is a growing consensus that it needs to happen, starting with review of the consent decrees.
To that end, U.S. Register of Copyrights Maria A. Pallante recently announced a study to evaluate the effectiveness of the current music licensing system, noting specifically: “The time has come to re-examine whether the consent decrees governing ASCAP and BMI are serving their intended purpose and whether the consent decrees are facilitating or hindering a robust and competitive marketplace.”
This is huge development. And your fellow ASCAP members helped make it happen by joining us in Washington and making the case for reform to policymakers face-to-face.
Over the past year, we’ve had invaluable support from songwriters Josh Kear, Dan Wilson, Ne-Yo and others who have come with us to Washington to share their stories with policymakers.
And the chorus for consent decree reform is growing in other venues... The legendary Burt Bacharach recently placed an op-ed in the Wall Street Journal on this topic.
And it’s gotten so loud that the Chairman of the House Judiciary Committee in Congress, Rep. Bob Goodlatte, is now holding a series of hearings on music licensing, with a view toward understanding what is working and what needs a fresh look. I can assure you that ASCAP will continue to be on the frontlines in Washington fighting on your behalf.
I’d like to touch upon another matter that could have a major impact on music creators, and that is the Aereo case being heard before the Supreme Court. Aereo is a company that sells a device for capturing over-the-air broadcasts that then allows viewers to watch the programming on demand. Television broadcasters claim that this violates the public performance right in their copyrighted programming, and we agree. After all, your copyrighted music is contained in those programs. If Aereo wins in the Supreme Court, this could have a devastating impact in all creative sectors that invest and contribute to audio-visual programming for television. Of course, Silicon Valley is siding with Aereo. It’s not surprising that they are supporting a technology that flies fast and free with someone’s else’s intellectual property. ASCAP joined with BMI, SESAC, NMPA, RIAA, The Recording Academy, The Songwriters Guild, NSAI, and Sound Exchange in filing an amicus brief opposing Aereo. We are closely watching the outcome of the trial.
If you are staying for the ASCAP EXPO, I encourage you to attend the legislative panel tomorrow morning called “Congressional Review of the Copyright Act.” I’ll be joined by members of Congress Judy Chu and Tom Marino, and we’ll explore in greater depth the issues and challenges that are affecting our lives as music creators.
I also urge you to visit The ASCAP Music Advocacy Project booth in the exhibit area. From there you can write to your Congressman and ask for his or her support of the Songwriter Equity Act.
Add your voice. Get involved, even it is simply sharing our message on your social media channels. The more we can speak with one collective voice, the stronger our voice will be heard.
The future of the music industry depends on a system that better serves music lovers everywhere – and allows songwriters and composers to flourish, along with the businesses that use our music. It is our mission to ensure that all songwriters and composers get the full value of our work; that we’re paid in a fair, objective, transparent way; and that we retain control of our music.
Above all, we want to keep the music flowing.
The music you write – American music – is the most popular music in the world. I firmly believe that our ability to continue to create and export this music to millions of people who want it, who love it, who need it around the globe depends on all of us working together to build a more sustainable future for music – one in which you, and all of your fellow music creators, can thrive alongside the businesses that use it.
Thank you all for being with us today. Thank you for being part of this great organization. And, welcome to the next 100 years.
Now, please welcome our CEO, John LoFrumento.
Read ASCAP CEO John LoFrumento’s remarks here.