The Songwriter Equity Act of 2015 is a bill to amend Section 17 of the United States Code in order to “Ensure fairness in the establishment of certain rates and fees under sections 114 and 115 of such title, and for other purposes“.

In a nutshell, the Act aims to modernize outdated sections of Federal Copyright law that govern royalty payments in three ways: 1) by removing a provision in the current law that prohibits license fees, 2) by allowing copyright royalty judges to set royalty rates that reflect those in the modern marketplace, and 3) by loosening up the rules of evidence with regards to evidence that a copyright judge can take into account when setting rates.

If you are a songwriter earning royalties you should pay attention to this Act. If your sole source of income is royalties from songwriting, you should probably support this act and contact your Senator or Congressperson to solicit his/her support. If you are on Twitter you can use the hashtag #StandWithSongwriters. Of course, as a matter of principle I don’t like to tell people what to do or push political beliefs on anyone, so the purpose of this post is to give a brief overview of the proposed Act for educational/informative purposes. There’s a lot to the Act and the proposed changes so I’ll try to break it down, keep it straightforward, and include relevant links in case you are interested in researching further.

The official summary of the purpose of the Songwriter Equity Act is written by the Congressional Research Service, a nonpartisan division of the Library of Congress. It states that the proposed Songwriter Equity Act of 2015:

Amends federal copyright law regarding the exclusive rights of sound recording copyright owners to remove a provision that prohibits license fees payable for the public performance of sound recordings, by means of a digital audio transmission, from being taken into account in any administrative, judicial, or other governmental proceeding to set or adjust the royalties payable to copyright owners of musical works for the public performance of their works.

Requires Copyright Royalty Judges (CRJs), when setting royalty rates under the compulsory license available for the reproduction and distribution of musical works (commonly referred to as a “mechanical license”), to establish rates and terms that most clearly represent the rates and terms that would have been negotiated in the marketplace between a willing buyer and seller.

Requires CRJs, in establishing such rates and terms, to base their decision on marketplace, economic, and use information presented by the participants. Allows consideration of comparable uses and circumstances under voluntary license agreements.

You can find the official summary here. Additionally, you can read the current sections 114 and 115, along with the entire Copyright Act, here. Finally the new sections with the proposed changes can be found here.

Ideally, the purpose of the Act is to achieve better royalty rates for songwriters and to modernize the royalty process, specifically in the area of streaming music. For example, ASCAP has an excellent video in which a singer-songwriter notes anecdotally that royalty rates for streaming music on one particular streaming site is 9 cents per 1,000 streams. There was also this recent article by Ne-Yo and discussion of the article on the topic.

According to ASCAP, Sections 114 and 115 are “outdated” and “currently prevent songwriters and composers from receiving royalties that reflect the fair market value of their intellectual property.”

An excellent summation of the need for this legislation was summed up by Senator Patrick Leahy (D-Vt.) in his introductory statement to a March 10, 2015 Senate Judiciary Committee Hearing, where he stated in part that:

The emergence of a wide variety of legitimate digital music services has renewed questions about the proper compensation for songwriters and recording artists and the efficiency of a music licensing system that, in some respects, is almost a century old.

Senator Leahy’s full statement can be read here and a full video of the March 10, 2015 hearing can be found here.

If you are a musician living in 2015 and do not live under a rock then you most likely have your music posted on the internet. The internet pages where you post your music are most likely streaming this music to listeners all over the world. For many musicians streaming internet sites are the ONLY place where they have their music posted online. There is a debate amongst musicians about whether this is wise, which I will explore in future posts. For now, while the current compensation system stands, the general consensus is to post just a few tracks on streaming services in order to drive attention to your album sales. It’s basically the same concept as having a radio single to drive album sales. (You may disagree with my approach, of course. We’ll explore this in later posts.)

This is not the first time this issue has been raised in Congress. It was introduced last year by Senator Orrin Hatch (R-Utah) and Congressman Doug Collins (R-Ga.), and had to be reintroduced due to the end of the 113th Congressional term. The current bill has notable bipartisan support as well as the backing of numerous organizations including ASCAP, BMI, SESAC, National Music Publishers Association, and Nashville Songwriters Association International.

But do the proposed changes impact songwriters at the expense of others in the music industry? Not according to Daryl Friedman, the “Chief Advocacy & Industry Relations Officer” for The National Academy of Recording Arts & Sciences (NARAS) aka “The Recording Academy” (the people who award the Grammy’s). He states that the Act “address[es] the needs of songwriters, but “not…at the expense of other creators, such as the producers, engineers and performers”.

So is there a downside to the Act? Is anyone opposed to it? In a 2014 article opposing the act , the author’s argument is essentially that properly compensating songwriters will “raise the cost of doing business for online music stores and on-demand streaming services”. Herein lies the crux of the debate on this Act, and your views on this issue will likely indicate whether you support or oppose the Act. The opposition is essentially arguing that if 100 year old copyright royalty laws are updated in order to adequately compensate the copyright holder, then online streaming services (which will have to pay out more money to the artists) will either raise the cost of their product and/or go out of business.
The contrary argument, of course, is that many independent musicians are barely making any money, and it is a shame that artists with literally millions of streams are not making any money from their music. This raises two important issues which have been a source of constant debate in the music community and which I will address in future posts: 1) Should an artist allow his/her music to be streamed for free (or close to free) online and 2) what are we as consumers willing to pay to listen to music?

To recap, if you are a songwriter, producer, engineer, performer, or musical copyright holder, then you should be informed when it comes to this pending legislation. While I’m not going to dictate your opinion, I will give you mine. The Songwriter Equity Act is an excellent step forward in the long overdue and ongoing process of modernizing copyright laws to reflect changes in technology. While it certainly will not resolve every problem facing songwriters (one could always argue that it will create more) it is a step in the right direction towards ensuring fair and reasonable compensation for songwriters. All political humor and tavern grumbling aside, elected representatives are very busy individuals who have lots of responsibility and very little time. Between national security, the economy, and all of the important issues they decide every day it’s very easy for an issue such as modernizing the Copyright Code to slip through the cracks, which is exactly what happened in 2014. I have contacted my elected officials and if you are in support of this Act I recommend you do the same.

Songwriter Equity Act