The Orrin G. Hatch-Bob Goodlatte Music Modernization Act (MMA) is a piece of legislation that was signed into law on October 11, 2018. The provisions that are contained within this bill aim to change and update old copyright laws and significantly improve the mechanics of the modern music industry.
How the Music Modernization Act Became Law
What are the components and purpose of the Music Modernization Act?
What are the expected outcomes of the Music Modernization Act?
There are three acts combined to form the Music Modernization Act:
The Music Modernization Act of 2018 has three main components. First, it will establish a non-profit governing agency to create and maintain a database of copyright owners relating to mechanical licenses. The database will be completed with assistance from major music publishers. The agency will then create a standard royalty rate that will allow streaming services to pay royalties to them as compulsory licenses, leaving royalty distribution up to the governing agency. This is intended to fix the ongoing problem streaming services face when trying to identify the correct parties to pay mechanical royalties on compositions.
The act improves the court process for royalty rate disputes by assigning a random judge in the U.S. District Court for the Southern District of New York to the cases, rather than giving them all to a singular judge in the Court.
The CLASSICS Act creates previously nonexistent federal copyright protection for sound recordings created prior to February 15, 1972. Under the new law, recordings created before 1923 will enter the public domain on January 1, 2022. The last of the pre-1972 recordings will go into the public domain on February 15, 2067, with older works entering earlier. Additionally, the CLASSICS Act allows the previously unprotected recordings to be tracked by SoundExchange and monetized from satellite radio. Until now, SoundExchange hasn’t had to pay for the streaming of the recordings.
The AMP Act designates SoundExchange as the responsible party for royalty payments to producers, mixers, and sound engineers that participate in the creative process. These individuals will receive a portion of the sound recording royalties earned from satellite and online radio services. Remember, SoundExchange only deals with non-interactive radio services.
Here are several points that indicate how the Music Modernization Act may affect the music business:
Notice: The information made available by DMAI does not provide legal or business advice and is intended to be used for general informational purposes only.
For additional reading, see the following links to various organization’s materials on the subject matter:
“How Does the Music Modernization Act Work?” was composed by Heidi Seo, Mamie Davis, Jacob Wunderlich, Luke Evans, Rene Merideth, Jeff Cvetkovski, & Aaron Davis