Music Licensing and the DOJ’s Consent Decrees (CRS Report for Congress)
| Release Date |
Aug. 10, 2016 |
| Report Number |
IF10445 |
| Report Type |
In Focus |
| Authors |
Dana A. Scherer; Brian T. Yeh |
| Source Agency |
Congressional Research Service |
Summary:
On August 4, the Antitrust Division of the U.S. Department
of Justice (DOJ) announced an important interpretation of
two regulatory agreements that are critical to the structure
of the music industry. The agreements, called “consent
decrees,” govern the activities of two of the largest
organizations that license the right to “publicly perform”
copyrighted songs. These performing rights organizations
(PROs) represent songwriters, composers, and music
publishers, and also collect royalty fees associated with the
licenses on their members’ behalf.
Since the 1940s, the consent decrees have restrained the
two organizations, the American Society of Composers,
Authors, and Publishers (ASCAP) and Broadcast Music,
Inc. (BMI), from operating in ways the DOJ considered
anticompetitive. As music consumption has shifted from
ownership of compact discs and purchases of digital
downloads, to access via streaming services, the importance
of public performance rights has grown. In 2014, at the
request of ASCAP and BMI, the DOJ opened an inquiry
into the operation and effectiveness of the consent decrees.
On August 4, DOJ rejected the proposed revisions, and said
instead that from August 2017 it will interpret the decrees
in a manner that likely changes the way many songwriters
and composers are compensated for their music.
