CPIP conference explores the impact of The MLC on US music rights ecosystem

The CPIP conference panel on the Music Modernisation Act (clockwork from top left): Spotify's Lisa Selden, moderator Mark Schultz, SONA's Adam Gorgoni, the Copyright Office's Regan Smith and the NMPA's Danielle Aguirre.

 
By Emmanuel Legrand 

A panel of stakeholders involved in the setting up of the Mechanical Licensing Collective, the new collective management organisation created in the US by the Music Modernisation Act of 2018 to license and administer mechanical rights, agreed that one of the biggest challenges faced by the new collective was getting all interested parties on board, in particular self-administered songwriters, to ensure that the database used by the MLC will be as thorough as possible. 

  "There are a lot of challenges in creating a completely new entity," said Danielle Aguirre, Executive Vice President and General Counsel at the National Music Publishers’ Association (NMPA) and Board Member of the Mechanical Licensing Collective. "We are fundamentally changing how mechanicals are working and it requires a lot of outreach and education to ensure that all publishers know how this will change how they receive about 29% of their US revenues." 

  Added Aguirre: "What we are asking [publishers] to do is to engage with a new entity, this collective but also interact with them. They have to be more engaged and get involved with the portal, clean their works, provide catalogue information."  

Getting data right

  Aguirre was talking at the session 'Implementing the Music Modernisation Act' during 'The Evolving Music Ecosystem' conference organised by the Arlington, Virginia-based Center for the Protection of Intellectual Property (CPIP). Aguirre and other speakers said outreach and collaboration between stakeholders would ensure that proper data is collected, resulting in better distribution of royalties from mechanicals. 

  "As an organisation, we basically have three areas we focus on: advocacy, education and community building," said US composer Adam Gorgoni, a Founding Member of Songwriters of North America (SONA). "As far as data goes, we'd rather have the responsibility for getting our data right than having it in the realm of digital services that do not have as much an interest as us to get it right." 

  He added: "We took on the task to educate our community on the most basic facts, so that we can participate in getting data correct and hopefully getting paid. Our chief goal in working on this is the education piece. Our community is not worried about publishers who have staff to do this all day long. Many songwriters don't know the first thing about their data. Most writers are mainly self-published writers who have no idea, so we push to educate songwriters. We have set up a 'Sexy metadata action group' (SNAG) to explain things in a way that our constituency will understand." 

DSPs get their voices heard

  Gorgoni took a positive look at the changes for songwriters brought by the MLC. "We do think that the blanket licensing regime [for mechanical rights] will be better for us if we do our part to get the data correct so that everyone will get paid what they are owed," he said. "We work with MLC to help with the portal so that it is constructed in a way that our constituency will understand it. We are having our members participate in the Data Quality Initiative." 

 For Lisa Selden, Global Head of Publisher Operations at Spotify, who also sits on the board of the Digital Licensee Coordinator (DLC), created by the MMA as the party representing digital services, DSPs are going to benefit from the MLC to manage mechanicals, as it streamlines a previously cumbersome process. DSPs also pay for the MLC's administrative costs. The DLC started with a nucleus of five members (Google, Amazon, Spotify, Apple and Pandora) and is now regrouping 10 DSPs with the addition of Medianet, Soundcloud, Qobuz, Tidal, and iHeartMedia. 

  "The role of the DLC is to get everyone aligned," said Selden. "We have been working with the MLC and the Copyright Office and there is still a lot of work to be done. Having DSPs in the mix and our voices heard is really an amazing opportunity for us because if we don't follow the rules perfectly, there will be extremely important consequences." 

Do right by the songwriters

  For Selden, sorting the metadata is paramount. "DSPs are very motivated to get it right," she said. "We do want to do right by the songwriters." 

  Selden alluded to the system pre-MMA, which did put the onus on the DSPs to identify rights holders for each song. A lot of platforms had outsourced that work to companies such as Music Reports or HFA, a function that will now be executed by the MLC. "Going from song by song to blanket is good for DSPs because we will have a much cleaner work-flow. We are happy with the whole way MLC is coming together from the DSPs perspective. It isn't perfect. We all had to come together as an industry to pass the MMA and all parties made some trade off, but it will be much better for everyone and easier for us to follow rules or regulations."