Modernizing Music Licensing to Promote Innovative Business Models

In 1909 Congress required music publishers to license compositions to player piano roll manufacturers so long as manufacturers met certain requirements, including accounting for all copies produced and paying royalties.  As the music industry developed over the next several decades this law (17 U.S.C. 115) was fundamental to the sound recording industry, as it governed relationships between recording companies and music publishers through the development of vinyl albums, cassettes, 8-track tapes and compact discs.

In recent times, however, innovative online music services have been frustrated by the limitations of the Section 115 license, which was developed and worked perfectly for physical products that were distributed and sold in a traditional marketplace and which required only a handful of publishing licenses.  For many years DiMA has called on Congress to modernize this license so that it works for music subscription services and other innovative digital offerings.

DiMA Position

The Register of Copyrights, DiMA and all major music industry stakeholders – songwriters, music publishers and record companies – agreed in 2005 and 2006 that the Section 115 license should be modernized to aid the development of legal online music services.  This agreement was incorporated into legislation that ultimately was not enacted before Congress adjourned in 2006 (H.R. 5553), and was also referenced in Congressional testimony by the Register of Copyrights in 2007.

Legislation modernizing Section 115 was approved by the House of Representatives Subcommittee on Courts, the Internet and Intellectual Property in 2006, but was not approved by the full Judiciary Committee before Congress adjourned.

Status

No legislation is pending at this time.  DiMA and our members are monitoring the developing marketplace and determining whether a new legislative effort is appropriate.

Resources

17 U.S.C. 115 Copyright Law of the United States of America

Section 115 Reform Act of 2006 (H.R. 5553)

Hearing on “Reforming Section 115 of the Copyright Act for the Digital Age”
Thursday 03/22/2007