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Federal rules give songwriters short end of the royalty stick

By   /   June 10, 2014  /   No Comments

By Chris Butler | Tennessee Watchdog

NASHVILLE, Tenn. — If only there was a songwriter clever enough to write a little ditty about the federal government screwing him over.

The federal government has determined what sorts of royalties songwriters may receive, since well before the time sound recordings were common.

Since 1909, in fact, the compensation rate per song has increased just seven cents.

Tennessee’s two Republican U.S. senators, Bob Corker and Lamar Alexander, are co-sponsoring legislation with fellow Republican U.S. Sen. Orrin Hatch of Utah to change that.

The Songwriter Equity Act, if passed, would change federal law and allow songwriters to receive fair market compensation for the value of their work through music downloads and CD sales.

FAIR MARKET: Bart Herbison promises legislation is on the way to take the feds out of the songwriting compensation process.

This, of course, begs the question: Why in the world is the federal government, and not the free market, determining royalty rates?

Well, that practice may change, too, said Bart Herbison, executive director of the Nashville Songwriters Association International.

“That’s our next step,” Herbison told Tennessee Watchdog.

“You’re going to be reading about legislation in a year or two that goes way beyond this act and lets the market do exactly that without judges involved.”

Herbison refers to three federal judges with the U.S. Copyright Office who form what is known as a Copyright Royalty Board. Those three judges, Herbison said, determine sales rate compensation once every five years.

“What we’re trying to change is the evidence and modernize the process so that these judges can take it into account when they set those rates,” Herbison said.

Currently, rules for songwriter royalties from CD’s or legal downloads are based on early 20th century laws, Herbison said.

“The way this law has changed the process is it would allow judges to determine the marketplace value of those songs,” Herbison said.

“Specifically the only place songwriters can currently negotiate is for their song in film and television. We get half and then the record label gets half. This bill is a lot more about record labels paying us more.”

Tennessee Watchdog’s attempts to contact the CRB on Monday were unsuccessful.

CHANGE OF PLANS: Tennessee’s two Republican U.S. senators, Bob Corker and Lamar Alexander, are co-sponsoring legislation with fellow Republican U.S. Sen. Orrin Hatch of Utah to change royalty rules.

Mike Reynard, spokesman for U.S. Rep. Marsha Blackburn, R- Brentwood, who is co-sponsoring companion legislation in the House, said it’s better for the free market to set the price for music.

“The rate court for songwriters is not market based and needs reform,” Reynard said in an email.

But Reynard also said collective negotiations and antitrust laws require the government, and not free market forces, to get involved in songwriter compensation.

According to a news release from the Nashville-based Broadcast Music Inc., the legislation would no longer forbid the federal government from considering other royalty rates as evidence when establishing digital performance rates.

Contact Christopher Butler at chris@tennesseewatchdog.org. or follow him and submit story ideas on his official Facebook page.

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Chris Butler is an investigative reporter for Watchdog.org based in Nashville. Contact him at chris@tennesseewatchdog.org and follow him on Facebook at "Chris-Butler-WriterJournalist" or on Twitter at cdbutler1204.

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