"Double Dipping" Royalties? Or This is Where it Gets Complicated...

The Mi2N - Music Industry News Network reports that The Digital Media Association (DiMA)

submitted a 'friend of the court' brief opposing a claim by the American Society of Composers, Authors and Publishers (ASCAP) that digital music downloads are 'public performances' and should, therefore, be subject to a public performance license and royalty.

This is a bit tricky and one that requires some explanation. ASCAP is what is known as a Performance Rights Organization and like all PROs collects fees for songs played in public venues, over the airwaves, etc. Radio stations, bars, cafes, etc. all pay licensing fees to PROs for the right of musicians and DJs to play any song in their catalogue. It makes sense that they want to get payed for digital radio, however here's the issue at hand, and it's tricky so let's follow this. DiMA claims that

DiMA members pay television, motion picture and sound recording producers hundreds of millions of dollars annually for the right to digitally distribute their copyrighted content, including the incorporated musical works. These synchronization, reproduction and distribution licenses, including "mechanical" licenses associated with sound recordings, are appropriately paid when musical works are used in audiovisual productions and sound recordings and are distributed to consumers - in physical or digital form. DiMA members also pay music publishers and songwriters (through ASCAP, BMI and SESAC) millions of additional dollars for the right to publicly perform musical compositions using streaming radio and video services.

Ok, that makes sense, right. You get paid when you reproduce a recording in mechanicals, you get paid when you synch a song to an image in a time-based manner, you get paid when you play it. However, for many digital blurs some of these lines, particularly between playback and recording. For example, if you offer a podcast of a radio show you are reproducing that song. In fact, this is also the case, to some extent, with some streaming that can be easily captured. Such is the blurriness that ASCAP and BMI want performance royalties even if you transmit a media file and it is never listened to. As DiMA notes

ASCAP and BMI claim that a download or even its “transmission” to a consumer – even if the media file is never opened and made audible or visually perceptible to the recipient – is a “public performance” that justifies an additional license and royalty. “This sophistry is based in fear – that ASCAP and BMI will have no service to offer publishers and songwriters if direct-to-consumer distribution substantially eliminates subscription or advertiser-based performance media,” stated Potter. “This fear seems unwarranted, but regardless, the law clearly states that a transmission justifies performance royalties only if the transmission is of a ‘performance.’”

Here's ASCAP's media release from March 1st

The American Society of Composers, Authors and Publishers (ASCAP) yesterday filed a cross-motion in the United States District Court for the Southern District of New York, asking the Court to confirm that all Internet transmissions of musical works to the public, including digital streams and downloads, are public performances - as the United States Copyright Law requires and Congress has stated.

Therefore, all digital streams and downloads should be subject to licensing by the creators and copyright owners of those works, through organizations like ASCAP which represent them.

"The emergence of the digital world is dramatically reshaping the way music is purchased and enjoyed," said John LoFrumento, Chief Executive Officer, ASCAP. "We strongly believe that our members are entitled to be compensated for all Internet transmissions of their music to the public - including the public performance that is an essential part of a music download."

Ok, so a download is a performance? Hmm, I think this is a willful confusion, at best. A download, as far as I am concerned, is the same as my purchase of a CD; streaming is the digital equivalent of broadcast transmission. I am brought back to a number of issues that used to exist when home taping was the fear-of-the-day. Back then we were running around with CRO2-90s, Cassette Decks and FM receivers. This combination, the music industry argued, would allow a rock radio station to play an entire album, we would tape them, and no one would get paid because of the excellent quality of such recordings.

Hahahahahahahaha. Oh, memories.

I can't say ASCAP and BMI will lose this battle, but I do think that the issue of determinable intent is key here and a download is not a performance. It just isn't. Or maybe it is. Make the case people. Make the case.

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