The music license giants want to trample on free enterprise through government fiat.
The landslide presidential victory of Donald Trump has sent a shiver through the spine of crony capitalists of every stripe. What will a President Trump do? No one fully knows, but the residents of the swamp are nervous — very nervous.
The power players of the music industry were banking on a Hillary Clinton victory to solidify their stranglehold on controlling the copyrights of the music world. Hillary was their darling. The A-listers of the music industry came out to support her with concerts on the campaign trail.
Since the dust from the election has settled, little has changed. The music industry by and large is refusing to acknowledge President-elect Trump. In fact, according to most media reports, trying to find a musician willing to perform at the upcoming inauguration is like trying to find a needle in a haystack.
Despite its outright rejection of the incoming Trump administration, the music industry’s representatives in Washington have already come with hat in hand begging for favorable treatment.
Two major music collectives — the American Association of Composers, Authors and Publishers and Broadcast Music Inc. — are among these groups asking for special favors. ASCAP and BMI are government-recognized monopolies that together control the recording rights of 90 percent of all music compositions. They collect licensing fees on behalf of the composers, songwriters and music publishers.
These music collectives are ruled by consent decrees with the Department of Justice that allow ASCAP and BMI to maintain their monopolies in exchange for marketplace protections that safeguard consumers from monopoly pricing. These decrees force the two largest performing-rights organizations to provide licenses upon request and ensure that price-gouging does not occur.
This system has protected consumers for over half a decade, but it works out pretty well for ASCAP and BMI too. They both have hit record revenues in recent years, each topping more than $1 billion this year alone — but apparently this is not enough, and they want more. To raise revenue, they are not innovating or building a better product. Instead, they want to trample on free enterprise through government fiat.
ASCAP and BMI asked the Department of Justice to alter the consent decrees to allow a new scheme called “fractional licensing.” This new form of licensing would literally force any restaurant or local retail store wanting to play music to individually negotiate deals with every owner of millions of songs. It would be a logistical nightmare for American businesses. Fractional licensing would increase infringement liability for businesses of all stripes, and give rise to the same troll-like behavior that has plagued businesses across the country over patents.
The bottom-line goal of fractional licensing is to allow ASCAP and BMI and their largest music publishers to extort more money from businesses up and down Main Street.
It won’t help the customer. Music will become more expensive and less accessible.
Ironically, fractional licensing will harm the songwriter.
The only people it will benefit will be the trial lawyers and the music industry suits in their offices and smoky back rooms.
After a multiyear review, the current Department of Justice correctly rejected a move to fractional licensing. The music industry did not take kindly to this decision and to its most loyal allies on the Hill and in the courts. One judge in New York recently overruled the Department of Justice with a decision that ran against all legal reasoning and precedent — including a long-held decision by the Supreme Court. DoJ has since appealed the judge’s decision, and that case is moving forward.
As Trump makes his plans to drain the swamp, the music industry alligators are getting nervous. What will he do? Hopefully, we will see the new administration laying down the law against anything that is as anti-competitive and anti-American as what the music industry is pushing.
Steve Sherman is the senior editor at DailySurge.com, a radio commentator and a former Iowa House candidate. He is the author of five novels, including the recent political thriller Mercy Shot, and all of them can be found on Amazon or at SCSherman.com.
The views expressed in this opinion article are solely those of their author and are not necessarily either shared or endorsed by the owners of this website.
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