Posted on January 26, 2018
Songwriters are the lifeblood of Music City. Thousands of them work as waiters, bus drivers or teachers as they build their songwriting career. Their paychecks ought to be based on the fair market value of their songs – so that when they write a hit heard around the world, they can see it in their billfolds.
The arrival of the internet has transformed the music industry, but it has also meant many songwriters aren’t paid royalties when their songs are played online. This is the first problem. The second problem is that when songwriters are paid, they aren’t paid a fair market value for their songs.
In 2016, for the first time in history, “streaming” music services generated more than half the music industry’s revenues, according to the Recording Industry Association of America. And while more listeners are streaming music online, traditional music sales are declining: the number of individual song downloads fell 24 percent between 2015 and 2016 and compact disc sales fell below 100 million units sold.
To give you an idea of what this really means for songwriters, a few years ago, I was outside of a pharmacy in Maryville and saw an old couple there and I said, "How are y’all doing?" And the lady said, "We're just falling apart together."
A few days later, I was with songwriters, Lee Brice, Billy Montana, and Jon Stone and told them the story. They said, "I think we could do something with that."
And they wrote a song called "Falling Apart Together,” and gave me one fourth of the song for suggesting the title because that's the way Nashville works.
Lee Brice put it on one of his albums, and I was paid one fourth of the royalties each time the song was played. Lee Brice is a pretty well-known singer so you might think that would add up to a lot of money, but in 2016 my royalties only added up to $101.75.
If you are a songwriter living in Nashville, you can’t make a living on that.
So for the last year, Senator – and songwriter – Orrin Hatch, R-Utah, and I have been working with Rep. Doug Collins, R-Ga., on a bipartisan solution to help songwriters get paid fair value for their songs.
Working with songwriters, music publishers, and digital music companies – we have reached a consensus on the most significant change to federal music licensing laws in decades.
Our legislation – The Music Modernization Act – first creates a new simplified licensing entity to make it easier for digital music companies to obtain a license to play songs and ensure songwriters are paid when their music is played. This new entity will collect royalties each time a song is played, look for the songwriter, and hold on to their royalties for three years until they can be found.
Second, the bill helps songwriters be paid a fair market value for their songs. Today the Copyright Royalty Board, a three-judge panel at the Library of Congress, sets royalty rates for songs that are downloaded or purchased on a CD. The current rate is 9.1 cents and is based on a below market standard.
Our consensus legislation adopts a new fair market value standard so a songwriter’s paycheck will be based on what a “willing buyer” would pay a “willing seller.”
Finally, the bill helps songwriters by allowing ASCAP and BMI to present new evidence about the fair market value of a songwriters work to a federal rate court judge when there is a dispute about royalty rates. The legislation also allows more federal district court judges to hear these types of cases.
The Music Modernization Act will help thousands of songwriters in Nashville and across Tennessee. Songwriters, music publishers, and digital music companies have reached a consensus, now it is up to Congress to provide a solution.
This is why I am working in a bipartisan way to pass the Music Modernization Act this year and help give Tennessee – and our nations – songwriters the fair pay they have earned.
Lamar Alexander, R-Maryville, represents Tennessee in the U.S. Senate.