@RIAA Chief’s Proposal to Settle the Frozen Mechanicals Crisis by Expanding the Songwriters at the Table

The frozen mechanicals crisis points up one of the key problems in administering the statutory mechanical license in the US: Songwriters are a fragmented group. Merely chanting to courts that you represent all songwriters and publishers in the world when you know that is not reflective of reality is not a recipe for successful negotiations. It was only a matter of time until one of these deals imposed on the songwriter community turned sour. Frozen mechanicals turned out to be the black ice on the Nantucket sleigh ride.

Getting a result that is satisfactory to a broad group of songwriters and independent publishers is a challenge, no doubt. But the frozen mechanicals situation is actually not quite as bad as it could be.

First, we know what the dispute is about and the way the dispute could be solved. Those terms:

–Raise rates on the “Subpart B” configurations, meaning songs sold under the compulsory license in the permanent download, vinyl and compact disc configurations;

–Reach a private settlement and avoid the “battle of the experts” and further expensive litigation

–Include a broad group of activists from the US and other countries in the process.

–Create a settlement that is likely to pass review by the Copyright Royalty Judges (and ultimately Congress) and is at least less likely to get appealed by George Johnson and whoever else can manage to be granted standing.

–Unite the community against the streaming services.

The detailed and well-thought out sober comments by so many songwriters that seem to have been at least somewhat compelling and persuasive to the Judges tell the RIAA members who they must deal with and also give a good idea of what these group would find satisfactory. The RIAA members also have a unique opportunity to extract themselves from the “late fee waiver” deal that can be recast on more appropriate terms and include a much wider group with far fewer relations that give the appearance of conflicts.

Second, this is why it was encouraging to read this quote from Mitch Glazier, a long time community leader, deal maker, and head of the RIAA in an Ed Christman post from yesterday–a comment made outside the four corners of the RIAA’s controversial filing now characterized as “procedural”:

Glazier, however, says that he has no control who participates in the CRB proceedings — it has its own process that makes those decisions — he does have a say who participates in the negotiations for a new rate settlement and wants to include other independent songwriting groups, publishers and labels. He wants their point of view to inform negotiations, he says. But in order to have those discussion, it will take more time than the CRB currently would allow, thus the motion to delay responding to the judges on how adjudication should move forward.

I have to imagine that the major labels probably went into this Phonorecords IV proposed settlement first filed in early 2021 (so negotiated in late 2020, one would guess) feeling that surely their counterparties would have polled their membership and reached a bona fide consensus before making the deal. Particularly when the streaming companies were so obviously going to make the “good for the goose” argument in the streaming piece about frozen rates being applied equally to mechanicals regardless of who was paying.

This is particularly true when the services get to pay the old rates pending an appeal and are therefore incented to stretch out appeals as long as they can as a matter of drill if not sport. Another huge miss in the negotiation of Title I of the Music Modernization Act.

Songwriters know that if they are not at the table, they are on the menu as our dear late Governor Ann Richards used to say. It’s nice to see Mitch Glazier offering to include the wider group in settlement negotiations and we should all look forward to see how that goes. As Mr. Glazier said, his members are free to negotiate with anyone they want, and it’s obvious that the people who held themselves out has having all the experience and authority to speak for all songwriters in the world fell a bit short this time.

Let’s not make that mistake again. We are on the clock, and the golden hour for settlement is at hand.

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