Andrew Orlowski with Terry Fisher on Promises to Keep

Digital music: flat fee futures

When Steve Gorden, a flat fee proponent and former Sony attorney, made his case on NPR recently the RIAA stepped up to the plate, asking “Do you want Government to set the price for music – for Beethoven?” This absurd claim was left unchallenged by the producers, but it was typical of objections left during Fisher’s stint as a guest on Lawrence Lessig’s weblog. Not only did this bring out the usual array of bedroom hopefuls, touting their own software, but the objection to state involvement in the market for cultural goods. This gets short shrift from Fisher.

“These objections have a lot of rhetorical power, but they’re wrong headed. I point out in the book that the entire music industry is already shot through with government involvement: copyright confers power on producers insulating them from market forces, the entire intellectual property regime requires a major involvement of the government; and the past shows that the industry is full of devices such as compulsory licenses which required government involvement. The idea that an ACS for digital music represents a new involvement by government is entirely wrong”.

That said, Fisher notes, some objections seem quite legitimate and a successful ACS must address them.

Performance Rights in Digital Distribution

Old Songs Generate New Cash for Artists

SoundExchange, a nonprofit agency in Washington, is authorized by the United States Copyright Office to collect royalties from digital broadcasters and pay them directly to performing artists. Founded in 2000 and initially part of the Recording Industry Association of America, SoundExchange made its first payments in 2001 and, after a slow beginning, has begun to double its annual collections; in 2005 it expects to collect and allocate $35 million.

But the biggest obstacle the agency faces, it says, is getting the word out to artists and registering them for payment. These royalties for new and unfamiliar formats are a category of payment that performing artists in the United States have never had: a performance right.

“This is a brand-new right,” said John Simson, the executive director of SoundExchange. “A lot of artists are unaware of it, and we’re working against 80 years of a music industry without a performance right.” (In Europe and elsewhere around the world, performing artists are paid a royalty for radio play, but because the United States has not paid the fee in the past, it has generally not been reciprocated by other countries.)

[…] The artists who stand to gain the most from a performance right are performers of pop classics and oldies standards who never received radio royalties before but, since hits from decades past stay in rotation, could collect significant amounts of money.

Carl Gardner, one of the original singers in the Coasters, sang on “Yakety Yak,” “Charlie Brown,” “Searchin’,” “Poison Ivy” and other radio staples but did not write the songs, so he never collected a royalty when they were played on the radio. (Those songs were written by Jerry Leiber and Mike Stoller, who own their own publishing rights.)