Playing Music On the Net
By Marie D’Amico
The Internet is the hottest new arena for emerging and established recording artists to deliver their product to the public. Bands, major music publishers, and a slew of startups have set up shop on the Internet to ply their wares. The Digital Performance Right in Sound Recordings Act of 1995 , which became effective February 1, 1996, changes the U.S. Copyright Statute , 17 U.S.C. ß 101 et seq., and the legal landscape for all of these companies. The html version of the Copyright Statute is divided into chapters; each chapter contains sections beginning with that number. For example, 17 U.S.C. ß 101 is in Chapter 1, 17 U.S.C. ß 405 is in Chapter 4.
1. Publicly Performing Music: To publicly perform music, you need a public performance license. The U.S. Copyright Statute , 17 U.S.C. ßß 106(4), 101, grants to the owners of musical works the exclusive right to perform publicly their copyrighted works. To perform publicly means "to transmit or otherwise communicate a performance . . . of the work to . . . the public, by means of any device or process, whether the members of the public capable of receiving the performance receive it at the same place or in separate places and at the same time or at different times." 17 U.S.C. ß 101. In 1976, Congress adopted a compulsory licensing scheme for public performances of music. Therefore, to publicly perform music on the Internet, you must obtain a license from ASCAP , BMI , and/or SESAC , the music performing societies who control the administration of public performance licenses. While you must pay for such a license, the benefit of a compulsory license is the owner of the musical work cannot say "no." Generally, ASCAP , BMI , and SESAC issue blanket licenses which permit licensees to play any composition from the hundreds of thousands of songs in the societies’ respective catalogs, in exchange for a fee, normally based upon your gross revenue. ASCAP and BMI both have experimental blanket licenses to cover public performances of music on the Internet. While they are ambiguous agreements which contain ill-defined terms, you must sign them because they’re the only game in town. SESAC doesn’t yet have an agreement for public performance of music on the Internet, but SESAC they are currently revising a draft.
2. Musical Works v. Sound Recordings: Any song is composed of two separately copyrightable parts, the musical work and the sound recording. Whitney Houston ’s cover of the Dolly Parton -penned hit, "I Will Always Love You," from the hit movie, The Bodyguard , is separately copyrighted by Dolly Parton (the underlying song) and Whitney Houston (the record). The Copyright Statute only provides to the owner of the musical work (Parton) the exclusive right to publicly perform it. 17 U.S.C. ß 114 ("The exclusive rights of the owner of copyright in a sound recording . . . do not include any right of performance under Section 106(4).") When you hear Whitney ’s wail on the radio, oddly only Dolly Parton was required to give permission and only Dolly reaps the rewards. Whitney gets nothing. In this respect, the U.S. has always been different from most European countries which recognize a right of public performance for the owners of sound recordings.
3. The Digital Performance Right in Sound Recordings Act of 1995 : Recording artists have long lobbied for a right to reap royalties for public performances. The Act finally gave it to them, but only with regard to the Internet. Therefore, to be in compliance under the Act, and not be subject to copyright infringement, you must get a public performance license from the owner of the sound recordings you wish to broadcast over the Internet. Unfortunately, ASCAP , BMI , and SESAC don’t control these licenses, rather the record labels retained these rights for themselves. This means you must contact each and every music publishing company and obtain permission to play their music pursuant to the Act. A daunting task, at best.
The Act is complex and convoluted because it both adds and subtracts sections, clauses, phrases, and words to the existing Copyright Statute . No court or copyright tribunal has officially interpreted the Act . The Act provides for three different types of Internet-based music transmissions: (a) exempt transmissions, (b) subscription transmissions, and (c) interactive transmissions. If you are considering playing, or permitting the downloading or purchasing of music from the Internet, you should consult a copyright attorney concerning your legal and monetary obligations according to the Act .
4. Exempt Transmissions: If you satisfy two criteria, you may broadcast music over the Internet without a license and without incurring any liability for copyright infringement. Your transmission must be non-interactive and non-subscription to be exempt. 17 U.S.C. ß 114(d)(1). A non-interactive transmission is one which does not allow someone to specifically request a song to be played for him. 17 U.S.C. ß 114(j)(4). A non-subscription transmission is one for which consideration is not required to be paid to receive the transmission. 17 U.S.C. ß 114(j)(8) ("A ‘subscription’ transmission is a transmission that is controlled and limited to particular recipients, and for which consideration is required to be paid or otherwise given by or on behalf of the recipient to receive the transmission or a package of transmission including the transmissions.") Some legal commentators argue that even if your website is free, music transmissions from your website are still subscription transmissions because users pay for Internet connect and online fees. This issue will likely be decided by a court.
5. Subscription Transmissions: If your Internet-based music transmission is not exempt from licensing under the Act , 17 U.S.C. ß 114(d)(2), you are entitled to a compulsory license if you follow five criteria. A compulsory license means the record label, or other sound recording owner, cannot say "no" to your request, so you want to fall into this category. Your Internet-based music transmission is subject to compulsory licensing if it:
- is non-interactive, 17 U.S.C. ß 114(j)(4)
- doesn’t exceed the sound recording performance complement, 17 U.S.C. ß 114(j)(7)
- doesn’t publish a program schedule or prior announcement which specifies the songs to be transmitted
- doesn’t automatically switch from one program channel to another, and
- is accompanied by information encoded in the song, such as song title and recording artist.
I’ve defined non-interactive above. To satisfy the sound recording performance complement, 17 U.S.C. ß 114(j)(7), you can play, within any three hour period, three cuts from a CD but no more than two cuts consecutively. Or, you can play four songs from any singer or from a boxed CD set, but no more than three cuts consecutively. So, a triple shot of Springsteen satisfies the Act , but not a quadruple shot.
The Librarian of Congress was due to convene a copyright arbitration panel to determine royalty rates and terms for subscription transmissions which follow the compulsory licensing guidelines. None has been convened, to my knowledge.
6. Interactive Transmissions: Finally, if your transmission of music over the Internet is not exempt, 17 U.S.C. ß 114(d)(1), nor compulsory, 17 U.S.C. ß 114(d)(2), it is an interactive transmission. 17 U.S.C. ß 114(d)(3). Licenses for interactive transmissions must be negotiated separately with each sound recording copyright owner, i.e., each record label. Besides small, independent record labels, the major music publishers haven’t written interactive licensing agreements nor have they set royalty rates and terms for interactive transmissions. It’s anyone guess when they will. Interactive transmissions are subject to specific limitations. See 17 U.S.C. ß 114(d)(3) for more information.
7. Reproduction Right: Finally, some legal commentators argue that whenever music is played over the Internet, copies of such music are made in a variety of places, including the player’s Internet server, the user’s Internet server, the user’s local area network server, and the user’s PC (usually in RAM, but also on a hard disk if the user downloads the music). The right to reproduce, or copy music, is a right which the Copyright Statute grants separately from the right to publicly perform music. 17 U.S.C. ß 106(1), (3). Therefore, if interim copies of music are made, to play music on the Internet, you could conceivably need, in addition to the public performances licenses described in this FAQ, a right to reproduce either or both the musical work and the sound recording. The provisions of the Act don’t resolve this issue (see 17 U.S.C. ß115, as amended) and resolution awaits another day.
8. Companies on the Internet: If you’re considering playing music on the Internet, you’ll need to contact scads of companies. Below is a list of many of the relevant ones:
Music Performing Societies:
ASCAP
(American Society of Composers, Authors, and
Publishers),
BMI
(Broadcast Music, Inc.),
SESAC
(Society of European Authors and Composers)
Music Publishers:
Atlantic
Records
,
Capitol Nashville
,
Capitol Records
,
Elektra
Records
,
EMI
Records
,
MCA
Records
,
Polygram
Records
,
Sony
Records
,
Warner
Brothers
9. Comments: Send me email .
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© 2006 NetGuide Magazine
