IMPORTANT: Changes To Music Licensing May Impact Any Performance At Your Venue

Some important information about changes to music performance rights came to my attention today and I wanted to share it with readers.

Apparently the consent decrees under which ASCAP & BMI operate are up for review by the Department of Justice. The public comment phase is ending on Friday, August 9.  You can find out more about the consent decrees on the MIC Coalition website.

Basically, because ASCAP & BMI operate akin to monopolies, they and other performing rights organizations (PRO) are limited as to what they are able to do when licensing performing rights. They want these limits loosened. You can provide feedback to the Department of Justice here.

Even with these limits, dealing with these companies is often confusing and criteria seems inconsistent. Many have felt they were forced into purchasing broader licenses than they needed.

Today I received a huge flurry of emails urging myself and others to oppose the loosening. I was confused about why there was this sudden urgency when the public comment phase opened at the start of June. I started to wonder if there was an effort to create a huge sense of urgency by rallying support at a late date. Especially since there were initially few details provided about why one should voice their opposition.

Come to find out, the reason is that a large number of organizations across the country received revised licensing agreements from BMI this week containing some alarming changes. There is some suspicion they timed the mailing to hit toward the end of the public comment phase.

Here is a page of the agreement that is causing the biggest uproar.

In section 1 (g), terminology has been changed from “Gross Ticket Revenue” to “Gross Revenue.”  According to the new definition, in addition to ticket sales, calculation of a fee will now be based upon revenue from sales on the secondary ticket market, service charges, handling charges, VIP packages, advertising revenue, box suites, sponsorships, merchandise, concessions and parking.

So essentially, if you have a sponsor for your show; sell VIP packages, merchandise, food, and charge for parking, all that gets factored in to what you pay BMI rather than just ticket sales as was the case in the past.

From what I am told, the definition of “licensee” has been expanded to include a wider range of activities.

For events without an admission charge, the definition of what is included in the fee calculation has been expanded from a flat fee based on seating capacity to one based on entertainment expenses like room, board and transportation costs for the artist.

There are other problematic issues which are a little difficult to explain in a blog post and might not apply widely to many venues. I suspect there are problems that people have yet to discover.  If you do any sort of licensing with folks like BMI and ASCAP or if you have been trying to fly under the radar, you want to pay attention to this.

If you don’t think this applies to you at all, but you have live music performance, you may find that it does. That band that plays at your museum during First Fridays is probably subject to music licensing.

With more opportunities for revenue available, especially if the strictures of the consent decrees are loosened, there is more incentive find the places that have been trying to slide under the radar.

If you have concerns, check out the MIC Coalition website to learn more or provide feedback to the DOJ.  Also –read any new licensing agreements you get very, very carefully.

 

About Joe Patti

I have been writing Butts in the Seats (BitS) on topics of arts and cultural administration since 2004 (yikes!). Given the ever evolving concerns facing the sector, I have yet to exhaust the available subject matter. In addition to BitS, I am a founding contributor to the ArtsHacker (artshacker.com) website where I focus on topics related to boards, law, governance, policy and practice.

I am also an evangelist for the effort to Build Public Will For Arts and Culture being helmed by Arts Midwest and the Metropolitan Group. (http://www.creatingconnection.org/about/)

I am currently the Director of the Grand Opera House in Macon, GA.

Among the things I am most proud are having produced an opera in the Hawaiian language and a dance drama about Hawaii's snow goddess Poli'ahu while working as a Theater Manager in Hawaii. Though there are many more highlights than there is space here to list.

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