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DOJ Could Revise ASCAP, BMI Deals

Music licensing groups welcome update to government consent decrees

The Antitrust Division of the Justice Department is reviewing its consent decrees with music licensing organizations the American Society of Composers, Authors and Publishers and Broadcast Music Inc.

The DOJ says its Antitrust Department “understands that ASCAP, BMI and some other firms in the music industry believe that the consent decrees need to be modified to account for changes in how music is delivered to and experienced by listeners.”

The review will determine whether and how the agreements need to be changed, according to the DOJ.

The rules stem from the 1940s. They were the products of lawsuits brought by the federal government against ASCAP and BMI to address anticompetitive concerns regarding market power each organization acquired through the aggregation of public performance rights held by member songwriters and music publishers. The DOJ periodically reviews the consent decrees and last looked at ASCAP’s agreement in 2001 and BMI’s in 1994.

ASCAP and BMI welcomed the review.

ASCAP President and Chairman Paul Williams said: “Since the ASCAP decree was last reviewed in 2001 — before even the iPod was introduced — new technologies have dramatically transformed the way people listen to music. ASCAP members’ music is now enjoyed by more people, in more places, and on more devices than ever before. But the system for determining how songwriters and composers are compensated has not kept pace, making it increasingly difficult for music creators to earn a living.”

BMI CEO Michael O’Neill echoed that sentiment, saying the organization “understands that the focus needs to be on the songwriters, composers and publishers responsible for the music we all enjoy, on the businesses using our music, and on serving the ever-growing public demand for music.”

As part of its analysis, the DOJ seeks public comment, specifically asking whether the consent decrees harm competition. The DOJ also asks whether the rate-making function currently performed by the rate court be changed to a system of mandatory arbitration and what procedures should be considered to expedite resolution of fee disputes.

Comments should be submitted by email to [email protected] by Aug. 6.

Once it reviews the comments, the antitrust department could then suggest regulation changes, which would be reviewed by a federal court.