ASCAP – One of many industry groups showing their continued support for the passage of this legislation.

Last month, the Orrin G. Hatch-Bob Goodlatte Music Modernization Act of 2018 (MMA) was officially signed into law. The MMA, which was named after the two Republican lawmakers Senator Orrin Hatch of Utah and Rep. Bob Goodlatte of Virginia, represents the most substantial copyright legislation the industry has seen in decades. The reaction has been positive across all industry groups. Specifically, songwriters, music publishers, and online music services who have long urged for changes to the previous law have demonstrated their content with the results of this new federal legislation.

In summary, the MMA provides solutions to three main industry issues. First, the U.S. Copyright Office has been tasked with setting up a non-profit agency to handle the extensive processing of paperwork required of music streaming service entities to meet industry regulations. Digital music services must comply with many licensing requirements in order to legally make music available. Particularly, this centralized agency will facilitate compliance with acquisition of mechanical licenses. These licenses are what allow digital music services, such as Apple Music and Spotify, to copy and distribute music. Second, the MMA codifies the process by which audio engineers and producers who participated in musical recordings receive royalty payments when their sound recordings are played on online and satellite radio services. Finally, digital music services will now have to pay for their use of songs recorded and released before February, 1972. Although historically these recordings have received protection from some state laws, they were previously not protected by federal copyright law.

Digital Media Association (DiMA) CEO, Chris Harrison, said it well, “Much has changed in the music industry in the digital age, with online streaming driving increased revenues for creators and copyright owners alike.” DPP Partner Tony Peyrot notes ”The Music Modernization Act moves the music industry into the streaming age and benefits many of our clients by increasing their earnings, but also increasing the value of their catalogues, which can be sold and if structured properly can qualify for capital gain treatment.”

The MMA has bridged the music licensing laws with the 21st Century and will mean greater transparency and efficiency within the music industry and its players.