Takin Care of Business: The Battle for License Fees

Another step has been taken in the long-running boxing match between music publishers and the licensing organizations entrusted to collect their royalties on one side, and the record labels and digital music providers who share the music with the public on the other.

And all the while, the songwriters are caught in the middle.

Today, the Justice Dept. announced that it will re-assess the agreements that have governed the royalty process for more than seventy years.

ASCAP and BMI, the two largest performing rights organizations, collect almost two billion dollars annually from radio stations, restaurants and any other business who uses music as a part of their business, or to enhance it. But the toughest path, and the most lucrative of late, is in the digital realm. Companies like Pandora have put up fierce resistance when these organizations have sought to collect revenues for their songwriter members.

Much fodder has been spread across the internet about major artists, receiving millions of plays on digital music services, then receiving royalty checks from them for less than $100, leading many music creators to wonder what it would take for them to eke out a living wage in the digital age.

Music companies feel gouged by the monopoly-like control of the licensing groups, and have won recent court battles preventing certain publishers from partially-withdrawing from the pack in the hopes of negotiating higher rates for their catalogs.

Which side should prevail? What do you think?

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