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President Trump signed landmark Music Modernization Act into Law

President Trump signed the eagerly anticipated Music Modernization Act into law at a ceremony at the White House on Thursday, in the most high-profile event for the music industry in several years. Intended to update music copyright law for the digital era, H.R. 1551 (formally the “Orrin G. Hatch-Bob Goodlatte Music Modernization Act”) accomplishes three key things: making sure songwriters and artists receive royalties on songs recorded before 1972; allocating royalties for music producers; and updating licensing and royalty rules for streaming services to pay rights-holders in a more streamlined fashion, via a new, independent entity. Under the act, many music creators will have a more reliable way of collecting the money that they’re due.

Overview of the Music Modernization Act
The bill reforms the music licensing landscape in four main dimensions.

Section 115 Reform
This section of the bill ends the bulk Notice of Intent (NOI) process through the Copyright Office, which can prevent songwriters from being compensated or compensated in a timely manner for uses of their works.

Under the Music Modernization Act, the digital services would fund a Mechanical Licensing Collective (MLC), and, in turn, be granted blanket mechanical licenses for interactive streaming or
digital downloads of musical works. The MLC would be governed by publishers and self-published songwriters. The MLC would address the challenges digital services face today when attempting to
match songwriters and publishers with recordings.

The bill would also create business efficiencies for the digital services by providing a transparent and publicly accessible database housing song ownership information. Additionally, because the database would publicly identify songs that have not been matched to songwriters and/or publishers, publishers would also be able to claim the rights to songs and get paid for those songs. Songwriters and publishers would also be granted an audit right, which they don’t currently have under Section 115.

Willing Buyer/Willing Seller Standard
Section 115 of the Copyright Act has regulated musical compositions since 1909—before recorded music even existed. Section 115 allows anyone to seek a compulsory license to reproduce a song in
exchange for paying a statutory rate. Current law directs the Copyright Royalty Board (CRB)—the government body responsible for setting the statutory rate—to apply a legal standard to determine rates that does not reflect market value.

The Music Modernization Act replaces the current flawed legal standard with a standard that requires the court to consider free-market conditions when determining rates.

The “Wheel” Approach
Currently, ASCAP and BMI are each assigned to a single, respective rate court judge. Every case must be adjudicated before each performance rights organization’s (PRO’s) respective designated
consent decree judge.

Under the Music Modernization Act, a district judge in the Southern District of New York would be randomly assigned from the wheel of district judges for rate setting disputes. The “wheel” approach would enable BMI and ASCAP, as well as licensees, to go before any judge in the Southern District of New York on a rotating basis—rather than being assigned to a single judge—for the purpose of rate setting disputes. This “wheel” approach ensures that the judge will find the facts afresh for each rate case based on the record in that particular case, without impressions derived from prior cases.

Section 114(i) Repeal
Currently, Section 114(i) of the Copyright Act forbids the federal rate courts overseeing the the consent decrees that govern the two major PROs from considering certain evidence when setting
performance royalty rates for songwriters and composers. The rate court judges are barred from considering sound recording royalty rates as a relevant benchmark when setting performance royalty rates for songwriters and composers. As a result, the playing field is uneven, at the expense of songwriters.

The Music Modernization Act repeals Section 114(i), moving the industry to a fairer system under which PROs and songwriters would have the opportunity to present evidence about the other facets of the music ecosystem to judges for their consideration. This repeal creates the opportunity for songwriters to obtain fairer rates for the public performances of their musical works.

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European Parliament approves controversial new Copyright Directive

The vote by European lawmakers to reform EU copyright law could redefine internet freedom. The fight over the European internet is just getting started. An alliance of tech giants and internet activists lost a battle against content creators seeking more protection for their work.

A multi-year battle that saw media organizations and creative individuals seeking content protection face off against against big tech and internet-freedom activists came to a head in Strasbourg on Wednesday, when the European Parliament voted to update copyright legislation for the age of content-sharing platforms.

MEPs voted 438-226 with 39 abstentions in favor of the EU Copyright Directive that is set to give more power to artists, news and traditional media companies as opposed to tech giants like Facebook, Microsoft and Google.

“This is a good sign for Europe’s creative industry,” said German MEP Axel Voss, who helped move the bill along through parliament. MEPs voted on a range of conflicting amendments prior to the vote, making the make-up of the final draft law not immediately clear.

Two contentious proposals were at the heart of the drama: Article 11, which covers the rights of press publishers, would see newspapers, magazines and other such agencies receive a fee when content platforms link to their stories, so-called “neighboring rights”; and Article 13, which would hold content distributors like YouTube liable for copyright infringement committed on their platforms, an attempt to ensure content producers don’t get ripped off.

The law’s critics fear that Article 11 will be unworkable and Article 13 could lead to “upload filters,” or algorithms that would give tech giants control over what content appears on their platform, effectively censoring information. They warn that overly cautious algorithms could also ban content even when it does not breach copyright law, known as “overblocking.” They also warn of the cost that such a requirement would have for smaller publishing platforms.

Since it was first proposed in 2016, the copyright directive has become a battleground for artists. Many want to stop internet platforms from freely hosting their content, and internet activists, who fear the vaguely-worded rules will crush freedom of expression on the internet. Before existing copyright laws can be updated, however, the approved copyright law bill will now pass for approval to the European Commission, the EU’s executive arm, and the leaders of the EU’s 28-member states.

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Streaming music can now claim 100 million paying customers

During its annual big event yesterday, Apple revealed that its streaming music platform has now been able to accrue 17 million paying customers, even though it is only just over one year old.

That’s a very impressive number, and it makes Apple Music one of the largest services in terms of paying subscriber numbers in the world. The jump in users is not just good news for Apple, it’s good news for the entire music industry. Thanks to some smaller players making big moves and the larger services collecting millions of new users all the time, the streaming music industry can now claim 100 million paying customers around the world, which is a very big deal for the ever-expanding business.

streamingtotals

Just a short time ago, new Spotify hire Troy Carter revealed that his employer now has 39 million paying customers listening to music, which is up significantly from when the company’s CEO tweeted that the Swedish giant had reached 30 million not too long ago. That number is just about the same number of subscribers satellite radio pioneer Sirius XM has collected over the years it has been in business. Add in the tallies of companies like Tidal, Napster, Deezer and a handful of others, and the millions truly begin to add up. In fact, there are probably more than 100 million paying subscribers in the world, but companies like YouTube and SoundCloud won’t reveal the subscription numbers connected to their newly-launched streaming music platforms just yet.

While 100 million is certainly a wonderful marker to pass, there are actually many more people out there streaming away, though not all of them are paying for it. Spotify alone has 100 million users, though only about 30-40% of them are paying for the privilege of ad-free listening. Converting those users already comfortable with the idea of streaming music, while also attracting new users by the boatload, is vital to ensuring that this new form of media consumption is able to survive the coming years.

100 million paying customers means that while there is still a lot that needs to be worked out when it comes to payments, technology, reporting, and so on, streaming music is picking up steam, and the masses have definitely chosen this method as their go-to for accessing music. Streaming music will be better for everyone involved-especially those looking to make a living off the music they create-as the industry grows, and the more people pressing play on songs and paying their monthly dues, the better. This is just one major milestone, and there are sure to be many more in the not-too-distant future, as the rate of people signing up and handing over their credit card information is rising almost as quickly as the numbers themselves.

 

Via Forbes

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German music market grows by 3.6%

The figures, released in July, show that Germany’s recorded music market grew by 3.6% in the first half of 2016. Total revenue from the sales of CDs, vinyl, downloads and the use of streaming services increased in value by a total of 3.6% over the same period in 2015. Audio streaming was the key driver for the growth, with revenue from premium subscriptions and ad-supported services, such as Spotify, Apple Music, Deezer, Napster etc., increasing by 88%.

Vinyl sales also saw a significant increase of 46.2% over the same period in 2015 with its market share rising to 4.3% (compared to 3.1 per cent in the first half of 2015). Sales of CDs declined by 9.6% in the first half of 2016 but remain the dominant format with a 52.3% share of sales. Overall, market figures show a split of 60.4% physical and 39.6% digital sales.

Das Schlossgrabenfest in Darmstadt.
Das Schlossgrabenfest in Darmstadt.

Professor Dieter Gorny, Chairman of Germany’s Federal Music Industry Association (BVMI) said: “These figures indicate that the process of digitisation is occurring even faster than we had previously thought. As music becomes increasingly a digital business, it is more important than ever to establish the right environment for the whole sector to adapt in this new world. A few weeks ago, more than 1,100 musicians and bands signed and sent an open letter to the European Commission, thus showing that artists – who are the nucleus of our entire industry – have serious concerns about the value gap and about their future. The truth is that if we don’t find a solution to this, it might have profound consequences in the future on the art and the profession of making music.”

BVMI Managing Director Dr Florian Drücke said: “The latest figures are heartening for two reasons; firstly, the German market continues to grow, thus enlarging the share of revenue for the whole sector. Secondly, the significant increase we are seeing in audio streaming makes it clear that our industry is successfully adapting to the digital world and has developed a compelling offer for music consumers.

“However, for this transformation to continue we much ensure that music content is sufficiently protected against copyright infringement – both online and offline – and that all participants are able to benefit fairly from the proceeds. Indeed, this is not about the future any longer, but about the digital present.”

Via: ICYMAG

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Spotify is planning to limit the lastest releases to premium-only subscribers

NY Post reported that music streaming giant Spotify is planning to limit the lastest, high-profile releases to premium-only subscribers. Spotify’s new move seems aimed at two things: require a free subscriber to have a Spotify premium account and driving more revenue around music superstars.

There was also a second model under discussion in which content would be limited entirely to premium subscribers. Another one would have “time-restricted exclusives for paying subscribers.” This seems to be what Spotify is aiming for, as the New York Post writes that the Swedish company, under tremendous pressure to create long-term deals with music labels in order to put off a “months-long impasse,” is willing to put in the “windowed” model similar to Hollywood releases. In this translation for streaming music, big releases would be paid only for a time, then free after a substantial wait.

Spotify Premium Index.
Spotify Premium Index.

Spotify is currently operating on “rolling month-to-month” contracts with the big three music companies: Universal Music Group, Sony, and Warner Music Group. Currently, Spotify pays out the big three labels around 58% of revenue. Sources close to the company told the Post that Spotify wants to lower its revenue split, and “make its finances more attractive to potential investors,” with current gross margins around 20 to 25%. Its rival, Apple Music, enjoys a much higher gross margin of close to 40% according to a Bloomberg report.

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Police Scotland have been under sustained criticism after random drug test

Police have been accused of trampling over civil liberties after surprising ­clubbers with snap drug tests.

Customers queuing outside clubs have been approached by officers who swab their hands for traces of illegal ­substances. Those who don’t co-operate are refused entry while those who test positive are questioned and face being searched and arrested.

Last weekend, officers turned up at Club Tropicana in Aberdeen with a drug-detection machine called an itemiser and a sniffer dog. They tested 100 people on the ­Friday and ­Saturday and a CCTV van monitored the club’s entrance.

Club boss Tony Cochrane said he was given an hour’s notice before police arrived and swabbed people in the queue. Officers failed to register any ­positive results for illegal drugs including cannabis, cocaine, ecstasy and heroin.

Police operation: Revellers have been surprised with snap drug tests outside nightclubs (stock photo)
Police operation: Revellers have been surprised with snap drug tests outside nightclubs (stock photo)

Cochrane said: “I ­support an anti-drug policy but I feel this latest action by Police Scotland is a step too far in regards to civil ­liberties. Officers stood at the club entrance and took sample swabs on customers entering with an expectation we should refuse admission to ‘non-compliants’.

When they returned the second night we managed to speak to a duty sergeant who was sympathetic to some of our points. We appreciate the work the police do but they’re achieving nothing with this policy.

People going for a night out are being made to feel like potential criminals. Anyone who saw a huge team of police with a sniffer dog and a CCTV van would think the club is a trouble spot, which is far from reality.

Police found nothing in two nights and said they won’t be back for few months. I’d like to know why they feel the need to come back at all. They’re wasting manpower and resources on making law-abiding citizens feel like suspects.”

Last week Justice Secretary Michael Matheson said the Scottish Government would ban police from stop-and-search unless they had ­”reasonable grounds” to believe a crime was being committed.

Officers have been able to perform consensual searches if a person agrees to co-operate. But a report by human rights ­lawyer John Scott QC said the policy was “of questonable lawfulness and legitmacy with poor ­accountability”.

Stop-and-search figures in ­Scotland are the highest in the UK at 600,000 in a year, with many of them young people. Police Scotland were told to rein in searches over fears that officers were driven by meeting targets rather than fighting crime.

Banning 'stop-and-search': Scottish Justice Secretary Michael Matheson
Banning ‘stop-and-search’: Scottish Justice Secretary Michael Matheson

Scottish Liberal Democrat leader Willie Rennie criticised the stop and swab tactic. He said: “Carrying out such tests without a suspicion of a crime is a heavy handed and indiscriminate tactic by the police. It’s why we stood firmly against industrial scale stop and search. Police Scotland need to review this tactic and explain how this helps address drug taking.”

Graeme Pearson, Scottish Labour justice spokesman and ex-head of the Scottish Drug Enforcement Agency, added: “Where police spring tests upon people and there’s a ­pressure to co-operate, it adds ­concern about the giving of consent and whether operations like this are appropriate. Whether or not there’s ­reasonable suspicion, it doesn’t ­create the kind of co-operative effort that one expects in community ­policing.”

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Task force formed in bid to make EDM events safer

The Los Angeles County Board of Supervisors has unanimously backed the formation of an “Electronic Music Task Force” to provide recommendations on making EDM festivals safer.

The move follows the deaths of two teenagers from suspected drug overdoses at LA’s HARD Summer electronic music festival earlier this summer.

According to Rolling Stone, the task force will “develop recommendations for enforceable health and safety measures and procedures, that would be required for all electronic music festivals on county-owned property”.

“I want to emphasise that our efforts around this motion, above all, are about the health and safety of those attending these events,” said LA County supervisor Hilda. “No lives should be lost while attending any music event.”

The task force, which will include reps from the sheriff’s and fire departments, council and health services, will deliver an initial report within 120 days, while the option of banning all EDM festivals in the county is still being explored.

 

Source : Music Week

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Stems – The world of DJing has changed forever.

What is the Stems ?
A Stem file is an open, multi-channel audio file that contains a track split into four musical elements: bass, drums, vocals, and the melody. The original stereo master of the track is included in the file as the ‘fifth’ stem.
The files are encoded using a 256bit AAC codec which generates a very high quality (mp4) audio file which is compatible for playback on a very wide variety of software and hardware.

A new generation of DJ controllers allows you to manipulate the individual elements of the track to create unique DJ sets. For example, in a live mix you can selectively use the vocal from one track on top of another track, or switch the basslines between two different tracks. These stem elements can also be used to produce or enhance your own tracks.

The Game has Changed
Have you ever wished you could isolate a vocal from one track and seamlessly place it on top of another? Have you ever wanted to effortlessly switch bass lines and drum patterns in the middle of a mix? Well with the latest open multi-track audio format ‘Stems’, creatively minded DJs and producers can remix on the fly with the minimum of fuss.

The new Stems file format allows the user to freely interact with each tracks separate musical elements. This means you can isolate vocals, drums and bass lines for your Stems files, opening up a new world of possibilities to create mixes, mashups and instrumentals in real time.

Learn all about Stems and get your questions answered at stems-music.com – the official online resource for the new audio format.

 

H/T: Native-Instruments / Traxsource / Junodownload

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Apple Music will pay labels just $0.002 per stream during its free trial

It looks like Apple has finally reached a settlement with the independents over Apple Music’s free trial period.

While Apple last week committed to paying music labels during the free trial of Apple Music, the company has yet to formally announce how much they will get.

But the question on the lips of the industry is a familiar one… how much?

Reports suggest that the indies are receiving the equivalent of $0.002 per stream from Apple, and MBW’s sources corroborate this.

But there’s an important extra detail, numerous indies have told us: this is actually a pre-tax figure, certainly in Europe.

That means that in the UK, for instance, the $0.002 would see a further 20% knocked off in VAT – down to $0.0016.

And it will be even worse news in the likes of Ireland (24%), Norway/Sweden (25%), Spin (21%) and Italy (22%).

We know that Apple is paying 58% of Apple Music income to labels in the US – with 13.5% going to publishers – so some very rough maths would suggest that independent publishers would get somewhere around $0.00047 per stream for the three-month free trial.

apple-music

Meanwhile, rumours are circulating about the nature of deals struck by the major labels before the great indie revolt (and Taylor Swift’s timely intervention) took place.

On the face of it, the majors accepted a royalty-free window for the Apple Music trial.

But, no surprise, there almost certainly appears to have been an iTunes-related minimum revenue guarantee included by Apple for the majors.

We’ve even been told a whisper, unverified, that one of the majors scored a guarantee of 80% of their current iTunes revenue. (ie. If Apple Music generates more cash than 80% of their existing iTunes income, great. If it doesn’t, Apple will have to pay it anyway.)

MBW understands that Beggars Group officially inked the Apple Music contract in New York earlier this week.

Martin Mills later said: “We are now delighted to say that we are happy to endorse the deal with Apple Music as it now stands, and look forward to being a big part of a very exciting future.”

According to the leaked North American Sony/Spotify contract from 2011, the major was guaranteed a per stream rate of $0.00225 for the Swedish service’s free tier – although that is probably now outdated.

Spotify says that across premium and free tiers, it pays a blended per-stream rate of around $0.007 to music rightsholders.

 

Source: Music Business Worldwide

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New Music FRIDAYs

From the summer of 2015, major and independent record labels worldwide will typically release new music on FRIDAYs at 00:01 at the local time in each market. The Move was announced in February 2015 following months of consultations with players across the music supply chain in more than 40 countries.

Moving to global release day in 2015

The move is being made to benefit music fans and will ensure that consumers worldwide are able to access new releases on the same day. Release days currently vary from one country to another, causing frustration for consumers in a globalised market when music fans in some parts of the world can listen to and buy new releases before others.

The plan is strongly supported by artist groups. Crispin Hunt, former CEO of the Featured Artist Coalition, says: “A global release day is a great opportunity to re-engage the public with new music and re-ignite the excitement around new releases. We are in a time when the general public’s involvement with music has become more fleeting and somehow less social – a global release day could help change that.”

The view is supported by Paul McGowan, CEO of Hilco, owner of the UK’s largest music retailer HMV. “A global release day is a totally logical move in today’s global music market and Friday is overwhelmingly the right choice for the day. Quite simply, new music should hit the high street when people hit the high street.”

As well as helping music fans, the move will also help artists who want to harness the power of social media to promote their new music. It will also reduce the risk of piracy by narrowing the gap between official release days in different countries. The launch of New Release FRIDAYs will be supported by an international promotional campaign design to engage consumers with new releases.

Research by TNS Ncompass in seven markets worldwide found that 68% of those consumers who expressed an interest in the topic favoured Friday or Saturday as a global release day. The pattern was consistent across the countries involved : Brazil, France, Italy, Malaysia, Spain, Sweden and the US.

Source: IFPI Digtal Music Report 2015

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