Competition In Music Licensing — DOJ Has More To Do

By Lawrence White and Thomas Lenard

Lawrence White

As a competition agency, the Antitrust Division should encourage more direct bargaining between copyright holders and music users.

ASCAP and BMI are the two largest music performing rights organizations that represent composers/song writers and their publishers in music copyright license contracts with radio stations, internet and other digital music services, TV and movies, restaurants and bars, and other music distributors. The two PROs have operated under similar antitrust consent decrees since 1941.[1]

With the emergence of new streaming music platforms like Pandora and Spotify, publishers have wanted to partially withdraw their catalogues from the PROs for the purpose of negotiating directly with these platforms. This became a major issue leading up to and during the recent Pandora rate case, with the court determining that partial withdrawal was not permissible under the consent decree.[2]

In the aftermath of the Pandora case, ASCAP and BMI in 2014 requested that the Antitrust Division of the U.S. Department of Justice open a review of the consent decrees, with the aim of modifying the decrees to permit partial withdrawal. The review surfaced a related thorny issue: whether the consent decrees require the two PROs to fully license a work if they represent only a fraction of the ownership.

Read full article as published in Law360.

Lawrence White is the Robert Kavesh Professorship in Economics and the ​Deputy Chair, Economics.