And The Writer Is...with Ross Golan - Ep. 78: Discussing COVID-19 and the CARES Act with David Israelite

Episode Date: April 1, 2020

In today’s MUST-LISTEN episode we catch-up with Season 2 guest, President, and CEO of the National Music Publishers’ Association (NMPA), David Israelite. Israelite is responsible for overseeing al...l aspects of the NMPA’s operations, from legal strategy and implementation to government affairs and advocacy. His tenure to date has produced landmark successes on behalf of songwriters and publishers including the Music Modernization Act (MMA) and the largest CRB rate increase in history, in addition to groundbreaking industry collaboration in royalty rate agreements and raising the profile of the publishing community.We begin our conversation highlighting the new CARES Act which was signed into law on March 27th, 2020 amidst the COVID-19 pandemic which offers various types of provisions to individuals in need of aid. We also discuss the current state of the world and the music industry, specifically how it has affected songwriters and publishers. And we look back on the time in between our last conversation with Israelite in 2017. Learning more about the passing of the MMA (which became law in October 2018), the creation of the Mechanical Licensing Collective (MLC) which will be the central hub from which streaming services will obtain permission to use the millions of songs found on their platforms, details on black-box funds, and more. And The Writers Is… songwriter advocate, David Israelite!For information on The CARES Act visit the NMPA Resource Guide: http://nmpa.org/wp-content/uploads/2020/03/NMPA-Resource-Guide-to-the-CARES-Act-.pdfFor additional information on how to access support please visit:NMPA - http://nmpa.org/SONA - https://www.wearesona.com/NSAI - https://www.nashvillesongwriters.com/ATWI - http://www.andthewriteris.com/To watch the video interview: https://www.youtube.com/andthewriteris Hosted on Acast. See acast.com/privacy for more information.

Transcript
Discussion (0)
Starting point is 00:00:10 Hey guys, we are doing a few updates here with our alumni who we love dearly. And we hope all of you guys are staying healthy, safe, and staying at home during this quarantine. And hope you enjoy listening to a few of our previous guests telling you what's been going on in their life since they did their interview. Here are some updates for the quarantine versions. of Anne the Writer is. Welcome back to Anne the Writer is for your update with David Israelite. Tell me what has been going on with you and everything that's happening in Maryland right now. How are you and your family? We're all doing great. Thank you. NMPA has been working from home now for about three weeks,
Starting point is 00:01:11 and it looks like it's going to be a while longer that that's going to be going on. but we're able to get a lot done still. And so everyone here is on the NMPA team and on my family personally are all doing just fine. So thanks for asking. Now, the last time we spoke was right before the Music Modernization Act passed, which is very exciting. All the things that have happened for songwriters in Washington, D.C. and around the world that have moved forward because of your leadership and what we're doing as a community.
Starting point is 00:01:45 it's obviously very exciting, but the first thing I want to talk about before we get to some updates on what's happening with our community is that the stimulus bill that passed this week includes some relief for musicians and songwriters. And I wanted you to explain how that happened and what songwriters and musicians can do to collect some of that money. Sure. So one of the lasting benefits of the Music Modernization Act was it was a template of how all the different music groups could get together and work for a common goal. And so I think partly because of the success of MMA, when this came up that there was going to be a stimulus bill, a lot of the music groups jumped in together and worked collectively to try to include provisions that would be helpful to segments of the music community. And thankfully, we were able to get quite a bit into the bill that's going to end up being a health. The bill was called the CARES Act, which stood for Coronavirus Aid, Relief, and Economic Security Act. And several of the music groups are coming together and going to put up a common website that's going to go live in the next day or so. The website will be www.W.Musikovidrelief.com. That's musiccovidrelief.com. And on that website will be specific information for how in particular songwriters can take advantage of the different things that were included in the CARES Act.
Starting point is 00:03:25 That information also is available on the NMPA website. And my guess is a lot of the songwriter organizations will be sharing that information as well. But obviously there will be stimulus payments made that will be tiered based on income levels that will provide some of relief to a lot of people. But then there are a couple of other provisions in the bill that we think will be particularly useful for songwriters and producers and people that are not necessarily employees of companies. There's going to be what's known as the pandemic unemployment assistance, which is eligible for self-employed workers. There is going to be a separate provision that will be an SBA emergency economic injury
Starting point is 00:04:09 grant, which will be money that will be distributed again for people. that may qualify from the music community. And then there also is going to be a loan program that also may be helpful to many people in the music community. So a couple of different loan programs, some grant programs, some direct payment programs. It gets pretty complicated, pretty fast, which is why this website is going to include tools
Starting point is 00:04:33 that will help songwriters or other self-employed people navigate through this kind of massive federal bureaucracy. There's also state bureaucracies. in play. But I would say go to that website. Pay attention if you're a songwriter to the information also being put out by NSAI and Sona and Mac, which will also have helpful information. And we're very pleased that we were able to get a lot into this bill given that we're such a small community compared to all the other parts of the American economy that we're lobbying to get relief into this bill. And it really speaks to the music community again coming together and all the
Starting point is 00:05:11 different organizations really pitching in on this common goal. If you are, if you're a new writer or a younger writer, how might you, how might you take advantage of this bill? Sure. Same question with if you're an established writer who's successful. How would the two extremes take? Sure. So there are really five different parts of this program.
Starting point is 00:05:41 The one is the direct relief, which is just going to everybody, and songwriters obviously included. That will be self-explanatory when the government starts sending out those checks, which are really not so much direct payments, but more credits against future taxes. You then have what I mentioned is the pandemic unemployment assistance and the SBA Emergency Economic Injury Grant, which are designed for self-employed people. those two programs will each have their own requirements of how to take advantage of those. And then with regard to the loan programs, there is an SBA economic injury disaster loan and also a paycheck protection program loan. Again, each of those will have specific requirements. Some of them will be harder to take advantage of if you have not made revenue as an independent
Starting point is 00:06:30 contractor or a self-employed person in the past. But again, there'll be some type of relief pretty much available for every. everybody. And what we were very happy about is that some of the programs were obviously directed more toward employees, whereas there's a large segment of the economy, songwriters often included, that are self-employed, that are not considered employees, that may have their own small businesses depending on how they're structured. And a lot of these programs are now going to be targeted to help people like that. So I would say go to the website when it's live in the next 24 hours or so, look at the materials being put out by NMPA and the songwriter groups,
Starting point is 00:07:10 and there'll be a lot of specific information in those. And if you have questions, we're going to do our best to make resources available to answer those questions as well. To give a shout out to the songwriter groups, NSAI, Sona, have obviously been big champions of songwriters. We'll make sure to provide on the and the writer's site also information for those who need to get a link to the site. How do you think the coronavirus has affected the publishing industry and how do you, you know, in a way, sort of pluses, minuses, all the parts that come with people being able to stream more as well?
Starting point is 00:07:56 I mean, how is this affected songwriters? Sure. It's an interesting question. You know, one of the things that if you work in the music business, you know, is that often when you receive money, it's for activity that happened sometime in the past. In fact, probably too far in the past as far as our systems are designed to pay songwriters and publishers. And so one of the things that I think we're going to see is that there's going to be a lag effect in the music industry. That if the economy is taking a real hit that impacts revenue streams for us, we're probably not going to see that for several periods because of the way that the money for,
Starting point is 00:08:34 flows through the system. So, for example, if you've got, you know, restaurants and bars that are going out of business or are hurting, those payments to the PROs then make their way to songwriters and publishers don't happen for several quarters, which means you're not going to necessarily see the impact of that under the same time table that some people in the economy will feel the economic impact if you're an employee of one of those or a provider of services or goods to one of those small businesses. So I think there's going to be a lag effect. I think that for other parts of the industry, it kind of depends.
Starting point is 00:09:10 Obviously, the live industry right now has been just devastated. And for a lot of songwriters, people don't realize this, but a lot of songwriters make revenue by performing live, even if they're not primarily recording artists. And so that part of the songwriter economy is definitely hurt. I think that the early evidence on streaming is that there's been a slight dip in the amount of streaming in the United States, even though there's been maybe a little bit of an uptick worldwide.
Starting point is 00:09:39 It's kind of an interesting phenomenon. People are stuck at home. They have all this time. You might assume that there just would be more music streaming, but I think early evidence suggests that you have people maybe watching more news or listening to more podcasts, and we've actually had a little bit of dip in the streaming numbers early on.
Starting point is 00:09:57 Not sure how that plays out long term. Obviously concerned about live revenue, concerned about public performance in terms of general licensing revenue. Obviously, to the extent you still have physical sales, which is not a giant part of the industry, but it still exists. Harder to do when you don't have stores open to buy those things. So I think from the music industry, it's going to be a delayed effect. It's going to be targeted to certain parts of the industry.
Starting point is 00:10:27 But, you know, overall, I think we're all just going to have to get through it, like a lot of industries are, but in some ways maybe fortunate, unlike some industries that simply are going to go under or be much more directly challenged by the economic impacts of what's going on. Do you feel like there are any advantages that the community can take, you know, when, often when there's a recession, there's, there are certain voids in the, in, in the economy where people can take advantage of certain things. The things that songwriters in the publishing community can do and that you're looking out for in order to resolve certain issues that might exist
Starting point is 00:11:13 or is there any movement as a result of something like this that can help songwriters in the long run? Sure. So one of the things that we're looking at is we're looking for new business opportunities of people that want to come into the economy with music offerings, and is there a way to help accelerate those to generate new streams of income for songwriters and music publishers? And so I had a meeting earlier today
Starting point is 00:11:40 about a handful of concepts that are looking for ways to license music legally that would be new revenue streams, and we're looking for ways to try to accelerate that, to try to bring that into the economy. That would be one thing. For songwriters who also are artists, Obviously, they have fan relationships, and what you're seeing a lot of now is kind of direct fan involvement in supporting people that they care about. And so whether that's a fitness instructor at a gym or a server at a restaurant or a bar, there's a lot of kind of charitable efforts going on right now to help those people that maybe earn their living by gigging or by playing in coffee shops or bars.
Starting point is 00:12:21 And for those people that have direct fan relationships, there are opportunities there, I think, where a lot of Americans, are looking to try to help out the people that make their lives better, which certainly include performing songwriters. But for some of it, it's just going to simply be a challenge to get through. And we're in the early stages of it. So, you know, when we're going to feel the economic impact of some of the loss of this revenue may not be until later this year into next year, which is a little bit scary. Well, let's look on some brighter side of things and talk a little bit about what happens.
Starting point is 00:12:57 since the last time I interviewed you. It feels like a whirlwind of the last couple years. So give us sort of a rundown of what happened. Now the Music Modernization Act passed, and now people are looking around wondering if there were any direct effects, and people are wondering what they can do now to help out songwriters in the future and also to understand the MLC and the timeline of implementing that group.
Starting point is 00:13:31 Sure. So, you know, thanks to really efforts of yours and others who helped carry a lot of water on the Music Modernization Act, we had a minor miracle of the becoming law back in October of 2018 when the president signed the bill that passed Congress unanimously, which was shocking that we could get agreement, but we did. And so now the law is in effect. And there are things in it for producers. There are things in it for recording artists and labels. But let's focus on the things that are in it that directly help songwriters.
Starting point is 00:14:05 There were really four parts of this bill. And it was the majority of the bill that was focused on how to help the songwriting community. Some of those things you won't feel for a little while, but let me walk you through what those things are. First of all, with regard to your performance income, you know, a large majority, of the market is collecting performance revenue from ASCAP and BMI, two of the PROs that are regulated by consent decrees. AsCAP and BMI now have different rules to play by, which should help them deliver higher performance royalties to their songwriters and music publishers. The most important rule is that when they now go to a rate court in front of a federal judge,
Starting point is 00:14:47 they're allowed to introduce evidence about other forms of payment when arguing what the the value is of songs to those services. So, for example, when ASCAP and BMI go to a trial next time against a digital company, they can talk about how much that digital company pays record labels, which before they weren't able to do, and use that evidence as a metric of how much songwriters and publishers should get paid. And so we think that that's going to have a very positive impact on performance royalties, but you're not going to feel that until ASCAP and BMI actually go to rate trials and have those disputes,
Starting point is 00:15:22 which takes some time. When would that, when are those slated to happen? Well, that's the thing. ASCAP and BMI entered into thousands of licenses. And the way that it works is that they first have an opportunity to agree on a rate structure. And if they agree, they never go to a federal court. If they don't agree, then they end up in front of the federal judge. We're hoping that just the threat of having these better tools is going to help ASCAP and
Starting point is 00:15:50 BMI in the negotiations. And so you'll never really know when a licensee offers a little bit more in a negotiation because they know if they go to trial, they might end up with the worst result. There has not yet been a federal trial that has invoked this new evidentiary rule, but those trials can take some time to get to the point where you actually have the trial. And so I think over the next few years, we'll see how that plays out in terms of decisions from the rate court. but maybe more importantly, whether we feel it in some of the negotiated licenses that get done with this new tool that ASCAP and BMI have. The other thing that the bill had was improved tools for how they get paid for mechanical reproductions or interactive streaming.
Starting point is 00:16:36 And we won't know the impact of that until we go to the next CRB trial, which actually starts in January. So when we start this next CRV trial in January of 2021, it's a two-year process, the rules of that trial are now improved for songwriters. We now have what's known as a willing buyer, willing seller rate standard, which means that when we get in front of the three judges, they'd get to tell us the value of our songs for interactive streaming companies. the judge's job now is to set a rate that they think would happen if the songwriters were actually willing sellers of their copyright, which is a much better question than the old way of doing it where the judges were given these four factors, two of which helped the digital companies. But obviously, the thing that most people think about when it comes to the MMA is the creation of this new. Before you go to that, I just want to ask another question, because I think people,
Starting point is 00:17:39 hearing that might want to know, you know, what is the best case scenario for a judge to say your copyrights are worth, you know, because to songwriters, there are. So we all think that our songs are worth a whole lot more than they may be. But we've been so sort of bludgeoned for the last hundred years that maybe we don't really have a good gauge on what the value of our copyrights are, what do you feel like is the likely scenario, best case, and worst case scenario for a judge to rule on the value of a copyright? Sure. So in the last trial that we had under the old rules, the judges gave us a decision that if you
Starting point is 00:18:27 simplify it down to its very basic nature, increase the rates that streaming companies have to pay songwriters by 44%. It was a rate that used to be 10.5% of their revenue that now goes up to at least 15.1% of their revenue, which is a 44.1% increase, and that's at a minimum of how much it will go up. Now, it should be noted that Spotify and Amazon are appealing that decision.
Starting point is 00:18:59 And just a couple of weeks ago, we had oral arguments in the D.C. Federal Court of Appeals, where Amazon and Spotify were on one side of the courtroom. We and actually the Department of Justice who agreed with us were on the other side of the courtroom arguing that that decision should stay in place, but that's for another conversation. So under the old rules, the way that streaming money would be divided for a company like a Spotify or an Amazon or an Apple Music is that a record label would negotiate their deal in a free market. And the record labels were negotiating about somewhere in the neighborhood of 52% of the revenue produced by these services to go to record labels and artists.
Starting point is 00:19:42 The judges in our last trial said that we should get 15.1% of revenue for the songs, the songwriters and the music publishers. So you ended up with a split of record labels in a free market, 52%, songwriters and publishers under the old rules getting 15. That's assuming that, of course, that decision stays intact. Well, now you're asking the court to do a different job, which is what would happen if we were in a free market, if we were willing sellers of our copyrights. Now, this anger is a lot of people when I talk about this, but the only place in the music industry where both songwriters and publishers and artist and record labels are both in a free market. is in the space of synchronization. It's the only place where a licensee has to go to both a record label and a music publisher and negotiate the value of a license or they can't use the copyright.
Starting point is 00:20:47 So if you take the classic example of where a movie or a TV show or a commercial wants to use a song and they go to the record label and they go to the music publisher, both of whom have the power to say no. What happens in the free market is the money gets split 50-50. It's an equal share between the two copyrights. Now, in my wildest dreams, in the next CRB, we would make the argument that as willing sellers of our copyright for the streaming services, it should work like it works in the only other place where we're willing sellers, which is in the synchronization space.
Starting point is 00:21:26 obviously you will hear violent objections from everybody else in the ecosystem about that philosophy but i actually believe that in a real free market that's what would happen the money would be split about equally now obviously Spotify and Amazon and Apple can't pay both parties 52% of their revenue which begs the question of how that pie should get split and so it's a really tough question about where it will end up in the next trial, but you can bet that we're going to be arguing and asking for a bigger share than we got in the last trial that ended up at 15.1% of the revenue. If we have 15.1% of the revenue, what percentage do record labels have? Well, right now they're getting about 52%. So, and if it were to be a 50-50, would that mean that
Starting point is 00:22:22 pie gets split 50-50, or would the stream? services also have to kick in some of their share? Well, I mean, I think our argument would be that the streaming services can afford to pay more. But I do think that if you're being honest about this, you have to get to the point where you acknowledge that it's out of balance right now with how the money is split. And that if you only have 100% to divide among three parties, the digital company, the record label representing artist and the publisher representing songwriters, that the way that it's currently being split is unfair.
Starting point is 00:22:57 And, you know, I don't think anyone is suggesting that we want record labels and artists to take less, but I do think that one of the natural consequences of us being paid what would be a fair market rate if we had really the power to say no and be a willing seller would end up being some type of rebalancing. But our focus is going to be on the streaming companies paying more. That's for sure. Sure. What about the argument, and we'll get back to the MMA, that labels have, well, what about radio, where songwriters get paid everything from radio and artists don't get paid from terrestrial radio.
Starting point is 00:23:34 And obviously, digital radio is different, but can you explain what, how those things are? So in this country, for terrestrial radio, AMFM radio, record labels and artists get nothing. And let's be honest, that is completely unfair. That law should be changed. It's not our fault that they don't get paid anything. We support them getting paid something from broadcast radio, but they've been unable to get that pass through Congress over the objection of the broadcast industry.
Starting point is 00:24:05 Now, what I'm most worried about, and one of the biggest issues for songwriters, I think, in the future, is that when we start to migrate from what was known as terrestrial radio or the AMFM signal to digital radio, which is more like Pandora Radio, I-Heart Radio, Sirius XM Radio. Because artists and record labels do get paid from digital radio, we've had this very bizarre occurrence where everywhere else in the world, radio money is kind of split 50-50, kind of like sync money.
Starting point is 00:24:42 But in the United States, digital radio money is being divided about five to one. record label an artist to songwriter and publisher. And that's, again, a consequence of the different ways in which we're regulated, the way that the consent decrees work with ASCAP and BMI, we've ended up in a situation where it's unfair to labels an artist how AMFM radio works, but eventually that's going to go away. And all we're going to have is digital radio. And we're looking at a future where digital radio is dividing five to one.
Starting point is 00:25:20 the money label and artist versus publisher and songwriter. And so I think that it's one of the biggest challenges we have as an industry, that if you look at how much money terrestrial radio provides to the songwriting community, and you fast forward to a world where every car now is streaming digital radio, not AMFM radio, and you really are left with kind of the same small segment of society that wants to listen to AMFM radio that maybe still buys cassettes, and CDs, you're looking at a future where it used to be the labels and artists that got screwed by how radio worked. It's going to be the songwriters and publishers that get screwed
Starting point is 00:26:00 by how digital radio works. And so we're getting into a different topic, but that's why selectively being able to withdraw rights from the PROs is so important, is so that we have some tool to fight back against how radio is going to work in the future. But again, that's slightly off topic of what we're talking about with the MMA. Well, let's go back to the Music Modernization Act. So we've gone through two of the four. So now let's go to, I assume the MLC is next. Sure.
Starting point is 00:26:32 So the first two were the tools that were given to the PROs. The third was the new rate standard for the next trial. The fourth and the biggest is really the creation of this new mechanical licensing collective and a completely different way to think about a lot of important issues in the music community. So starting on January 1st of next year, so we're only a little more than nine months, I guess, in two days away,
Starting point is 00:26:59 a mechanical licensing collective that has to open its doors and start issuing licenses for all of these interactive streaming companies. And what that's going to change for a songwriter is pretty significant. First of all, songwriters will no longer be paying any commission
Starting point is 00:27:18 on their mechanical royalties. It's going to be the first place that that is true in the world for songwriters, where 100% of the cost of administering the license and delivering the money is going to be paid for by the digital services on top of what they owe in terms of a royalty rate. So the MLC is funded 100% by the digital streaming companies,
Starting point is 00:27:45 which means that when you earn a dollar as a songwriter, you're used to getting something less than a dollar in your royalty statement. There's a commission taken off the top by any society or PRO or even mechanical licensing agency. You now will get a dollar because all of the commission payments are going to be made by someone else. Secondly, we're now going to establish a database that is going to fundamentally change the rules of how we think about data in the music industry. everywhere else in the world today, every database that exists is pretty much proprietary and confidential and not complete. This new database, which again is being funded 100% by digital companies, is going to be transparent and public, which means everyone can have a copy of it, everyone can look at it.
Starting point is 00:28:37 What that means if you're a songwriter is that you now have an opportunity to make sure that the definitive database that decides, or not you get paid has accurate information about your copyrights. It's going to be really important that songwriters and independent publishers feed their data into this database, look at the data, make sure it's accurate, because it's going to be the roadmap of how you get paid. What it also means is that for all of the money that has been stuck in the system because they couldn't figure out who to pay, that money now all gets turned over to the song. writing and music publishing community. And here's what we're going to do with it. First of all, we're going to do something really novel. We're going to publicize the sound recordings that they can't match the underlying copyrights to for the songwriters.
Starting point is 00:29:30 And so if a digital company had a song in their database that earned money and they couldn't find the songwriter, we're now going to just tell you these are the songs that they couldn't match. Here's how much money is associated with it. and you're going to have an opportunity for at least three years to look into that database and claim any money that's yours. And if you find a mistake, you can correct it in one place for all services going forward, which means you no longer are going to have a problem of if Apple found you and knows who to pay, that doesn't mean that Spotify or Amazon or Rhapsody or title or anyone else knows who to pay.
Starting point is 00:30:10 this is going to be a centralized public transparent database, which is really something we've always needed in the music industry. We were unable to do it because no one wanted to pay for it, quite honestly. And part of the deal in the MMA is the digital companies are now paying for it, which is a big difference as well. Can you explain what we would call the black box fund? It's this money that has been sitting there that's where people can't collect it. Can you explain over the last however many years, how where that money's been going?
Starting point is 00:30:45 And, you know, what is, you hear that phrase a lot, the black box fund. So go into that a little bit, what that is. Sure. And I think it's important when we talk about, you know, what we call pending unmatched money. Other people call it black box money is that we have an honest conversation about it. Because I think you have people on both sides of the equation that are not being helpful with how they discuss this issue. So let's start with what's had been going on before the MMA.
Starting point is 00:31:15 When a digital company receives a sound recording from the record label, they're supposed to get with that the absolute definitive publishing information along with it. We know that doesn't happen. We know that we have developed over time a practice of where record labels put out sound recordings without knowing yet the publishing information or it not being completely accurate. accurate. The digital companies have developed practices of just ingesting those sound recordings, even if they didn't have the publishing information. Now, technically, they were copyright infringers. Let's make no bones about it. And several of them got sued, and the lawsuits had merit.
Starting point is 00:31:55 They were using songwriters' copyrights without the proper license, even though it was a compulsory license, the rate had already been set. They weren't going through the proper methods to get the license. And what the digital services were doing then is collecting money, hiring vendors to try to match who to pay, and then running into a brick wall of matching only a certain percentage of it. Every company had a different success rate, maybe 70%, maybe 80%, depending on the company and the vendor they used, of the money they collected was then distributed to the songwriters and publishers. the money that they couldn't distribute stayed at the digital company. They were infringers. They were liable for lawsuits, but the money didn't flow. What's going to happen under the new system is that 100% of the money gets turned over to the MLC,
Starting point is 00:32:50 which is governed by music publishers and self-published songwriters. So they now have control of all that money. The new process that's going to be put in place is, first of all, we're going to do a better job of matching it. But second of all, when we fail to match it, which there will be some failure rate, let's not pretend that the MLC is going to get 100% match right out of the box. They're not. What's going to be fundamentally different is that when the MLC has done everything in its power
Starting point is 00:33:20 to try to match properly but can't, they're going to make it public so that everyone can see what they failed to match. They're going to put all the information out for anyone to look through, to look for their own copyright or money, and then they're going to leave it there for a period of at least three years, so that I suspect there will develop an entire industry of people who make it their business to help songwriters find money that might be theirs. If that money after a three-year period can't be matched,
Starting point is 00:33:52 then what the law provides is that the MLC has the authority to distribute that money using not what people have called market share, but rather by looking at the digital service who they actually paid in the period of time in which the unmatched money was built up, and that becomes the template to distribute the unmatched money. But there's one big difference. The law now says that music publishers are legally required, regardless of what their contracts say, to share at least 50% of that money with their stuff.
Starting point is 00:34:27 songwriters, which means that if a songwriter is, let's just say, hypothetically, has a very bad contract with a publisher and they're not entitled to unmatched money, the law trumps that now. And the law says that publishers have to give at least half of it to the songwriters. Now, in practice, we know that the publishers are going to be distributing a lot more than 50% to their songwriters because the typical situation is a lot of songwriters have co-publishing deals or splits that may be better, and they're going to get paid under the normal course of their contract. But for those songwriters that may find themselves in a worse situation,
Starting point is 00:35:06 they're going to be protected by this law to get at least half that money. It's amazing. I mean, you've been working at this law, you know, since, what was it, 2006, 19- 2005, I think is what an amazing achievement. Thank you for, obviously, pushing for us. And I think it's going to take the whole community to make sure that we make this all work, you know. And it really is. And one other thing that's a benefit that maybe is not going to get recognized, the reason we did this is so that the streaming business environment can explode and create more money.
Starting point is 00:35:45 One of the problems we were having is that streaming companies were violating the law. They were violating our copyrights. They were getting sued. And we were very worried about a situation of where, that doesn't encourage new companies to come into the space and try this. It maybe chases other companies out of the space. Our healthiest future is where we have everybody paying for a music subscription, which can get us to a point that's maybe even better than we ever had been
Starting point is 00:36:12 under the old system of selling pieces of plastic. But we're not going to get there if we can't figure out how to license it and pay it properly. And so, yes, we fixed a lot of specific problems about databases and unmatched, But the overall goal is to create a healthy economy so that we are exploding the amount of paying subscribers so that we're actually generating more legal revenue for songwriters. And I think that a big impact for this law is going to be helping do that, even though it's not going to be directly attributable to the fact that this law is there. You know, I think songwriters have been looking for wins because it always feels like we have been
Starting point is 00:36:53 fighting uphill battles, you know, long before I was alive, but even in the last few years, especially with the creation of the digital services, and to have them also fund the MLC, it's just so many wins all in one bill as long as, you know, these things work. So, you know, again, thank you. I have more questions, but I know we're running out of time. Sure. I just say that it's important that you and the the other songwriter groups, hold everybody accountable. Yeah. Make this thing work together.
Starting point is 00:37:29 I mean, there's a reason why we've invited songwriters into the governance of this, that why they were so involved in drafting the bill is this is really a historic opportunity to create partnerships between publishers and songwriters to do this right. And so, you know, but we need everyone's cooperation to participate. You've got to actually help the MLC do its job. It's no longer a case of where you can just sit back and say, come find me, and if you don't find me, then maybe I'll sue you, and you'll be left with a problem. We need everybody to pitch in and make sure that they're helping the MLC get this right.
Starting point is 00:38:05 Well, we should do another update about some of those things, even that you just said, I'm curious for your thoughts are on the Case Act, I'm curious for your thoughts are on AB5. I'm curious for your thoughts are on a lot of these things that aren't necessarily, you know, I don't know, it looks like the Case Act is unlikely to pass, in this Congress and, you know, AB5, I think we're still trying to figure out what that actually means for songwriters in the publishing industry.
Starting point is 00:38:32 So as those things unfold, we should definitely continue to have conversations about it. Plus, obviously, there are other companies that will be going after shortly, like we did with our big Pelican win. So, you know, again, thank you so much for the update and I hope you guys stay safe over on the East Coast.
Starting point is 00:38:55 Thank you. And thanks for all you do as well. Really appreciate your routes. All right, man. Bye. Take care. Thanks for listening to this episode of And The Writer Is. If you want to hear music from this songwriter I just interviewed, be sure to check out our Spotify playlist or visit our website at and the writer is.com.
Starting point is 00:39:20 If you like what we're doing, please subscribe to us. You can also like us on Facebook and Twitter. And The Writer Is is is produced by Joe Lerlin. London, edited by Miles Berg's month, and published by Big Deal Music. A special thanks to David Silverstein from Mega House Music and Michael White. Until next time, this is Ross Golan.

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