Welcome, everybody. Welcome. Apologize for the lack of space and lack of sandwiches. More people showed up than we were expecting. If you were expecting that jay z would be on this panel, i apologize. I dont think he was available. But this is Congressional Internet Caucus Academy briefing. Weve been doing these things since 1996. A pretty remarkable span of time. Informative issues, discussions on critical internet issues as we see them. Were policy agnostic but try to provide a good baseline on understanding of key issues. Todays panel in the era of streaming who is a bigger music mogul jay z or congress. This is with congressional in conjunction with congressional internet caucus. The cochairs of caucus on the senate side are chairman john thune and patrick leahy. On the host side congresswoman anna escru. Congressman collins would be cochair on the caucus and were thrilled to have him. The reality is that for members participating in briefings and hosting briefings in conjunction with us, without any particular policy approach or advocacy, its really a brave thing to do. They want more information and education on these really difficult issues. So i really appreciate their help and support on that kind of mission. So my name is tim lordan, congressional director of house academy. A little housekeeping. Well be Live Streaming this. It will be on cspan today live, cspan. Org, but also tonight on prime time on cspan television. The hashtag today is music moguls. Follow along. Podcast audio and video of this afterwards. So let me just start off by kind of setting the stage here. This is supposed to be an educational event. Were using title of who is music mogul, jay z, taylor swift. To illustrate the fact what a lot of people dont know since the beginning congress has been very, very very involved in music. A lot of people dont know that. A lot of people dont understand where congress is involved in the federal government and congress has oversight of those things. Youd be kind of surprised to find that out. Were going to go into more detail on that in just a minute. So as far as the speakers go, ill introduce you to speakers in a second. Theres a lot of players in the marketplace and its really hard to understand. I apologize, should be about 20 people up here at least representing different perspectives. We didnt really have the space or the time to do that. So this is a good group of folks. Let me just introduce them kind of alphabetically. To my right danielle aguirre, National MusicPublishers Association. Next to her kevin erickson, future of music coalition. Kevin is an artist, hes a songwriter, appear hes a producer. And then next to him is julia, Vice President of Global Policy for sound exchange and shell explain what that is and what that organization does. Then next to her is curtis, who is the executive Vice President of the National Association of broadcasters. Finally at the end. Senior policy counsel for dpt and Communications Industry association. In her own rightal alley is a singer and songwriter. Were thrilled to have this group of folks. Lets define what a music mogul is. Theres money. Jay z forbes money. Forbes reported recently jayz broke a billion dollars. Thats a lot. When it comes to moguls influence is really important. Its just really part of our national song. The power to krael your creativity in your music, thats where it gets a little bit interesting where over the course of the last few centuries congress has tried get involved to be a part of how musicians get compensated, how they can control their copyright and thats really the harlt of what were talking about as a music mogul, who can control music. Just to go way back 200 years since the beginning of the species, song and music has been such an important part of who we are as human beings. Its been around to tell stories, to tell our history, to inspire us. Its really hard to underestimate the impact and influence of music and song when it comes to us as a species. It hasnt been until recently when we started to be able to control our music. 200 years ago they werent able to coppery right them and werent able to record them. But fortunately at the begin ofg the republic here in the United States in about 1790 there was the first copyright acting and during that Time Congress actually gave a copyright if the composition, the notes and lyrics of the music somebody would write. And that was in 1790. And it wasnt, you know, until about a hundred years later that Thomas Edison gave us the ability to kind of capture the performance of that sound, of that song onto a phonograph. And weve been recording on different media ever since. And that was a recent development. And finally over the half century weve created new ways to kind of take that sound recording of that music and tra transmit it to larger audiences. Broadcast radio came about the early part of the 20th century, then cable television. Then we launched satellites into space, and then eventually the internet came along. So theres been all this new development on how we can kind of transmit the sound recordings and thats where it gets really complicated. So to on the way over here we all took an uber from my office and the uber driver was really chatty asking where you going, whats going on in rayburn because they could see the destination on the app and i said were going to talk about destination moguls and congress. He said whats that about . Turns out like look at your dashboard here and he had his apps all displayed on his smart phone and things like that. I said every button you see there is kind of controlled by a different Regulatory Regime and artists and songwriters and Music Publishers are compensated differently depending on the button you push. So lets say youre going to play im all about that bass by meghan trainor. The composition for that would be very different for each one of those services. You have a button for instance he had a spotify app on his dashboard. And thats what wed call interactive music streaming. Which means you can specify which songs you want to listen to. Then there was a pandora app. You cant control it, maybe you can fast forward it but basically you get what you get. It keeps coming at you. And then there was another button i think his itunes play list. So the music he downloaded there were songs he copied and scored on his computer. And then lastly not lastly. Then theres the fm button so if you were to press it and get really lucky meghan comes on thats the same song but its analog and you tune your dial to it and it catches that analog transmission and thats different. Were not going to talk about cable because its kind of hard to drive with a cable attached to your car. So he looked at me like i was nuts but its actually true, and we dont think about that when we walk down the street or get in our car and listen to the music. We dont really give it much thought. But behind the scenes congress is heavily involved. To kind of flesh this out who the players are in the space so we have a better understanding let me go to Kevin Erikson whos going to lay out who the players are and what the copyrights are involved in this. Last year when i was running around on the hill working on the music modernization act i had some Congress People said this is hard to understand. Can you explain it to me like im 5. And so ive got a puppet. Shes written this really great song. And so to market that song to bring it out to the marketplace and potentially get tv and movie syncs and also get it out to audiences she partners with a publisher. And so weve got a publisher here. And so the publishers job is to shes very good at her job. He helps get that out to audiences and gets it where she can potentially approach recording artists to see if they want to record that song. Do you want to hold your constituent here . Ive got a hat. And so he does a really good job and shes able to get hats are flying everywhere already. So weve got rickey the recording artist here and he agrees to record the song. And so he goes into the studio, and he comes out of the studio with a completed sound recording, and now this is different copy rat than the notes and words on paper. And the money, the revenue port flows different. So rickey comes out of the studio with this sound recording. Rickey partners with a record label. The record label helps rickey market that sound recording. They own the master for the sound recording. They own the intellectual copyright embedded in that sound recording. I want you to notice i want you to notice their hats are different colors here because weve got two sound recordings. Red hats here, those are the notes and the words. The music composition. When you think through licensing its really helpful to think through these two copyrights separately because licensing and compensation works differently for each one. Money from the sound recording goes to rickey the recording artists and record label. In most cases a company that wants to use money has to arrange a license for both the composition and sound recording. They have to make sure that both sally and rickey get paid. There is one big exception. Sometimes a Single Person will play multiple roles. For example, sallie mae decided im really talented, im going to choose to record my own song and im comfortable publishing it and releasing it myself. So shes going to act as her own publisher and record label. So shed be wearing all four of these hats. But in that case its still helpful in understanding how the licensing works to think through each one of those Revenue Streams differently. Alternatively sometimes a lot of people Work Together to create a music composition. So you might have ten different songwriters working together to write a song with ten different people representing them. Congress role then has a lot to do with determining how much if anything each of these four puppets gets paid and how the money gets to them. This also Means Congress has a role in determining what kind of Music Services exist, what their offerings are, how much they cost and whether they have any special obligations to the listening public in terms of localism, diversity user privacy and sponsorship. Sometimes congress dedo that in their oversight role. And as new technology is adopted theres new ways it works for listeners and that has meant new laws that setup systems that make sure the money goes where its supposed to go. So performing rights organizations go around to different kind of Service Agents and i take that money and pay salary the songwriter and pay the publisher. Those first really were setup in the early days of radio and now we have four major performing rights organizations on the composition side. And then later on julia will talk more about this but sound exchange was setup. Teal hat. Sound exchange job was to pay these guys, the artists and the label. There you go. And then most recently as part of the music modernization act a new body called the mlc was setup and when thats fully operational their job will be to collect mechanical royalties in the Digital Space from Services Like spotify, apple music. And these will be paid to the publisher and then the publisher in turn will pay the songwriter. I think thats good. Thats a good start. And one of the thank you, i was a little nervous about that but that was great. I think one of the things i mentioned there are a lot of people representative out there and its a huge oversight we dont have a Performance Rights organization up here, a pro. As kevin mentioned those and basically ill let daniel explain at some point why they came into existence but lets go to ally really quickly to elaborate on the sound recording side. And i think recently you might have heard that taylor swift had been upset her first four albums of sound recordings and masters had left her control. So maybe ally can explain what that means and kevin just had the tape of a fictional sound recording there, so ally . Yeah, so im happy to follow up on kevins presentation. As kevin mentioned theres the two copyrights. Theres the composition musical work which is the songwriter writes the song, they have have the music copyright fix and he showed all the different intermediaries that help license out the different rights and then theres the sound recording side which is the artist and label, that kind of side. But one thing we havent really discussed yet is in addition to music, music copyright was really complicated. So in addition to there being the two copyrights, copyright is often described as a bundle of rights, so if youre the copyright owner, youve got exclusive right to do a bunch of different things. Theres a right to reproduce, distribute, right to publicly perform, right to publicly display, right to perform derivative works. Those interest the main ones. So a lot what were going to be talking about today is just the Public Performance of it. Private performance if youre sitting in the shower youre not going a to have to pay, thats fine. But a lot of various entities will help license these rights rights out. And this also affects anyplace where music is played. Thats both restaurants and bars that have the radio or spotify playing in there. Live music is played in a lot of different establishments as well, so a lot of times these different venues will have collective license to help distribute these. Theres been talk of masters and the masters is the individual sound recording once its completed all the different people, the music pruders thats fixing masters. Theres also a lot of intersection with other areas of law including contract law, employment law. Theres so many different intersections that copyright intersects with. So the master recording, a lot of times when artists especially that the beginning of their career theyll sign with different stakeholders in order to help fund theyre making music. But its pretty centered for artists to not own these master recordings. Sometimes later in your career theres ways to have the rights given back to you or you can find them back when youre a music mogul like an artist like jayz, but taylor swift was not able to. And she had written about it. Theres some controversy about it, and i think that shows just that even people that have power, it can be really complicated figuring out who is able to retain these important pieces of music, but also it was the right would tell us its really just being transferred from one owner to his holding company. So it didnt really change that much for her, but it helped people talking about this issue a lot. Another thing that happened with masters recently you might have heard there was new recording and some preiconic 1970s music so that was pretty devastating fire. The music act did change some of the things that affect day to day music redistribution, music production. Theres so many people affected by music and that own different pieces of the music marketplace puzzle. But, yeah, that bill really as some of you may know if you were interning in congress, work in Congress Last year, that was a pretty big thing happened last year, there was a consensus bill that changed some of these important consensus rules and built a lot of history that we know that congress had set in the past. And so part of it is that theyre dealing with rules that were written for player pianoes and then trying to figure out how does this apply to streaming. Its a really big challenge. A lot of people came in a room together a passed a consensus bill. Thomas edison gave us the ability to record sound into a sound recording like tell us whats masters and over the years new technologies came along to take that sound recording and transmit it to audiences like radio broadcast, telephone, the internet, satellites. And thats where things, as that happens over a period of time, Like Congress jumps in to deal with that technology and try to figure all this out. Thats why it might be complicated. So ally just talked about the sound recording and performance right. The other part of the copyright as kevin detailed is the actual notes that are written down and actually created. And so the people that represent them are the National MusicPublishers Association in part, thats all your members. So daniel, if you could explain, elaborate on the composition copyright and what it means for the different types of transitions we have. Sure. Hey, everyone, im daniel, im from the national Publishers Association. We represent publishers and their song writing partners. Ill get into it a little bit more, but there is a very wellknown songwriter based out of nashville by the name of Thomas Miller and he said often and hes testified on the hill a number of times and song writing is one of the biggest businesses but it also happens to be heavily regulated by congress. It has almost 70 of its revenue regulated by congress through various laws as well as what ill get into letter, Consent Decrees that are governed by the department of justice. And its a very small industry. Its a the entire industry both publishers and songwriters. Its probably 2 to 3 billion industry in the United States. And if you think about how you listen to music today whether its spotify or apple music or serious xm you know that any of those companies individually have multiple billions more than our entire industry. And yet are not as heavily regulated. And so it is interesting because when you think about how you listen to music, what you probably dont know is how music is originally created by songwriters and then help to be distributed by publishers who help songwriters in a lot more ways than just distribution. They give advances to help songwriters create music and live while theyre creating music. They help them partner with other writers so they can help write songs. They help partner with artists so they can help reco