Music Licensing

History of Music Licensing:The very beginning of music licensing began in the 20th century with the creation of ASCAP.  In 1914, a group of composers got together and created the American Society of Composers, Authors, and Publishers which was to be used as a joint pool of music that could then be sold to music users. After it’s creation, ASCAP created a blanket license that would allow for users to use any musical composition for anything by just paying one single licensing fee. This blanket license was beneficial because it made sure that artists were actually getting paid at least some money for the use of their songs. Before ASCAP was created, there was no central company that would collect performance rights royalties for the artists, so lots of money was getting left on the table. However, since ASCAP was the only company working on licensing, they had tremendous leverage that began to push fees to an extremely high amount and because of these extremely high demands, the radio broadcasters created BMI (Broadcast Music, Inc). The main difference between the two companies was ASCAP continued to have strict membership rules, while BMI had open enrollment which allowed for more composers and artists to start collecting on their licensing.The most damaging piece of legislation that would affect music licensing companies were the Consent Decrees that were put into place in 1941. The Consent Decrees were created because of the fear that ASCAP was becoming too similar to trust and needed to have the DOJ step in. In an agreement with the Department of Justice, BMI and ASCAP agreed to a set of rules that included: they were no longer to allowed to have exclusive rights to composers and publishers works, they also could not seek payments for programs that did not contain ASCAP/BMI music, it also required a different set of program and network licenses for broadcasters, and it stated that ASCAP and BMI could not discriminate between users and had to give royalties in a “fair and nondiscriminatory manner.” While these Consent Decrees have been changed some, the underlying rules still stand.Source:http://www.nrbmlc.com/music-licensing/music-licensing-history/(Audio Visual Material)https://www.youtube.com/watch?v=Mwx9m6-z0fE