Music News: The Music Modernization Act - Friend or Foe?

On Wednesday, April 25th, the US House of Representatives unanimously approved a bill called the "Music Modernization Act." The bill is being praised by congress for increasing the amount songwriters are paid, update the system for mechanical licensing, and would provide music producers the right to receive royalty payments for their work.

These are all great things for music creators, who absolutely should be paid fairly for the work and effort they put into their compositions. However, there is a flip side to this coin. The bill will require three randomly selected judges to decide on royalty rates for BMI and ASCAP.  This leaves some uncertainty for companies like Spotify and Pandora because it is unclear whether the rate will be higher or lower than what they currently pay.  If one is to assume it will be higher, the pressure for these companies to create a profit will be that much greater.

From a consumer perspective, we now have to wonder, will the monthly rates for these services change?  How much are we willing to pay for free streaming access?

The bill will now move to the Senate Judiciary Committee on May 15th.  With the rate things are moving so far, we will soon know the final fate of the bill and how it will effect the music industry.  The landscape of digital music streaming may soon change.