Δαφνη Ευτυχια Αρθουρος

"There are only two kinds of programming languages: those people always bitch about and those nobody uses." -- Bjarne Stroustrup

[And a happy Beltane to my friends celebrating it!]

In case anyone is unfamiliar with the abbreviation, "IANAL" means "I am not a lawyer", a standard bit of disclaimer when a layperson on the 'net starts speculating about the law or offering "worth what you paid for it" free advice. I think I know quite a bit more about copyright law than most people, just because I've read various "copyright law for dummies", "intro to copyright for photographers", "intro to copyright for musicians", and "common myths and misperceptions about copyright" web sites, and the US government's own "copyright FAQ simplified for laypeople" page, as well as Lessig's Free Culture: How Big Media Uses Technology and the Law to Lock Down Culture and Control Creativity ... and given just how freaking commonplace the various copyright myths and misperceptions are, it's obvious most people haven't. I know that I know less about copyright than some of my friends, and most of my friends know less about it than a lot of lawyers, and then there are the lawyers who specialize in this stuff. So: while I feel that I have about 1/3 of a clue more clue than most people about copyright stuff, that only adds up to ... about 1/3 of a clue. Admittedly it's been awhile since I reread any of those "things you ought to already know about copyright but probably don't" sites...

So ... this is layperson-with-a-third-of-a-clue speculation and brainstorming which may or may not turn out to have any bearing on reality, but I'm going to throw this out there just in case it lands in front of someone who knows their stuff and has time to respond to my questions here (I know some of my friends have more than two whole clues to rub together regarding copyright, that being part of their jobs, but I don't know whether they'll have tome to respond), or turns out to be something useful that too few people have gotten around to yet. Take every darned paragraph with a grain of "IANAL"-flavoured salt, and check with authoritative sources (unless you are one of those more authoritative sources) to see whether I've misremembered something.

Okay, the very basic background just in case anybody needs it: copyright is, basically, "the right to make copies" (which is why it is not, as some people mistakenly spell it, 'copywrite'). "Copies", as it winds up being in the law, includes performances, recorded or not. The basic idea is that, for a set time (in theory -- though in practice every time Micky Mouse is about to enter the public domain, the duration of copyright gets extended) only the creator of a work has the right to make copies or to grant permission for anyone else to do so ... with certain exceptions (including the grossly misunderstood 'fair use' and the probably better understood but often abused parody). The creator, or hir employer if it's a "work for hire", starts off owning exclusive rights, which can then be rented, sold, or given away like any other property. (We'll leave the argument over whether "intellectual property" should exist for some other day -- today I'm working within the framework of what the law currently is, to the extent that I haven't misunderstood it.) These rights are most often rented, after some sort of negotiation (which may be as simple as "hey, what's your standard rate?"). In general, if you want to use or copy someone else's work, you have to ask permission and probably negotiate compensation. Want to use my photo in a textbook? We'll negotiate. Want to use my song in a television commercial or a movie? We'll negotiate. *cough* In general. But not always.

"Not always," because there's this notion of "compulsory licenses", for specific uses, which go hand in hand with statutory royalties. If you've published a recording of a song and I want to record a cover version of it, I do not have to ask your permission or negotiate a royalty rate. There's a "compulsory mechanical license" that means all I have to do is pay you the royalty amount specified in law for covers before I press copies of my version, and all you can really do about it is cash my check. Because you're compelled to grant me the license, the royalty amount is set by statute instead of negotiation. Note that you do have the option, if you like me a whole heck of a lot -- it's still your work and your copyright after all -- to charge me a smaller royalty or to waive the royalty or to write a letter saying that you trust me to pay you later and are giving me permission to go ahead and press those CDs now. Gotta have that in writing, of course, so I can show it to the CD pressing plant so they know I'm not BSing them. AFAIK, you don't get to insist that I pay you more than the statutory amount, since the law says you're compelled to grant me a license and specifies the standard payment (hence "compulsory license"), but do keep that "IANAL" thing in mind here.

Which brings us to performance royalties. I'm not 100% certain that performance licenses are compulsory, but it makes sense that they would be, since a) there are statutory royalty amounts for different types of performance, and b) it just makes sense that you wouldn't make every single radio station negotiate a separate license with every single copyright-holder whose music they play. For now I'll assume that performance licenses are compulsory unless someone corrects me in the comments. Every time a radio station plays a recording that's still under copyright, they owe a royalty payment. Every time a band performs a song that's still under copyright for an audience, someone owes a royalty payment -- usually the owner of the club or theatre where the concert's taking place, but it could be the band -- which is why when the music industry came down on the Boy Scouts and various summer camps to collect royalties for campfire sing-alongs, however wrong they were from a PR standpoint and a "what decent people should do" standpoint, they were actually legally absolutely correct (as I understand it -- IANAL). This is one of the frequently misunderstood bits, and every so often music industry agents check up on clubs that aren't paying lump-sum royalties and sue them if it turns out they've been hiring cover bands who haven't been paying performance royalties either, and I think it usually comes as a surprise when the club owners learn that they should have been paying royalties (or verifying that the performers had done so) all along. I keep wishing I could sic the RIAA on those folks who blast their car stereos so loudly you can hear them for two blocks (no I am not exaggerating) for not paying royalties for a "public performance" of the recordings...

There are statutory royalties covering how much it costs to play a song on conventional radio, how much it costs to play a song on satellite radio, how much it costs to play a CD at a discotheque, how much it costs to have a band play a song they didn't write in your bar, and how much it costs to stream a song over the Internet. I'm guessing there are statutory royalties covering telephone hold music and elevators. In principle, whoever runs the organization "performing" (which includes playing a recording of) the music, owes performance royalties to the specific copyright holders of each piece of music they play.

In practice, that's too much paperwork -- they'd have to track Every Single Song and exactly how many times it was played and write checks for the right amounts to each and every copyright-holder whose work they'd used. So there's a legal shortcut. A radio station will work out how many songs it plays on average each month, and write a check for that lump-sum amount to an agency that collects and distributes royalty payments. That agency then does some statistical sampling, figures out which copyright-holders get what percentage of the pie, and writes checks to the copyright-holders (usually artists or record companies ... and I get the impression that it's more often the record companies). The system isn't perfect: niche artists, "genre" artists, and local indie artists are so far down in the "noise", statistically, that their cut gets rounded down to zero if they're even noticed in the random sampling at all. On the whole, it works well enough for the folks owed large enough amounts of money to care, so everybody's basically cool with it even if they're getting shortchanged a little ... either that, or the little guys' complaints just aren't being paid any attention. Hmm. Gotta look into that.

And that, at last, brings us to the whole reason I'm writing this: Internet-radio royalties. I had this funny thought about how to turn this whole "jack up the statutory royalties on Internet radio so high that it puts the entire field out of business" crap on its head. I'm just not sure whether I've got all the details right.

Does the compulsory performance license specify an exact amount for each category of performance, or just the largest amount the copyright-holder can insist on? Does it specify that lump sum payments to a particular agency must be used, or do broadcasters have the option of using a different agency or paying copyright-holders directly? Because if I can charge a friend less than the statutory royalty for a compulsory mechanical license if I so choose, why can't I charge a group of broadcasters I want to support less than the compulsory performance royalty? (In fact, I saw a throwaway line in some superficial news article about this that suggested that major web-casters would negotiate discounts with major labels, implying that exactly this is possible.)

So what happens if a bunch of indie artists -- the ones with the most to gain from Internet-radio exposure -- put in writing, "We will only charge $reasonableamount as a performance royalty for Internet radio, instead of the ruinous statutory amount"? Would that mean that suddenly an Internet-radio station would be affordable to operate again as long as it stuck to artists who had given either blanket or specific licenses to use their tunes at the reduced rate? Could this then bite the RIAA in the ass by making its own artists too expensive for Internet-radio and leaving that entire field to the indies and small labels willing to support the medium? Or am I missing or misunderstanding something critically important? And if the paperwork burden of this approach is too high, could a bunch of indie artists band together and start a separate royalty-distribution agency just for these lower-rate artists? They certainly wouldn't be "lost in the noise" there ...

I haven't bumped into this idea elsewhere yet. So what am I missing? Would it work? (Is it already being discussed, just not in the places I'm reading?)