The laws of music are "not in tune with the digital revolution," writes Burt Bacharach in The Wall Street Journal (1/23/14). Burt remembers a time, a very long time ago, when he would make money on every 45 rpm record sold, even if his tune was only the ‘B’ side. That was in 1956, when he was an aspiring composer working in the fabled Brill Building, when there were 45s with ‘B’ sides, sold in record stores. That world is long gone, and yet, Burt says, the laws governing how songwriters get paid – "conceived over 70 years ago" – have not changed.
In the old world, when "vinyl records were the hot new technology," it made sense for Ascap and BMI to "negotiate and collect fees for songwriters" when their work was played commercially – on the radio, or at concerts. The "consent decrees" as they are known, were negotiated by the Justice Department and "were deemed necessary to ensure that these leading licensers charged reasonable rates for the use of music … in public places." The issue, says Burt, is that it requires that "judges set the rates without knowing what deals might be struck in a free market."
The problem, he continues, is that the law is "anachronistic" in today’s "world of ubiquitous headphones where anyone can access 30 million tracks through any mobile device." A result is that "songwriters earn about 8 cents for every 1,000 times Pandora plays their song. If Pandora plays a song 10 million times, it gives the writers less than $300 total." Pandora, he notes, "has a market cap of over $6 billion." Ascap and Pandora are currently "in a rate-court trial … where a judge, rather than the market, will have to determine what songwriters are paid for the use of their work."