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The Breakdown: What Songwriters Need to Know about the Music Modernization Act and Royalty Payments

Calling all songwriters and music publishers—you may have already heard about the Music Modernization Act, or the MMA for short. But do you know how the law will affect the way you get paid?

Get the full breakdown on the Music Modernization Act, including more print and video resources on our MMA educational resources page.  

Basically, the MMA changes the way songwriters and music publishers are paid statutory mechanical royalties* when their work is streamed on interactive streaming services like Apple Music or Spotify, or sold on downloading services like Amazon Music. Beginning in 2021, a nonprofit entity designated by the Copyright Office, called the Mechanical Licensing Collective, or MLC, will collect and distribute these royalty payments to copyright owners of musical works matched to sound recordings in its database. And down the line, but no earlier than 2023, any unclaimed royalties can start being paid to copyright owners and songwriters of matched works according to each work’s market share. But to get paid, you will need to register your songs with the MLC. Sign up for the Copyright Office’s MMA newsletter to stay up-to-date on important developments, including when registration for the MLC’s database becomes available.

Remember though:

  • The MLC is not a performing rights organization (PRO), and registration with the MLC does not affect your ability to receive musical work royalties from PROs like ASCAP or BMI.
  • The MLC also does not distribute royalties resulting from private agreements, such as those negotiated with record companies, streaming services, or other distributors. Royalties for those uses will be paid according to the parties’ contract.
  • The MLC will only distribute mechanical royalties for use of musical works owned by songwriters or publishers. It will not distribute statutory royalties for use of sound recordings owned by performers, producers, or labels. SoundExchange distributes those royalties.
  • Registering your works with the MLC is not a replacement for registering your works with the U.S. Copyright Office, which can qualify you to go to court and collect statutory damages and attorneys’ fees if your work is infringed.

Want more info? Check out our page on the Music Modernization Act for educational materials, the history of this important law, and more.

*A mechanical license is a license that grants permission to reproduce and distribute recordings of certain musical works. Section 115 of the Copyright Act creates a statutory license for mechanical uses, which users can take advantage by paying required royalties and reporting information related to their use of the license. A copyright owner cannot say “no” to a statutory license for qualifying uses of their works.

 

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