2024: The MLC Embarks on Comprehensive Audits of Digital Service Providers
In a groundbreaking move that signals a new era of transparency and accountability in the digital music industry, the Mechanical Licensing Collective (MLC) has initiated comprehensive audits of all digital service providers (DSPs) under its purview. This unprecedented initiative underscores the MLC’s unwavering commitment to safeguarding the rights of songwriters and music publishers in the digital age.
Background: The Music Modernization Act and the MLC
The Music Modernization Act (MMA), enacted in 2018, ushered in a transformative shift in the music licensing landscape. It introduced a new blanket license for musical work mechanicals, replacing the outdated song-by-song licensing system that had long plagued the industry. This legislative overhaul aimed to address the complexities and inefficiencies of the previous system, which had resulted in a substantial pool of unmatched and unpaid publishing royalties, often referred to as “blackbox” royalties.
The MLC, established under the MMA, assumed the responsibility of distributing these “blackbox” royalties and administering the new blanket license. This collective licensing model was designed to streamline the process, ensuring that songwriters and music publishers receive fair compensation for the use of their works on digital platforms.
Auditing DSPs: A Crucial Step Towards Accuracy and Fairness
The MLC’s decision to audit DSPs is a crucial step in fulfilling its statutory obligations under the MMA. These audits aim to verify the accuracy of reported royalties, ensuring that songwriters and music publishers receive their due compensation. The MLC has engaged Jane Bushmaker, a seasoned music industry audit veteran, to oversee these audits, which will be conducted by experienced external audit firms.
The MLC’s audit right, unprecedented in the 115-year history of the U.S. compulsory mechanical license, represents a significant safeguard for songwriters and music publishers. By conducting these audits, the MLC aims to ensure that DSPs comply with their reporting and payment obligations, thereby protecting the rights and livelihoods of music creators.
Protecting Songwriters and Music Publishers: A Shared Responsibility
The MLC’s audit initiative is a testament to its unwavering commitment to protecting the rights of songwriters and music publishers. By ensuring that DSPs accurately report and pay royalties, the MLC is working to create a more equitable and sustainable ecosystem for music creators in the digital age.
This commitment to accuracy and fairness extends beyond the MLC. DSPs have a shared responsibility to ensure that songwriters and music publishers receive their due compensation. By cooperating fully with the MLC’s audits and adhering to their reporting and payment obligations, DSPs can demonstrate their commitment to supporting the creative community and fostering a thriving music industry.
Transparency and Accountability: Building Trust in the Digital Music Ecosystem
The MLC’s pledge to update its members on the results of the DSP audits and clearly identify any recovered monies on royalty statements is a clear indication of its commitment to transparency and accountability. This level of transparency is essential in fostering trust and ensuring that songwriters and music publishers have confidence in the MLC’s ability to protect their rights.
By embracing transparency and accountability, the MLC is setting a new standard for the digital music industry. This commitment to open communication and responsible stewardship of royalties is a beacon of hope for songwriters and music publishers, who have long faced challenges in securing fair compensation for their creative works.
Conclusion: A New Era of Equity and Sustainability in the Digital Music Industry
The MLC’s initiative to audit DSPs marks a watershed moment in the digital music landscape. By ensuring the accuracy of reported royalties and protecting the rights of songwriters and music publishers, the MLC is fulfilling its mission to create a more equitable and sustainable ecosystem for music creators in the digital age.
This is a call to action for all stakeholders in the digital music industry to embrace transparency, accountability, and fairness. By working together, the MLC, DSPs, and music creators can build a sustainable future for the industry, where creativity is celebrated and fairly compensated.