CMU Daily 25.07.18: Campaigners fear Music Modernization Act could falter because of HFA intervention, Billy McFarland reaches deal with SEC over Fyre Festival fraud

Campaigners fear Music Modernization Act could falter because of HFA intervention
Hopes that the safe harbour reforming European Copyright Directive would be passed by the European Parliament earlier this month were scuppered in no small part down to some last minute lobbying efforts led by Google. Now over in the US the music community fears major copyright reforms in Congress could also be scuppered by some last minute lobbying efforts, though this time by someone closer to home.

A number of the organisations involved in constructing American's Music Modernization Act yesterday hit out at the owner of licensing firm the Harry Fox Agency and collecting society SESAC. Campaigners argue that very-late-in-the-day efforts by private equity outfit Blackstone to amend the copyright reforming legislation could result in the whole act falling down at the final hurdle, preventing much needed music licensing reforms.

There are various elements to the MMA – which actually brings together a number of different music-related copyright proposals – but at its core are efforts to fix the mechanical rights mess that has hindered the streaming music market Stateside.

Streams exploit both the performing rights and the mechanical rights of the song copyright. In most countries there are collecting societies (often a single society) that can provide streaming services with blanket licences covering both elements of the copyright. This means a service is fully licensed for all the songs streaming on its platform, even where it doesn't have a direct deal with a music publisher.

In the US, there are four collecting societies that together represent performing rights – BMI, ASCAP, GMR and SESAC – but there is no society for mechanical rights and therefore no blanket licence available. Which means that services need to have relationships with each publisher and songwriter whose songs appear on their platform.

There is a compulsory licence covering mechanical rights in the US, so the process for licensing those rights and the rates services must pay is set in law. However, services still need to identify what songs they are using and who owns them, so they can provide the paperwork and payments required by the compulsory licence.

With no one-stop central database of music rights ownership information available, streaming services (and US record companies, who license mechanical rights on CDs and downloads) often rely on third party agencies to identify rights owners and do all the admin required to make sure they get paid. Agencies like the Harry Fox Agency, which used to be owned by the American music publishing sector, but which was acquired by SESAC in 2015, which in turn was bought by private equity types Blackstone last year.

It has to be said that HFA hasn't done a great job in ensuring every music publisher and songwriter has been paid their mechanical royalties, resulting in multiple copyright infringement lawsuits against its streaming platform clients, most notably Spotify.

The MMA, if passed, will set up a new collecting society that will be empowered to grant a blanket licence to streaming services relying on the compulsory licence to cover song rights. It will work a lot like SoundExchange, the US collecting society that administers another compulsory licence, in that case for the exploitation of the digital performing rights that come with the sound recording copyright.

This new society and licence should go some way to sorting out the massive mess that is mechanical rights licensing in the US and bring the American system more in line with what happens elsewhere in the world. Though the creation of the new society and the new licence might mean a lot less work for companies like HFA. Although said new society will need suppliers and HFA – and its competitors – could compete for that work.

Either way, current HFA owner Blackstone has been busy trying to get last minute amendments made to the MMA, which was passed by the House Of Representatives in a super speedy fashion, but which is getting more scrutiny in Senate. Although its proposals are seemingly designed to mainly protect HFA's interests, Blackstone is appealing to the distain for anything that looks like a monopoly that is innate in most American politicians.

Although negotiations continue, one of the organisations backing the MMA - Nashville Songwriters Association International – said in an email to its members yesterday that what Blackstone are currently proposing will likely cause the whole act to collapse.

It states: "The Music Modernization Act provides a simple answer to a very complex problem in music licensing. One of the main reasons the streaming companies have agreed to a fair rate standard that will likely result in a royalty hike for songwriters is efficiency; so they won't have to go to a large number of multiple sources to obtain mechanical licenses. Instead they will get one blanket licence from the new Music Licensing Collective (MLC) run by songwriters and music publishers".

Regarding the new amendments now being touted, it goes on: "Blackstone's proposal would legally require each streaming service to hire another company to issue licenses, collect and distribute royalties in addition to the MLC. This added step would be costly to songwriters, who will pay nothing to the MLC and collect 100% of their royalties, because we've already negotiated with streaming companies to get them to pay the admin costs!"

It then adds: "This proposed amendment is an attempt to make sure the Harry Fox Agency keeps their current business by forcing the death of the MMA, or gets more business because their proposal forces streaming companies to hire an agency in addition to the MLC to issue and administrate mechanical licences".

NSAI then confirms that the Digital Media Association, which represents the streaming companies, will not back Blackstone's proposed amendments. "Neither will music publishers, record companies, NSAI or anyone else who worked for years to create a bill that Blackstone is trying to kill at the very last minute" it then adds.

Another campaigning group which has been working hard on the MMA – Songwriters Of North America – also wrote to their members and supporters yesterday about the Blackstone proposals. It states in no uncertain terms: "The performance rights organisation SESAC, along with some other very recent players, is actively pushing an amendment in the US Senate that could effectively kill the Music Modernization Act".

Noting that HFA could pitch its services to the new society that the MMA will create, it goes on: "Nothing in the MMA precludes Harry Fox from competing to become a vendor of the MLC. Vendors will be required under the new law to curate data, match claims, locate rights-holders, etc. And if they can convince the board of songwriters and publishers that they can do the best job for us, then they will get the gig. But Blackstone doesn't want to do that. They want to kill the MLC and have the playing field all to themselves".

Referencing the recent intervention of a certain Senator Ted Cruz on all things MMA, SONA then adds: "Lucky for [Blackstone], they found a friend in one senator from Texas who loves the free market and hates government-created entities, particularly ones with the word 'collective' in them".

"In their amendment proposal", SONA continues, Blackstone "describe the MLC as 'a single, European-style government regulated monopoly... antithetical to the free market'". This, of course, ignores the parallels between the new society the MMA will create and the very American-style SoundExchange.

SONA then points out all the negotiating that has gone on at their end to ensure that self-publishing songwriters have representation on the board of the new society. "In the Blackstone amendment, an MLC governing board has little to govern", it says. "It practically mandates that the Harry Fox Agency take the place of the MLC, and without any of the oversight and accountability that we all fought so hard for".

Although Blackstone's intervention is about protecting the interests of its HFA business, the fallout could have a negative impact on SESAC, which relies much more on its relationships with songwriters themselves. Most collecting societies are owned by their members, making SESAC's ownership – by private equity – unusual. If Blackstone's wheelings and dealings cause the MMA to fall, it could make songwriters allied to SESAC question whether the owners of their collecting society really have their best interests at heart.

And it's the timing of that intervention that is proving most controversial among MMA supporters. While there may well be compromises that can be made to allay some of Blackstone's concerns without destroying the MMA entirely, many are asking why SESAC and HFA didn't raise these issues previously.

It has been much noted how lobbying efforts to push the MMA through has seen unprecedented collaboration between organisations representing artists, songwriters, labels, publishers and streaming services. There were therefore numerous opportunities, campaigners say, for Blackstone to join this conversation when the MMA was being drafted, so that HFA and SESAC could have been part of the music community consensus in Congress, rather than leading the charge against it.

This was a point emphasised by another of the collecting societies involved in this debate, BMI, which yesterday said it hoped these last minute issues could be resolved.

In a statement, the society stated: "The Music Modernization Act represents an historic opportunity to enact meaningful music licensing reform. The bill is the product of unprecedented collaboration among music stakeholders and passed unanimously through the House Judiciary Committee, the full House, and the Senate Judiciary Committee".

It went on: "BMI is disappointed that at this late stage, the MMA is being endangered by last minute asks. During the long process of drafting this bill, BMI, like many others, had to compromise on certain provisions in order to achieve a final result that benefits the industry as a whole. We hope that the parties currently in disagreement can work together to resolve their issues, allowing this important piece of legislation to move forward".

For its part, Blackstone told reporters yesterday that it "strongly supports music modernisation, and we are confident legislation will be signed into law this year as long as all parties continue working in the same cooperative spirit that has characterised the process so far".

Meanwhile a spokesperson for SESAC said it was "committed to working towards a version of the Music Modernization Act that retains all of the benefits for writers, publishers and [streaming services] and which will move music licensing into the 21st Century while supporting a competitive market in music rights administration. We expect that as the Senate continues to work through these issues with input from concerned and well-meaning stakeholders, an appropriate resolution will be reached and the MMA will be passed before the end of the year".

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Billy McFarland reaches deal with SEC over Fyre Festival fraud
Occasional festival promoter and frequent fraudster Billy McFarland has settled a case being pursued against him by the US Securities And Exchange Commission in relation to various fraudulent activities that occurred in the run up to the failed Fyre Festival.

McFarland, of course, set up the Fyre Festival with his celebrity pal Ja Rule. The event, which promised to be a super luxury experience in the Bahamas, was linked to a talent booking app McFarland was trying to get off the ground. But the festival collapsed just as it was getting started when it emerged McFarland had failed to put in place the infrastructure for even a basic event, let alone the luxury set-up ticket-buyers had been promised.

A flood of litigation followed the collapse of the Fyre Festival and its associated businesses, with ticket-buyers, suppliers and investors among those to go legal. There were also criminal charges of fraud filed against McFarland and an SEC investigation.

The latter has now come to an end with the regulator reaching a deal with McFarland and two of his former business associates. McFarland himself will not have to hand over any money as part of that settlement, mainly because of monies already forfeited as part of the criminal case, which are in the region of $27.4 million. He has, however, agreed to never act as an officer or director in any publicly-traded company ever again.

According to Law360, the SEC has also settled with one Grant Margolin, who worked with McFarland in a marketing role, and Daniel Simon, who created fraudulent documents for the Fyre Festival chief without verifying the accuracy of the information. They will hand over $35,000 and $15,000 respectively.

Among the revelations unearthed by the SEC investigation are that McFarland told investors he had booked artists including Jennifer Lopez, the Foo Fighters and Selena Gomez, when in fact his company had no relationships with any of those acts. He also created fake statements that claimed he owned millions in Facebook stock which were used as collateral to guarantee investments being made by his financial backers.

In the separate criminal investigation into his business affairs, the Fyre man pleaded guilty to two charges of wire fraud back in March. He reached a plea deal with prosecutors and was due to be sentenced last month. But sentencing was postponed following new allegations of fraud relating to a business set up after the Fyre Festival's collapse.

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Fucked Up sign to Merge
Merge Records announced earlier this week that it has signed Fucked Up to a new record deal. The band will release a new album, 'Dose Your Dreams', through the label on 5 Oct.

Frequent Fucked Up collaborator Owen Pallett, who composed string parts for the new album, says of the record: "I was sent an unfinished version of 'Dose Your Dreams' so that I might contribute string parts. I couldn't stop listening to the rough mixes I received".

He went on: "A friend asked me how the record was. I replied, 'my god, Fucked Up have made their 'Screamadelica''. And psych-rock-groove it is. The drums mixed wide, propensity for drones, for delay pedal, for repetition, groove. The politics and aesthetics of hardcore married to an 'open format' approach to genre. Elements of doo-wop, krautrock, groove, digital hardcore".

The band are set to play the Visions festival in London on 3 Aug. They've also released a video for the new album's first single, 'Raise Your Voice Joyce'.

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UK Music urges local councils to act as agent of change guidelines published
The boss of cross-sector trade body UK Music has written to the Chair of the Local Government Association about the good old 'agent of change' principle, which is now officially part of the UK government's National Planning Policy Framework for England.

After a long campaign by the likes of the Music Venue Trust, Musicians' Union and UK Music itself, the government announced earlier this year that agent of change would be added to its planning policy framework. This is the principle that puts the onus on property developers constructing new buildings next to existing music venues to ensure that there won't be issues around noise that cause said venues licensing problems down the line.

The campaigning to get agent of change adopted resulted in Labour MP John Spellar proposing specific legislation in Parliament back in January. Shortly after that the Ministry Of Housing, Communities & Local Government said it would add the principle into planning guidelines anyway, without any new laws being passed. Those updated guidelines came into effect yesterday.

The key paragraph in the updated framework document reads: "Planning policies and decisions should ensure that new development can be integrated effectively with existing businesses and community facilities (such as places of worship, pubs, music venues and sports clubs). Existing businesses and facilities should not have unreasonable restrictions placed on them as a result of development permitted after they were established".

It goes on: "Where the operation of an existing business or community facility could have a significant adverse effect on new development (including changes of use) in its vicinity, the applicant (or 'agent of change') should be required to provide suitable mitigation before the development has been completed".

In his letter to the Local Government Association, UK Music CEO Michael Dugher notes the organisation's support of Spellar's proposals earlier this year. He then asks it to promote the new guidelines among its members, so that agent of change can be quickly adopted and implemented by those actually making property planning decisions around England.

Commenting on the new guidelines as they came into effect, Dugher also told reporters: "The introduction of agent of change in the NPPF marks a pivotal moment in the fight to protect under threat music venues. The government is to be congratulated for taking this decisive step. Too often music venues have been the victims of developers. This new law will help ensure music venues can continue to grow audiences and develop talent, contributing significantly to our £1 billion live music industry. This has been a long fought battle and it is vital that local authorities back it to save live music. There is now no excuse for local authorities for not stepping in to protect grassroots music venues".

Meanwhile the aforementioned Spellar added: "I am delighted that the government has listened to concerns expressed by MPs and the music industry about the fate of music venues across the country, and has fulfilled its commitment to introduce the agent of change principle in the new National Planning Policy Framework by summer recess. This is great news for musicians and music lovers whose voice has been loud and has now been heard. Local authorities must now make use of these vital tools to support our world leading music creativity throughout our towns, cities and communities".

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Demi Lovato hospitalised by apparent drug overdose
A spokesperson for Demi Lovato has said that the singer is "awake and with her family" after being hospitalised yesterday seemingly as the result of a drug overdose.

According to local media, emergency services in LA were called to Lavato's home at 11.22am yesterday morning, with the singer being taken to Cedars-Sinai Medical Center. Various sources have said that a drug overdose was the cause of the emergency.

Responding to media reporting of the incident, a spokesperson said: "Demi is awake and with her family, who want to express thanks to everyone for the love, prayers and support. Some of the information being reported is incorrect and they respectfully ask for privacy and not speculation as her health and recovery is the most important thing right now".

Lovato has been very upfront over the years about her struggles with addiction and bipolar disorder. In March she revealed that she was celebrating six years of sobriety, but the lyrics of her recent single 'Sober' suggested that she had recently suffered a relapse.

If you are experiencing issues affecting your mental wellbeing you can access support and resources from both Music Minds Matter and Music Support. The Mind website also offers information and support on a range of mental health and addiction issues.

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Mark Lanegan and Duke Garwood release Scarlett Johansson-influenced new single
Mark Lanegan and Duke Garwood have released new song 'Scarlett'. The pair are set to release their second album together, 'With Animals', next month.

"Duke gave me a piece of music he called 'Scarlett' and I was inspired to put down the words really quickly, to the haunting beauty and feeling of the music", says Lanegan of the song. While Garwood adds: "'Scarlett' is a fever dream soundscape born from a banquet of Scarlett Johansson movies".

Of the album as a whole, Garwood goes on: "Over the years, we've recorded together and apart. This time, I started this record alone, with many animals as company. It flowed, I set to work and out it came". Of the duo's creative process, he continues, "our music is instinct, there is not much talking about it, just creating".

He then adds: "I think that if you are at peace with your work, and feeling it right, it flows, and can feel 'easy'. Music isn't meant to be hard. Though sometimes it can burn you to ashes. Making music for a singer, so they can inhabit it with a song, means hitting the right soul buttons. There is no hit without a miss. It is a healing record, for us the makers, and for the listeners. It grows natural. We are gardeners of sonic feelings".

The duo are also set to tour the UK in October this year. Here are the dates:

1 Oct: Gateshead, Sage
2 Oct: Bath, Komedia
3 Oct: Brighton, The Old Market
5 Oct: London, Union Chapel
6 Oct: Leeds, City Varieties
7 Oct: Glasgow, St Luke's
8 Oct: Manchester, RCNM

Watch the video for 'Scarlett' here.

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Henrik Schwarz announces Plunderphonia
K7!'s experimental label 7K! has announced a new project from Henrik Schwarz called 'Plunderphonia'. It will see the producer compose a new string piece using parts culled from existing works.

Schwarz chose the 70 works he now plans to adapt from over 700 possible pieces. His selections were then re-recorded by the Alma Quartet, ready for him to take the individual parts and rework them into his new composition. Among the composers he is plundering are Bach, Bartok, Brahms, Debussy, Dvorak, Ravel, Jonny Greenwood, Mozart, Schubert and Terry Riley.

Speaking about the project, Schwarz says: "I would hear hit records in the string quartet compositions. Suddenly you have four bars that are absolutely incredible, that are super modern even if they are 200 years old. By just extracting them and taking away everything else you put it into a new context and find ways of connecting different string quartets into something new".

'Plunderphonia' has been commissioned by the Berlin festival Pop-Kultur, at which Schwarz and the Alma Quartet will debut a work in progress version of the piece on 15 Aug. After that, they are scheduled to play the finished, album-length piece at the Elbphilharmonie concert hall in Hamburg on 23 Mar 2019. A recording will also be released the same day.

Here's a video to explain the project further.

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Nadine Coyle would reunite with her jealous former Girls Aloud bandmates, if you asked nicely
Bored of idle speculation about a possible Spice Girls reunion? Well, let's get going with some idle speculation about a Girls Aloud reunion then. Could that happen? There was, after all, some chatter earlier this year that they might reform for the eighteenth or 20th anniversary of their creation on that 'Pop Stars: The Rivals' telly show.

"It may happen", says one-time Girl Aloud Nadine Coyle, even though she's not aware of any active reunion plans at the moment. Speaking to the i newspaper she says that, whenever she is asked about her former group getting back together, "the answer is always the same: if everything comes together, then yes, I'm a huge supporter of Girls Aloud. I'd never say never to us coming back together".

But didn't Coyle once say that her bandmates were "jealous" of her because she got all the best singing bits? "I didn't say that", Coyle insists, "how pompous and arrogant would I have to be to say that?" I don't know. Quite pompous and arrogant I guess.

"But a thing that did cause stress in the band", she goes on, "was the fact that I was given more lines and the girls didn't like [producer] Brian [Higgins from pop makers Xenomania] as a result of it. They didn't like the label as a result of it, and they didn't like me as a result of it. So it was just circumstances which were out of my control: I didn't decide who sang what. But ... I love my life and I just get on with it".

How unpompously and unarrogantly put. But could those past tensions between band members – and, it was always assumed, between Coyle and Cheryl Tweedy in particular – stop this non-reunion were busy speculating about? Although she's not really in touch with her former bandmates anymore, Coyle insisted that "there's never been any issues with us working together ... so I'm sure we'd get on absolutely fine".

Good times. Now they just need to persuade Victoria Beckham to get on board. Oh no, sorry, wrong idly speculated reunion.

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