American Music Fairness Act

Summary#

This bill amends Title 17 of the U.S. Code to create a performance right for sound recordings when they are played by audio transmission. It removes the word "digital" from several places so the same rules apply to digital, analog, and other audio formats, and it defines "audio transmission" to mean a transmission of a sound recording (but not audiovisual works).

The bill adds terrestrial (over-the-air) broadcast transmissions into the existing statutory licensing framework for sound recordings. It directs the Copyright Royalty Judges to start proceedings as soon as practicable to set royalty rates for nonsubscription broadcast transmissions effective from the date of enactment through December 31, 2028, and to repeat such proceedings every five years.

The bill sets fixed, low annual fees for eligible small terrestrial broadcast stations: $10 per year for stations that had under $100,000 in revenue last year; $100 per year for public broadcasters with revenue between $100,000 and $1,500,000; and $500 per year for nonpublic stations with revenue between $100,000 and $1,500,000. Stations must meet revenue and ownership thresholds and provide a signed certification each year to the collective that distributes statutory licensing receipts.

It changes how royalties are divided when a copyright owner gives a direct license to an entity that otherwise would be eligible for the statutory license: 50 percent of the total royalties that entity must pay under that direct license for those transmissions must be paid to the collective that distributes statutory licensing receipts, and that collective must distribute those payments according to the existing distribution rules. The bill also states that nothing in it shall adversely affect the public performance rights or royalties of songwriters and musical-work copyright owners.

Finally, the bill tells the Copyright Royalty Judges to consider economic, competitive, and programming information when setting rates, including whether a station's use of recordings substitutes for or promotes sales of recordings or affects other revenue streams of the sound recording copyright owner.

What it means for you#

• If you own or run a terrestrial radio station: the station would be covered by the new performance right and statutory licensing rules. Small stations that meet the bill's revenue and ownership tests may pay one of the fixed annual fees ($10, $100, or $500) instead of rates set in a royalty proceeding, but must certify eligibility each year.
• If you are a performer or owner of sound recordings: the bill creates a statutory performance right for audio transmissions and changes how some royalties are collected and distributed. A direct license that covers transmissions otherwise licensable under the statutory license must send 50% of the applicable payments to the statutory collective for distribution.
• If you are a songwriter or owner of a musical work (the composition): the bill states it will not adversely affect public performance rights or royalties for songwriters and musical-work owners.
• If you are a listener: this bill changes how stations and recording owners handle payments for playing recorded music, but it does not state changes to listener access.

Expenses#

• The bill sets specific, annual statutory fees for eligible small terrestrial broadcast stations: $10, $100, or $500, depending on station type and prior-year revenue. It specifies how revenue and owner aggregate revenue are calculated and requires annual certification.
• Royalty rates and terms for other nonsubscription broadcast transmissions will be determined by the Copyright Royalty Judges in proceedings the bill requires; the bill does not set those rates.
• No publicly available information on total fiscal impact, overall industry payments, or federal budget effects is provided in the bill text.

Proponents' View#

The bill is described as intended "to provide fair treatment of radio stations and artists for the use of sound recordings." Proponents, based on the bill text, would view these changes as extending a performance right to terrestrial broadcasts, setting rules for rate-setting, and protecting small broadcasters with fixed low fees while clarifying royalty distribution rules.

Opponents' View#

No publicly available information.