It's accurate, but not entirely helpful, when thinking about the business of music to imagine in your mind a tangled knot about the size of an elephant. The free ends, rope made up of different gauges and materials, trail out from its center, resembling an asterisk. Holding each is a representative from one of the industry's many stakeholders — record labels and publishing companies, legislators and record store owners, tech companies and non-profit advocates. Oh, and artists too. With uneven strength, they all pull at all times, a never-ending game of tug of war with each other and with the knot, which grows ever tighter. Its circuity is, for some involved, not a bug but a feature — what's called informational asymmetry. To others this density keeps them from a comprehensive understanding of their own business. If the knot were untied, many would benefit. Some others wouldn't.
Recently, Republican congressman Jim Sensenbrenner of Wisconsin picked up an unattended end of this squiggle, unveiling his "Transparency in Music Licensing and Ownership Act." Rep. Sensenbrenner's new bill is ambitious.
Sensenbrenner, who sits on the House Judiciary Committee — through which he has conducted (by his own account) 20 hearings on copyright reform — is calling for the establishment of a comprehensive database of compositions and recordings and those works' owners and identification numbers. It's a project that has been attempted at least once before, and which failed spectacularly due to the competing interests involved in its creation, as well as its significant cost, which no one has been inclined to shoulder. What's more, this database will be free and public.
The lack of a central repository for this information has resulted in many legal and public-relations confrontations over the years, most recently two lawsuits against Spotify that accuse it of failing to properly license the rights for and of failing to create a system that could intake those rights were it notified of them. (The company settled one class action suit over the same issue recently.) That word "central" is important — this information is out there, but diffused among its owners, some of whom consider this data a trade secret. Rep. Sensenbrenner's bill would create the database Spotify failed to, at no cost to it.
The bill, which we'll call the Music Transparency Act, was ostensibly written to help businesses like bars and restaurants have clarity on what they are allowed to play, by giving them a place to see which company controls which artist's work. However, the availability of this information is not the same thing as the availability to license this music. To do that — and so to legally play music in certain establishments — a license from a performance rights organization is required. The two leading performance rights organizations in the world are ASCAP and BMI, who jointly control the performance rights of some 90 percent of recorded music.