The Mechanical Licensing Collective (MLC) continues to make strides in building its new team and has already begun to receive payments from digital service providers (DSPs). It is great to see the progress in a much-needed organization that will help simplify license administration for rightsholders and DSPs in the United States.

Some may be unclear about the scope of The MLC in the complete context of all of the rights required to distribute music. All entities that use music, whether on streaming sites, social networks, workout platforms, or yes, even permanent download stores, need to understand if The MLC fits into their overall licensing strategy or not.


What is The MLC?

The MLC is an organization born out of the Music Modernization Act of 2018 (MMA). The MMA updated how mechanical rights in musical compositions are licensed for music streaming and download services. Previously, under Section 115 of the U.S. Copyright Act, DSPs downloading or streaming music could use a compulsory license to license the mechanical rights in musical compositions made available through their services. Using this type of license, a music user would be required to license each musical composition on a share-by-share basis and to provide notice reporting and payments to publishers, administrators, and self-administered songwriters, composers, and lyricists. With the massive volume of music these platforms host, the process was challenging to say the least.

Under the MMA, qualifying DSPs in the United States can elect to secure a blanket mechanical license for music for streaming and downloads. The MLC was created to administer this license, and all DSPs which obtain the license send a monthly report and payment to The MLC. The MLC will then disburse payments and reporting to the publishers who have registered on The MLC portal.

The establishment of The MLC will provide greater clarity, licensing certainty, regular reporting, and accountability, all of which will help both the music industry and the platforms.


The MLC is Only Part of the Overall Licensing Solution

The responsibilities of The MLC are laid out in Section 115 of the U.S. Copyright Act and were designed to meet a specific need for administering rights for music audio between publishers and DSPs for downloads and streaming. Considering what The MLC does not cover brings to light what additional steps a digital platform may need to take to be fully licensed.

Record Label Deals:

The MLC administers a blanket license for the mechanical rights in musical compositions required for a service to offer downloads and streaming music. Platforms will still need to license, report, and pay royalties to the record labels for the use of the sound recordings in which these musical compositions are embodied.


The blanket license administered by The MLC is only available for services made available in the U.S. If a DSP is downloading or streaming music outside the United States, it will need to ensure it has licenses to use the music (both the sound recordings and the musical compositions) in those territories.

Types of Licenses:

The MLC does not administer any other types of licenses or royalties besides the blanket mechanical license for streaming and downloads, and voluntary licenses for the same covered activities. Licenses The MLC does not administer include:

  • Public performance licenses
  • Synchronization licenses (audio tied to video)
  • Sound recording licenses
  • Licenses for physical products such as CDs

Licensing Examples – What is covered, what is not:

Let’s look at a couple of fictional music hosting platforms and what they should be thinking about in their licensing strategies. You should consult with an experienced music licensing professional such as a music lawyer or advisor when developing your own licensing strategies.

A medium-sized social network hosting user-generated videos with music in the US and the European Union: The blanket mechanical license from The MLC is designed to address platforms downloading and streaming music.  This type of license covers audio, but not audiovisual. Thus, it does not address any music use occurring in a user-generated video. The DSP would have to have direct licenses with the label and the publisher.  In addition, the social network is doing business outside the United States and will have to consider how they will license music in multiple territories with both publishers, music rights organizations, and labels.

A medium-sized music streaming service providing interactive music streaming in the United States: Such a service would be eligible for a blanket mechanical license under Section 115 of the U.S. Copyright Act. The MLC would administer the license, and the DSP would report and send royalties to The MLC. The DSP would also need to obtain a license from, and report and pay royalties to the performing rights organizations for the public performance rights in the musical compositions and the record labels for rights in the sound recordings.

Although The MLC’s scope is not all-encompassing, it does cover one of the more common ways recorded music is made available in the United States today and is a step in the right direction in managing the challenges of music license administration. However, for those hoping to host music on their platform, whether for streaming, downloads, fitness apps, gaming, or UGC, companies need to have a complete licensing strategy in place.


The team at Audible Magic will continue to monitor The MLC’s activities and hope to provide more information in the future. In the meantime, check out the resources below.


Audible Magic – Powering Music Online

Leveraging our fully rights-managed catalog of over 100 million tracks, Audible Magic enables platforms to use music via our comprehensive licensing, fulfillment, identification, and rights administration services. Our bespoke scalable solutions enable the use of music in a myriad of use cases including UGC, downloads, streaming, and radio.

This blog is issued for informational purposes only and is not intended to be construed or used as general legal advice. Please contact the author(s) or your Audible Magic Corporation contact if you have questions regarding the currency of this information.