Is The MLC Part of Your Overall Licensing Strategy?

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.

Location:

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.

 

 

 


Moj owner ShareChat raises $502m at a valuation of $2.1bn - Music Ally

After signing up 50 million Moj users in its first month, ShareChat raised a $40m funding round; struck some music licensing deals; and tapped Audible Magic for copyright-detection technology, while also fielding rumours that western tech firms Google and Snap wanted to invest in the company.

Read the full article by Music Ally here.


Are EU Member States Making Progress with Article 17?

With the June 7th, 2021 deadline looming for EU Member States to implement the 2019 EU Copyright Directive, many wonder about the timing of individual country transpositions or if there will be delays. The transposition is a process whereby each member state passes legislation to give force to the directive in that country. Although Covid-19 slowed progress, all major EU countries are making headway in their transposition process and are expected to meet the June deadline.  The one significant exception is the UK, no longer part of the EU because of Brexit. The government has said it will not be implementing the directive.

To ensure the benefit of the new safe harbor provisions, online content-sharing services that make copyright works, such as music, publicly available in user-generated content will need to understand how and when the law is transposed by each member state. For example, The Netherlands has completed the transposition of the law and has specified that it will go into effect as of June 7, 2021.

We are watching this process carefully since some countries have considered adopting additional or different implementation measures in their transpositions. This could cause service providers to have a requirement to adjust their plans for each country they stream content to.

To learn more about how Article 17 will impact your business, we have included more resources at the end of this summary.

 

The Netherlands

The Netherlands became the first EU member state to implement the directive on December 28th. Their implementation is mostly a literal transposition of the directive’s provisions, but it also includes a provision that allows the Ministry of Justice to provide further rules on the application of the Article 17 implementation.

 

Germany

On February 3rd, Germany’s government approved their latest proposal, which was revised in response to feedback from rightsholders and platforms. This draft states that without a corresponding license, platforms must block uploaded copyrighted content; however, short excerpts are presumed permitted by law and may not be blocked by automatic means. The law is scheduled to be debated in the legislature in March.

 

Austria

The Austrian Ministry of Justice completed the first proposal in December, which borrows elements from previous German proposals, including a direct remuneration right for creators, users’ ability to pre-flag uploads as legitimate, and a threshold that protects minor uses from automated blocking.

 

France

France passed an authorization law on November 18th, allowing them to implement provisions of the directive by administrative decree. This law specified that the decree implementing Article 17 must be issued 6 months from its passing, which would be April 18th. France's draft law proposes a literal adaptation of Article 17.

 

Finland

Finland’s proposal relies on the mandatory use of ACR (Automated Content Recognition) technology by platforms. Rightsholders would be required to review infringing uploads before issuing a blocking request, and users would be able to challenge blocks through an independent alternative dispute resolution mechanism.

 

Denmark

Denmark announced that it would implement Articles 15 and 17 during the parliamentary year and the rest of the directive after the summer. Like the Netherlands, the Denmark transposition is a literal adaptation of the EU Copyright Directive.

 

The UK Copyright and Creative Economy Centre, based at the University of Glasgow, maintains possibly the most comprehensive and up-to-date resource on national implementation at https://www.create.ac.uk/cdsm-implementation-resource-page/.

 

Check back for more updates on Article 17 in the coming months. The following resources will help you understand how Article 17 may impact your business.   

 

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.

 

All information is accurate as of March 8, 2021

 

Sources

https://www.twobirds.com/en/in-focus/copyright-directive 

http://www.xinhuanet.com/english/2021-02/04/c_139719400.htm 

https://www.communia-association.org/2021/01/07/dsm-directive-implementation-update-more-proposals-to-protect-users-rights/ 

https://www.communia-association.org/2020/12/07/dsm-directive-implementation-update-six-months-go-no-end-sight/ 

http://copyrightblog.kluweriplaw.com/2021/01/21/divergence-instead-of-guidance-the-article-17-implementation-discussion-in-2020-part-1/   


Takwene Protects Artists’ Rights and Manages Their Catalog with Audible Magic’s RightsRx™ Plus

The award-winning MCN and distributor supports

creators from production to rights protection.

 

The company's name, Takwene, the Arabic word for create, reflects its commitment to providing comprehensive support for artists, often musicians, to produce and succeed online. The Middle Eastern focused multi-channel network (MCN) and distributor launched in 2011 just as the Arab Spring began.  Undaunted by the crisis, the Takwene development team focused on building their music distribution platform. The investment paid off as they became the first and only YouTube Certified Partner in the region shortly thereafter 

Continued growth drives the search for Automated Content Recognition Solutions 

In 2015Takwene began registering their audio and video with Audible Magic to protect against unauthorized use on UGC hosting platforms.  In 2019, Takwene became the biggest music library in the Middle East, hosting over 100,000 audio and video assets, including Bedouin and Libyan music. The company was also hosting a wide variety of content from creators in the United States and the European Union. 

The growing company needed a solution to prevent uploads of unauthorized copyrighted material to their digital service providers (DSP) and to proactively manage ownership conflicts in their international catalog 

Accuracyscalability, and an international registry were key 

Because of the variety of music and the scope of their growing catalog, Takwene needed an automatic content recognition (ACR) vendor that had an extensive international music registry combined with a highly accurate and scalable service to minimize costly human intervention. Although they looked at several ACR providers, Audible Magic’s RightsRx Plus service provided the best match for their requirements. 

Prevent the upload of unauthorized copyrighted content and identify catalog conflicts with RightsRx Plus 

RightsRx Plus compares a submitted track against an extensive music registry and responds with applicable ownership information to help maintain a catalog free of unauthorized copyrighted content and conflicts.  This quick scan helps distributors maintain their status with DSPs and resolve ownership issues with other rightsholders. 

“We needed a service that would minimize human intervention, which can be costly. The solution had to be highly accurate and scalable for our expanding business, and accommodate the metadata complications when encoding a diverse catalog merging folkloric Bedouin, Oriental & Nubian Music.” said Ayman Konna, CEO of Takwene. Audible Magic easily fit the requirements, and the team appreciated the quick integration. We were scanning tracks within a day.” 

Challenge: Prevent copyrighted material from being uploaded to DSPs as well as manage conflicts in their catalog. Handle RTL and different metadata encoding. 

Solution: Audible Magic’s RightsRx Plus  

Key Requirements:  Extensive international registry, minimal manual intervention, scalability, accuracy. 


Audible Magic Surpasses 100 Million Tracks

Audible Magic the First to Surpass 100 Million Music Tracks

Comprehensive rights-managed music catalog supports streaming, download, fitness, UGC, and other branded services

Los Gatos, Calif. – Feb. 23, 2021 – Audible Magic announced their rights-managed catalog has surpassed 100 million tracks, a first in the space. This milestone gives Audible Magic the largest business-to-business rights-managed catalog available.

The impressive catalog, which contains tracks from over 400,000 labels, is part of the long-established MediaNet content fulfillment and rights administration business purchased by Audible Magic in January 2021. Audible Magic is now the leading provider of content identification, licensing, media fulfillment, and rights administration services to digital music and social media platforms.

The catalog is a result of close relationships with record labels and publishers built over 20+ years of successfully launching music services around the world. It also required the development of a sophisticated rights management platform to take account of the constant changes in rights ownership, and the accelerating numbers of new tracks being released. In 2020 alone, Audible Magic saw a 67% increase in new releases added to their catalog, ingesting, on average, 12,000 new albums every day. This is a massive undertaking and is unmatched in the industry.

Coupled with a 100M tracks catalog, digital platforms can access a variety of Audible Magic’s turnkey music licensing solutions for a variety of services including fitness applications, short-form video, streaming, and downloads. Additionally, Audible Magic’s flexible solutions enable platforms to leverage their own licenses as well as Audible Magic’s pass-through licenses when applicable.

“We are excited to offer an exhaustive music catalog that provides tracks from major and indie labels across an array of territories throughout the globe,” said Vance Ikezoye, chief executive officer of Audible Magic. “Coupled with our services, our customers can focus on creating incredible user experiences, while we take care of the arduous task of rights administration and royalty payments.”

 

About Audible Magic

For more than 20 years, Audible Magic has innovated solutions to identify content, provide fulfillment solutions, manage rights, and monetize media. Audible Magic’s Emmy-winning automatic content recognition (ACR) technology powers billions of monthly transactions. The Silicon Valley pioneer is the trusted intermediary between major platforms and rightsholders (including labels, studios, distributors, publishers, and collectives). The company works with a wide range of platforms and rights holders, including Facebook, Twitch, SoundCloud, Dailymotion, ShareChat, Vimeo, NBC Universal, Universal Music Group, Sony Music Group, Warner Music Group, The Orchard, CDBaby, and DistroKid. For more information, visit https://www.audiblemagic.com/.


Audible Magic Acquires SOCAN's MediaNet - Hypebot

Canadian PRO SOCAN has sold its global content fulfillment and rights administration service MediaNet to Audible Magic.

Read the full article by Hypebot here.


Audible Magic acquires rights administration business MediaNet from SOCAN - RightsTech

SOCAN and Audible Magic have also announced they have entered into a strategic partnership with the goal to use Audible Magic technology and services to help SOCAN improve operational accuracy and reporting to publishers and songwriters. Financial terms of the deal were not disclosed.

Read the full article by RightsTech here.


Audible Magic Acquires Rights Administration Business MediaNet from SOCAN - Music Business Worldwide

Digital content identification, licensing, and monetization platform Audible Magic is acquiring content fulfillment and rights administration business MediaNet from Canadian performing rights organization, SOCAN.

SOCAN and Audible Magic have also announced they have entered into a strategic partnership with the goal to use Audible Magic technology and services to help SOCAN improve operational accuracy and reporting to publishers and songwriters.

Read the full article by Music Business Worldwide here.


Frequently Asked Questions regarding Audible Magic’s Acquisition of MediaNet’s Business

On Monday, January 11th, 2021, Audible Magic and SOCAN announced that the companies had entered into an agreement to transfer SOCAN’s content fulfillment and rights administration business to Audible Magic.

Understandably, many content partners and customers of both MediaNet and Audible Magic have questions about what this means to their day-to-day interactions and services they may have been receiving from each company. We hope that the information below will provide some guidance, but always, feel free to reach out to us for further information. Both teams remain fully committed to our content partners and customers.

When does this acquisition go into effect?

The acquisition will be effective as of January 6, 2021.

Why is Audible Magic making this acquisition?

This acquisition enables Audible Magic to offer a unique one-stop-shop solution for digital service providers and UGC hosting platforms looking to manage copyrighted content. Audible Magic will be able to offer licensing, rights management, and royalty administration as well as industry-leading content identification services.

What are the benefits to Audible Magic customers?

Current Audible Magic customers will now have access to a full suite of content management services including licensing, rights management, royalty administration, and media fulfillment.

What are the benefits to MediaNet customers?

MediaNet customers will gain access to the gold standard in content identification services so important for accurate attribution of copyright, licensing, rights administration, and reporting.

Will there be any changes to the services provided to MediaNet or Audible Magic customers?

Both Audible Magic and the MediaNet teams remain committed to all existing customers with the same level of support.

Are there changes to my contacts at MediaNet or Audible Magic for business or technical issues?

We do not intend to change your primary business contacts currently. If you do have any questions, please contact us at [email protected]

Will there be changes in how content partners should deliver content feeds?

There will be no immediate changes in how a content partner sends feeds to either Audible Magic or MediaNet. However, we will be looking into options to make the process easier for our content partners moving forward.

Will there be any changes to the processing of royalty payments or accounting reports?

The processes currently in place will continue as before the acquisition. As the two companies merge, we will be looking for opportunities to provide improved processes to benefit our content partners and customers. If you have any questions, please contact us at [email protected]

Are there changes planned to MediaNet customer billing and invoicing for services?

Yes, invoices will be issued with an Audible Magic logo starting in January. You will have access to your invoices and statements via an online portal. You will receive a link via email to set up your account within the portal, as well as a user guide for questions and assistance. Remittances should be made per the instructions on the invoice.


Audible Magic Acquires MediaNet’s Business from SOCAN, Integrating UGC & Premium Music Solutions

 Audible Magic to offer “one-stop-shop” for music licensing and copyright compliance 

 Los Gatos, Calif. – Jan. 11, 2021 – Audible Magic and SOCAN announced the companies have entered into an agreement to transfer SOCAN’s content fulfillment and rights administration business of MediaNet to Audible Magic. Audible Magic is the leading provider of identification and compliance solutions to social networks hosting user-generated content (UGC). SOCAN is the Canadian performing rights organization. MediaNet has a long history of delivering turnkey white label digital music solutions for Internet radio, subscription music services, on-demand streaming, and support for fitness and gaming applications. With this acquisition, Audible Magic can now provide digital platforms a comprehensive range of services to enable and manage the use of music.

Audible Magic provides solutions for music licensing, content identification, and rights management to social media platforms. This acquisition extends its capabilities to deliver bespoke licensing from hundreds of labels and publishers, media files for more than 92 million tracks, full rights management, and royalty and payment administration. This portfolio of services will enable social platforms to more easily exploit the opportunity for both music in UGC and premium content. According to a recent MIDiA Research report, The Rising Power of UGC, there is a projected $6 billion opportunity in the appropriate use of audio and video for streaming of music in UGC alone.

“Rightsholders and platforms will both benefit from our combined solution and will reduce the time and complexity of managing and paying for the use of music,” said Vance Ikezoye, Audible Magic chief executive officer. “We see significant upside in enabling incremental revenues for the music ecosystem.”

SOCAN and Audible Magic also announced they have entered into a strategic partnership with the goal to use Audible Magic technology and services to help SOCAN improve operational accuracy and reporting to publishers and songwriters.

“The acquisition of the MediaNet services by Audible Magic creates long-term benefits for SOCAN’s members and clients,” said Jennifer Brown, Interim CEO of SOCAN. “Audible Magic is a knowledgeable and skilled company and we’re looking forward to working together to improve the accuracy of reporting to publishers and songwriters.”

SOCAN acquired Seattle-based MediaNet in 2016. By legal agreement, terms of Audible Magic's acquisition are confidential.

 

About Audible Magic  

For more than 20 years, Audible Magic has innovated solutions to identify content, manage rights, and monetize media. Audible Magic’s Emmy-winning automatic content recognition (ACR) technology powers billions of monthly transactions. The Silicon Valley pioneer is the trusted intermediary between major platforms and rightsholders (including labels, studios, distributors, publishers, and collectives). The company works with a wide range of platforms and rights holders, including Facebook, Twitch, SoundCloud, Dailymotion, ShareChat, Vimeo, NBC Universal, Universal Music Group, Sony Music Group, Warner Music Group, The Orchard, CDBaby, and Distrokid.  For more information, visit https://www.audiblemagic.com/. 

About SOCAN

SOCAN is a rights management organization that connects more than four-million music creators worldwide and more than a quarter-million businesses and individuals in Canada. More than 160,000 songwriters, composers, music publishers, and visual artists are its direct members, and more than 100,000 organizations are Licensed To Play music across Canada. With a concerted use of progressive technology and unique data as well as a commitment to lead the global transformation of rights management, SOCAN is dedicated to upholding the fundamental truths that music and visual arts have value and creators and publishers deserve fair compensation for their work. For more information: www.socan.com.

Contact:

Adriana Saldaña

Sterling Communications for Audible Magic

[email protected]

+1 408-395-5500