PONDERING PATENTS: FIRST PRINCIPLES AND FRESH POSSIBILITIES

The Shifting Landscape of Music Licensing
Lydia Pallas Loren

Music is an integral part of culture in the United States.  Not only do individuals enjoy both listening to and performing music created by others, increasingly individuals use music created by others to express themselves, their moods, and their emotions.  Whether by selecting cellphone ringtones to identify their own personality or by creating playlists to share with friends, individuals use music created by others to communicate about themselves and their relationships. 
Much has changed in the music industry over the past two decades.  While combatting the meteoric rise of the peer-to-peer filing sharing networks, a multitude of music industry players fought vigorously to capture revenue streams as new business models emerged, offering consumers multiple new ways to experience and use music.  As a result, the fragmented copyright rights that characterize the music industry have taken on new layers of complexity including, for example, in the market for authorized digital downloads, cell phone ringtones, and interactive internet-based music services.  While some of this new complexity stems from the two acts adopted by Congress, a more significant source of the regulatory complexity arises from: (1) new lengthy administrative rules issued by the Copyright Office relating to a variety of aspects of the music industry, (2) model licensing agreements established by private actors and then sanctioned by the Copyright Office, and (3) court rulings concerning impermissible private licensing arrangements under the antitrust decrees that govern the two major private performing rights societies, ASCAP and BMI.  This article seeks to explore the consequences of these different regulatory approaches in the music industry, offering insights into the costs and benefits of each approach while describing the shifting landscape of music licensing.