Proposed US bill would allow indie artists to negotiate collectively with streaming services, AI companies

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A bill introduced in the US Congress would give independent music creator-owners the ability to negotiate collectively over payments from streaming services, and over the use of their works by AI algorithms.

The Protect Working Musicians Act of 2023, introduced on Tuesday (September 19) by House Rep. Deborah Ross, a North Carolina Democrat, updates an earlier bill introduced in 2021 by Rep. Ted Deutch, a Florida Democrat. That bill focused on the relationship between indie artists and music streaming services; the new bill also includes AI companies.

The updated bill, which has gained the endorsement of the American Association of Independent Music (A2IM) and the Artist Rights Alliance (ARA), “will help give small, independent music creators a level playing field, empowering them to stand together for fairer compensation and giving them a voice in important negotiations that will determine the future of the music industry,” Rep. Ross said in a statement.

“Working musicians and small independent labels face urgent challenges to their livelihoods posed by the market power of streaming platforms as well as the explosion of AI applications that use their work without licensing or pay.”

Indie artists typically get their music onto digital services platforms (DSPs) like Spotify via music distributors like TuneCore or DistroKid, which negotiate licensing deals with the DSPs, or rely on agreements negotiated by digital rights music licensing network Merlin.

On user-generated content platforms like YouTube, indie artists can generally upload their own content, but must abide by the platform’s terms and conditions. Typically, these platforms have a lot of leeway in terms of how much they pay to artists, and under what conditions.

The bill, which can be read in full here, would create an exemption to US antitrust laws that would allow music creators to come together to jointly negotiate licensing deals with a “dominant online music distribution platform or a company engaged in development or deployment of generative artificial intelligence.”

The bill defines a “dominant online music distribution platform” as any entity that “operates an app, website or other online service that is used by members of the public to listen to sound recordings, whether via a digital audio transmission, an audio-visual presentation, or any other means,” and has annual revenues of USD $100 million or more from activities related to music distribution.

In an interview with Billboard, Ross said the bill would enable independent artists to behave like plaintiffs in a class-action lawsuit, “fighting for their rights” with the aid of a single attorney.

Ross said she wasn’t sure of the bill’s chances of passing through a divided Congress.

“As you can see in Congress, lots of bills aren’t passing — like the budget! But this has been a very bipartisan issue in the judiciary committee. It’s the perfect time to bring these issues up.”

The bill comes at a time when major recording companies are negotiating with streaming services for better payment models.

The new model will see “professional artists” – defined as those who have a minimum of 1,000 streams per month and a minimum of 500 unique listeners – receive a so-called “double boost” to royalty payments.

In other words, when calculating their royalty payments, streams of their music will carry double the weight versus streams of ‘non-professional’ artists.

Among the major recording companies, UMG has been particularly vocal about the problems posed by generative AI, and its potential to undermine artists by appropriating their likeness or musical style, as in the case of the “fake Drake” track that went viral earlier this year.

Though that track mimicked the vocals of Drake and The Weeknd – two UMG-signed artists – the issue of AI is also of concern to independent music creator-owners, who don’t have the resources that larger rights-holders have to take on AI-generated content that violates their rights.

“Working musicians and small independent labels face urgent challenges to their livelihoods posed by the market power of streaming platforms as well as the explosion of AI applications that use their work without licensing or pay.”

US House Rep. Deborah Ross

“Musicians today are fighting for fair treatment on so many fronts, including both in the online streaming marketplace and against the growing threat posed by AI companies who exploit creators’ work without permission,” Artists Rights Alliance Executive Director Jen Jacobsen said in a statement.

“The ‘Protect Working Musicians Act’ will give small and independent artists a shot at facing these challenges by allowing them to negotiate collectively with the large and powerful entities who profit from musicians’ hard work.”

Singer-songwriter Tift Merritt, Co-Chair of the Artist Rights Alliance, said: “Artists, songwriters, and independent labels have never needed each other more, and this legislation will ensure our voices are heard and we receive fair pay for our work.”

“The Protect Working Musicians Act is a necessary tool for independent artists and labels to compete in today’s marketplace and receive fair compensation for their work from streaming platforms and AI companies,” John McCrea, Co-Founder of the ARA and a founding member of the band Cake, added.

“It is amazing that it even needs to be said, but people who make things have a fundamental right to negotiate with the giants who use and distribute their work.”Music Business Worldwide

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