If Radio Can Pay Royalties, Movie Theaters Can Pay Too!

By • October 19, 2009

There’s been a lot of news recently about legal efforts underway in the U.S. Senate and House to create a law that eliminates the legal loophole that allows terrestrial radio stations to avoid paying royalties to artists and labels. If an effort like this can make it onto the congressional agenda, it’s time to close one of the biggest royalty loopholes that affects composers today – the inability of ASCAP, BMI and SESAC to collect performance royalties for composers, songwriters and publishers on massively profitable public performances of music in films shown in movie theaters in the U.S. The silence from ASCAP and the other PROs on this issue is deafening, and perhaps we should consider why those we pay to negotiate and collect our royalties through performance license fees seem to be afraid to take on one of the most profitable public performances of music in America.

Before the 1940s, ASCAP actually collected license fees from movie theaters in the form of a “seat tax”, but according to the book “Pennies from Heaven” by Russell and David Sanjek, tried to triple the seat tax on movie theaters in the 1940s. The movie theaters, most owned by movie companies at the time, predictably fought back and argued that they shouldn’t have to pay a performance royalty to composers they had already paid to score their films. The theaters were victorious in court, and the result of ASCAP’s money grab was a financially disastrous legal loophole allowing “free music” to the movie theaters in the U.S., completely out of step with most other developed countries where movie theaters must pay performance license fees like any other broadcaster that publicly performs music.

Most recently in 2000, ASCAP, in their “Amended Final Judgment 2” deal with the U.S. Department of Justice (the deal that allowed ASCAP to virtually eliminate the independent board candidate process by increasing the number of required petition signatures from 25 to over 1,330 among other draconian actions) agreed to not collect performance license fees from movie theaters (other than the music playing in the lobby) – in fact, it was the first item in the agreement.

We all must ask ASCAP and the other PROs: what could possibly be the justification for agreement to this outrageous prohibition on performance royalties, especially since the basis it was argued for (movie theaters owned by movie companies) no longer exists?

Why aren’t ASCAP’s highly-paid lobbying folks in Washington working on this issue?

In fact, I haven’t heard word one about the issue of movie theater royalties from anybody at ASCAP, BMI or SESAC in years, despite the massive losses to composers and songwriters. Why the performing rights organizations seem to be content to leave potentially millions of dollars of royalties on the table is a question composers need an answer to.

In this era, composers simply cannot afford to let such a massive “free music” legal precedent stand – if other entities that produce content and publicly perform it, like FOX, are able to successfully take advantage of this now-established legal precedent, the losses to composers and songwriters could escalate massively.


By Brian on October 22nd, 2009 at 7:53 pm

Dream on, Mark.

By Tim McLane on November 15th, 2009 at 4:10 am

Dear Mark,

Thanks for your efforts in educating composers, publishers and members of the public, as well.

What does ASCAP say about this when you ask them? They must have some kind of position statement on the issue.

There are so many facets of the solution to this issue and improving the public’s awareness of need of education is just one. The go-it-alone, take-care-of #1″ attitude on the part of the public which includes a devaluing of education in the arts, music and the great ideas of the past is another one. This is a problem which affects the whole world — not just us here in Hollywood and it requires a change of attitude. I know that we like to “fix” things with a pill, a check or some new legislation but it won’t work here. It’s like being fat: it didn’t happen overnight. It’s going to take articulate, dedicated leadership, such as people like you, who will take the time, study the problem and then dedicate the rest of their lives to educating the public.

For us, the composers, I think one solution is in more international organization. There are many success stories of individuals, minorities and even countries that have benefited by using the world stage to publicize their problems, by addressing the problem on an international level, by getting a better deal in another country, by selling their products at an international level, etc. No matter what we may think of the complications of thinking and acting globally, remember that it’s being done everyday by distributors and corporations who might not want to pay here but will pay in another country. I have seen music publishing companies get more out of a small, provincial, abusive country in the long run by giving an artist from that country a deal in the US, Canada or Europe —and then publicizing it. This publicity shames them in front of the world and they then change their ways because they don’t want to lose face —again. It came to light a few years ago that a major factor in the success of the Brown vs. The Board of Education decision by the US Supreme court in 1955 was that the US government decided to support desegregation because it had to respond to the argument that perhaps communism was a better way of life because at least it offered equality— and we obviously didn’t. This shows that in spite of claiming otherwise, what the rest of the planet thinks is critical to us here in the US.

Never-the-less, I haven’t figured out yet specifically what we as composers could do, i.e., how we could take action. Wouldn’t it be great if we could join some kind of performance organization, i.e., from another country, which could collect for us the way we want? Wouldn’t that be great? Don’t dismiss this as an idealist notion: When publishing companies started signing artists in other countries and then getting them deals with ASCAP or BMI, it didn’t threaten anyone. However, I have seen at least one major composer in the US get tired of hearing excuses from our performance orgs for collections that were sloppy, one-sided, and unfair and so they moved their whole catalog to another performance org. They even got an advance doing so!

The movies and the music are the last thing that America has to offer that the world is still crazy about; only we are to blame if we don’t take advantage of this and begin thinking and acting more globally.

Best wishes,

Tim McLane

By Tony Lavorgna on February 28th, 2014 at 3:28 pm

Are you serious?
My song Inspiration is in the new movie The David Dance.
You mean if 10,000,000 people in the US see this movie in public theatres I don’t get a dime in Royalties?
This is hard to believe. This is very unfair. Don’t the composers of the songs in the movies care about these things?

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