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Prior to the 1909 Copyright Act, Congress granted musical works copyright holders the right to control the public performance of their works. The 1909 Act further recognized a public performance right but limited the right only to performances engaged in for profit. Not until 1976 was the for-profit limitation removed.
Despite possessing the right to control public performance, musical work copyright holders had difficulty in collecting licensing fees for performances. This problem was alleviated by the creation of performing rights organizations (PROs). In 1914, a group of nine music business leaders established the American Society of Composers, Authors, and Publishers (ASCAP). ASCAP licenses thousands of musical compositions for public performances under blanket license agreements. For business owners, these blanket licenses significantly reduce the transaction costs involved in complying with the requirements of the Copyright Act. For musical work copyright holders, these licenses allow receipt of a share of the royalties that were previously not of much value.
Due to ASCAP’s attempt to raise the royalty rates charged to radio stations, Broadcast Music, Inc. (BMI), became a new PRO in 1939. The Society of European Stage Authors and Composers (SESAC), another PRO, was formed in 1930. Each PRO can only license public performances of musical works under contract with that PRO.
Current law Edit
Copyright holders may use a license to grant third parties legal permission to use musical works and sound recordings. A license provides legal permission for the use of copyrighted material by a group or an individual other than the copyright holder. Permission for the use of the material typically requires the payment of a royalty and compliance with other conditions of the license. As shown in Table 2, third parties, such as AM and FM broadcast radio, satellite radio, and Internet radio, must obtain a license for the public performance of a copyrighted musical work. However, under current law, copyright protection does not apply to the performance of sound recordings played over broadcast radio and therefore a license is not required.
The Digital Performance Right in Sound Recordings Act of 1995 created for the first time an exclusive public performance right for copyright owners of sound recordings, limited to certain performances made by then existing satellite and cable digital subscription services, and it exempted performances made by broadcasters over the air. Three years later, the Digital Millennium Copyright Act (1998) expanded the protection to reach performances offered by webcasters and new subscription services, and it retained the exemption for terrestrial broadcasters.
- ↑ Act of Jan. 6, 1897, ch. 4, 29 Stat. 481-82, amended by Act of Mar. 4, 1909, ch. 320, § 25, 35 Stat. 1081.
- ↑ Act of Mar. 4, 1909, ch. 320, § 1(e), 35 Stat. 1075.