Music Industry Pushing for New Fees Through Legislation

The music industry looking for ways to generate new revenue from downloaded content, and it has turned to Congress in hopes of passing legislation that would force companies like Apple and Amazon to pay additional royalty fees. If passed, media download services would have to pay royalty fees for the songs played in movies and TV shows, and for the 30 second track samples users listen to before buying a song, according to CNET.

The music industry claims that songwriters and composers aren't getting paid royalties for their works if they are included in downloaded versions of movies or TV shows. They are also claiming that the 30 second song samples consumers listen to at the iTunes Store and other online music services constitutes a public performance and should be paid for.

The Digital Media Association (DiMA), the organization that represents Web-based music and media companies, contends that the music industry can't charge royalties for the music samples users hear before paying for songs. Jonathan Potter, executive director at DiMA, said that copyright laws protect companies like Apple and Amazon from paying fees for pre-purchase song sampling.

The music industry sees Internet downloads as a big shift in the way consumers get music, movies and TV shows, and the current model doesn't properly account for that change.

David Israelite, president and CEO of the National Music Publishers Association, commented "As more and more people watch TV or movies over an Internet line as opposed to cable or broadcast signal, then we're going to lose the income of the performance."

Mr. Potter, however, doesn't agree. "These guys are afraid that the business model is shifting away from public performances to a model of private performances," he said. "This is a turf battle. They are saying, 'The songwriters aren't getting paid.' Baloney. Songwriters are getting paid."

Since the music industry apparently can't get companies to agree to pay additional royalties, it took its cause to Congress in hopes of getting legislation passed that forces companies to pay the extra fees. It will likely be an uphill battle for the industry, but if it manages to get new laws passed, the end result will be higher song, movie and TV show download prices for consumers -- and that could lead to fewer sales, which is exactly what the music industry doesn't need.