Capítulo IV: Análisis de Alternativas
4.04. Análisis de la Matriz del Marco Lógico
a.
ThePROs
Asmentionedabove,althoughmusicalcompositionswereexpresslymadesubjectto copyrightprotectionstartingin1831,Congressdidnotgrantmusiccreatorsthe exclusiverighttopubliclyperformtheircompositionsuntil1897.108 Thoughthisright
representedanewwayforcopyrightownerstoderiveprofitfromtheirmusicalworks, thesheernumberandfleetingnatureofpublicperformancesmadeitimpossiblefor copyrightownerstoindividuallynegotiatewitheachuserforeveryuse,ordetectevery caseofinfringement.109 ASCAPwasestablishedin1914,followedbyotherPROs,to
ofitsprovisionsregardingtemporarycopiesandrecognitionthatinteractivestreaminginvolves themakingofDPDs. Id. at1277‐81.
105See Reforming Section 115 of the Copyright Act for the Digital Age: Hearing Before the Subcomm. on
Courts, the Internet, and Intell. Prop. of the H. Comm. on the Judiciary,110thCong.4(2007) (“Reforming Section 115 Hearing”)(statementofRep.HowardCoble).
106See generally Copyright Office Views on Music Licensing Reform: Hearing Before the Subcomm. on
Courts, the Internet, and Intell. Prop. of the H. Comm. on the Judiciary,109thCong.21‐36(2005) (“Copyright Office Views on Music Licensing Reform Hearing”)(statementofMarybethPeters, RegisterofCopyrights).
107Id. at56‐57(letterfromJonathanPotter,ExecutiveDirector,DiMA); id. at59‐60(letterfrom
StevenM.Marks,RIAA); id. at99(commentsofASCAP); id. at62‐64(commentsofNMPA).
108See SteveWilf, The Making of the Post‐War Paradigm in American Intellectual Property Law,31
COLUM.J.L.&ARTS139,176(2008);NoelL.Hillman, Intractable Consent: A Legislative Solution to the Problem of Aging Consent Decrees in United States v. ASCAP and United States v. BMI,8FORDHAM INTELL.PROP.MEDIA&ENT.L.J.733,737(1998).
109BMI v. CBS,441U.S.1,4‐5(1979); see also Alden‐Rochelle, Inc. v. ASCAP,80F.Supp.888,891
addressthelogisticalissueofhowtolicenseandcollectpaymentforthepublic performanceofmusicalworksinawiderangeofsettings.110
Today,thePROsprovidevariousdifferenttypesoflicensesdependinguponthenature oftheuse. Anyonewhopubliclyperformsamusicalworkmayobtainalicensefroma PRO,includingterrestrial,satelliteandinternetradiostations,broadcastandcable televisionstations,onlineservices,bars,restaurants,liveperformancevenues,and commercialestablishmentsthatplaybackgroundmusic.
Mostcommonly,licenseesobtainablanketlicense,whichallowsthelicenseetopublicly performanyofthemusicalworksinaPRO’srepertoireforaflatfeeorapercentageof totalrevenues.111 Someusersoptforablanketlicenseduetoitsbroadcoverageof
musicalworksandrelativesimplicityascomparedtoothertypesoflicenses. Large commercialestablishmentssuchasbars,restaurants,concertvenues,stores,andhotels oftenenterintoblanketlicensestocovertheiruses,payingeitherapercentageofgross revenuesoranannualflatfee,dependingontheestablishmentandthetypeandamount ofuse.112 TerrestrialradiostationsobtainblanketlicensesfromPROsaswell,usuallyby
meansoftheRMLC.113 Manytelevisionstations,throughtheTMLC,alsoobtainblanket
licenses.114
Lesscommonlyusedlicensesincludetheper‐programorper‐segmentlicense,which allowsthelicenseetopubliclyperformanyofthemusicalworksinthePRO’srepertoire forspecifiedprogramsorpartsoftheirprogramming,inexchangeforaflatfeeora percentageofthatprogram’sadvertisingrevenue.115 Unlikeablanketlicense,theper‐
programorper‐segmentlicenserequiresmoredetailedreportinginformation,including programtitles,thespecificmusicselectionsused,andusagedates,makingthelicense moreburdensomeforthelicenseetoadminister.116
Userscanalsolicensemusicdirectlyfrommusicpublishersthroughadirectlicenseora sourcelicense. Adirectlicenseissimplyalicenseagreementdirectlynegotiated
110BMI v. CBS,441U.S.at4‐5; see also Alden‐Rochelle,80F.Supp.at891. 111Meredith Corp.,1F.Supp.3dat190; BMI v. CBS,441U.S.at5.
112See KOHNat1263,1275‐80. TheCopyrightActexemptsmanysmallcommercialestablishments
fromtheneedtoobtainapublicperformancelicense. See 17U.S.C.§110(5).
113DavidOxenford, What is the RMLC, And Why Should a Radio Station Pay Their Bill?,BROAD.L.
BLOG(Aug.24,2012),http://www.broadcastlawblog.com/2012/08/articles/what‐is‐the‐rmlc‐and‐
why‐should‐a‐radio‐station‐pay‐their‐bill.
114Meredith Corp.,1F.Supp.3dat189‐90.
115See generally LaurenM.Bilasz, Note: Copyrights, Campaigns, and the Collective Administration of
Performance Rights: A Call to End Blanket Licensing of Political Events,32CARDOZOL.REV.305,323& nn.111‐112(2010)(descriptionsofeachlicense).
betweenthecopyrightownerandtheuserwhointendstopubliclyperformthemusical work. Sourcelicensesarecommonlyusedinthemotionpictureindustry,becausethe PROsareprohibitedfromlicensingpublicperformancerightsdirectlytomovietheater owners.117 Instead,filmproducerslicensepublicperformancerightsforthemusicused
infilmsatthesametimeasthesynchronizationrights,andpasstheperformancerights alongtothetheatersthatwillbeshowingtheirfilms.118 Inthecontextofmotion
pictures,sourcelicensesdonottypicallyencompassnon‐theatricalperformances,such asontelevision. Thus,televisionstations,cablecompanies,andonlineservicessuchas NetflixandHulumustobtainpublicperformancelicensesfromthePROstocoverthe publicperformanceofmusicalworksintheshowsandmoviestheytransmittoend users.119
b.
AntitrustOversight
Basic Antitrust Principles
Unlikethemechanicalright,thepublicperformanceofmusicalworksisnotsubjectto compulsorylicensingundertheCopyrightAct. But,asdescribedbelow,ASCAPand BMIaresubjecttogovernmentantitrustregulationthroughlongstandingconsent decrees. AndwhileneitherSESACnorGMRissubjecttosuchdirectantitrust
regulation,each,ofcourse,mustabidebygenerallyapplicableantitrustlaw,whichis enforceablebythegovernmentorthroughprivatecausesofaction. SESAC,forexample, hasrecentlybeenthesubjectofprivateantitrustsuits,asdiscussedbelow. Adetailed explanationoftheantitrustrationalethatunderliesthePROconsentdecreesisbeyond thescopeofthisstudy. Butabriefdiscussionofsomebasicantitrustprinciplesmaybe helpfulinunderstandingthemotivationbehindthedecrees.
Section1oftheShermanAntitrustActprohibits“[e]verycontract,combinationinthe formoftrustorotherwise,orconspiracy,inrestraintoftradeorcommerceamongthe several[s]tates.”120 AstheSupremeCourthasopined,however,“Congresscouldnot
haveintendedaliteralinterpretationoftheword‘every,’”andasaresult,courts
117Thisprohibitionwasaresultofantitrustlitigationbroughtbymovietheaterownersinthe
1940s. Alden‐Rochelle,80F.Supp.888;see also ChristianSeyfert, Copyright and Anti‐Trust Law: Public Performance Rights Licensing of Musical Works into Audiovisual Media 6,20(Sept.1,2005) (unpublishedLL.M.thesis,GoldenGateUniversitySchoolofLaw), available at http:// digitalcommons.law.ggu.edu/theses/13at19.
118See id. at19.
119Id.; see also NetflixFirstNoticeCommentsat1‐2; ASCAP Reports Increased Revenues in 2011,
ASCAP(Mar.8,2012),http://www.ascap.com/press/2012/0308_ascap‐reports.aspx(reflecting blanketlicenseswithNetflixandHulu). LicensingofperformancerightsfromSESACandGMR occurswithoutdirectantitrustoversight,andthosesmallerPROsmayrefusetolicensetheir repertoirestopotentiallicensees.
“analyze[]mostrestraintsundertheso‐called‘ruleofreason.’”121 Theruleofreasontest
requiresacourttonotonlyfindarestraintoftrade,butalsodeterminewhetherthat restraintisunreasonable.122 TheSupremeCourthasalsorecognized,however,that
“[o]nceexperiencewithaparticularkindofrestraintenablestheCourttopredictwith confidencethattheruleofreasonwillcondemnit,ithasappliedaconclusive
presumptionthattherestraintisunreasonable.”123 Thus,certainarrangements—
includingprice‐fixingagreements—aredeemedperseviolationsofsection1.124
A“tying”arrangementisanotherkindofbusinesspracticethatraisesantitrustconcerns. Atyingarrangementis“anagreementbyapartytoselloneproductbutonlyonthe conditionthatthebuyeralsopurchasesadifferent(ortied)product.”125 Such
arrangementsareunlawful“ifthesellerhas‘appreciableeconomicpower’inthetying productmarketandifthearrangementaffectsasubstantialvolumeofcommerceinthe tiedmarket.”126 ButastheFederalTradeCommission(“FTC”)observes,“[t]helawon
tyingischanging.”127 WhiletheSupremeCourt“hastreatedsometie‐insasperseillegal
inthepast,lowercourtshavestartedtoapplythemoreflexible‘ruleofreason’toassess thecompetitiveeffectsoftiedsales.”128
Department of Justice Consent Decrees
Since1941,ASCAPandBMI’slicensingpracticeshavebeensubjecttoantitrustconsent decreesoverseenbytheAntitrustDivisionoftheDOJandenforcedbyfederaldistrict courtsinNewYorkCity.129 Thoseconsentdecreeswereimplementedinreactionto
allegedanticompetitivepracticesofASCAPandBMI. Specifically,whenoriginally formed,bothPROsacquiredtheexclusiverighttonegotiatemembers’public performancerights,andforbadetheirmembersfromenteringintodirectlicensing
121Arizona v. Maricopa Cnty. Med. Soc’y,457U.S.332,342‐43(1982). 122Associated Press v. United States,326U.S.1,27(1945).
123Arizona,457U.S.at343‐44. 124Id. at344‐45.
125N. Pac Ry. Co. v. United States,356U.S.1,5(1958).
126Eastman Kodak Co. v. Image Technical Servs., Inc.,504U.S.451,4662(1992).
127Tying the Sale of Two Products,FTC,http://www.ftc.gov/tips‐advice/competition‐guidance/
guide‐antitrust‐laws/single‐firm‐conduct/tying‐sale‐two‐products(lastvisitedJan.26,2015).
128Id.
129See generally United States v. BMI,275F.3d168,171‐72(2dCir.2001)(describingthehistory); see
also Antitrust Consent Decree Review,U.S.DOJ,http://www.justice.gov/atr/cases/ascap‐bmi‐decree‐
arrangements. Additionally,bothofferedonlyblanketlicensescoveringallofthemusic intheirrespectiverepertoires.130
Inthe1930s,theDOJ’sAntitrustDivisioninvestigatedASCAPforanticompetitive conduct—specificallythatASCAP’slicensingarrangementsconstitutedprice‐fixing and/orunlawfultying.131 Thegovernmentsubsequentlyfiledfederalcourtactionsin
1934and1941,arguingthattheexclusiveblanketlicense—astheonlylicenseofferedat thetime—wasanunlawfulrestraintoftradeandthatASCAPwaschargingarbitrary pricesasaresultofanillegalcopyrightpool.132 Whilethefirstcasewasneverfully
litigatedafterthegovernmentwasgrantedamid‐trialcontinuance,thelatteractionwas settledwiththeimpositionofaconsentdecreein1941.133 Thatconsentdecreehasbeen
modifiedtwice,firstin1950andmostrecentlyin2001.134 TheUnitedStatesalso
pursuedantitrustclaimsagainstBMI,resultinginasimilarconsentdecreein1941.135
The1941BMIconsentdecreewassupersededbyanewdecreein1966,whichwaslast amendedin1994.136
AlthoughtheASCAPandBMIconsentdecreesarenotidentical,theysharemanyofthe samefeatures. Asmostrelevanthere,thePROsmayonlyacquirenonexclusiverightsto licensemembers’publicperformancerights;mustgrantalicensetoanyuserthat
applies,ontermsthatdonotdiscriminateagainstsimilarlysituatedlicensees;andmust acceptanysongwriterormusicpublisherthatappliestobeamember,aslongasthe writerorpublishermeetscertainminimumstandards.137
ASCAPandBMIarealsorequiredtoofferalternativelicensestotheblanketlicense. Oneoptionistheadjustablefeeblanketlicense,ablanketlicensewithacarve‐outthat reducestheflatfeetoaccountformusicdirectlylicensedfromPROmembers. Under theconsentdecrees,ASCAPandBMImustalsoprovide,whenrequested,“through‐to‐
the‐audience”licensestobroadcastnetworksthatcoverperformancesnotonlybythe networksthemselves,butalsobyaffiliatedstationsthatfurthertransmitthose
130ChristianSeyfert, Copyright and Anti‐Trust Law: Public Performance Rights Licensing of Musical
Works into Audiovisual Media at6,20; see also Wilfat177.
131Seyfert, Copyright and Anti‐Trust Law: Public Performance Rights Licensing of Musical Works into
Audiovisual Media at20‐21.
132BMI v. CBS,441U.S.at10.
133Seyfert, Copyright and Anti‐Trust Law: Public Performance Rights Licensing of Musical Works into
Audiovisual Media at20‐21.
134BMI v. CBS,441U.S.at11. 135BMI v. CBS,441U.S.at12n.20.
136Seyfert, Copyright and Anti‐Trust Law: Public Performance Rights Licensing of Musical Works into
Audiovisual Media at22; see also BMIConsentDecree.
performancesdownstream.138 ASCAPandBMIarealsorequiredtoprovideper‐
programandper‐segmentlicenses,asaredescribedabove.139
ASCAPisexpresslybarredfromlicensinganyrightsotherthanitsmembers’public performancerights(i.e.,ASCAPmaynotlicensemechanicalorsynchronization rights).140 AlthoughBMI’sconsentdecreelacksasimilarprohibition,inpracticeBMI
doesnotlicenseanyrightsotherthanpublicperformancerights.141
Finally,andperhapsmostsignificantly,prospectivelicenseesthatareunabletoagreeto aroyaltyratewithASCAPorBMImayseekadeterminationofareasonablelicensefee fromoneoftwofederaldistrictcourtjudgesintheSouthernDistrictofNewYork.142 The
ratecourtproceduresarediscussedingreaterdetailbelow.
InresponsetorequestsbyASCAPandBMItomodifycertainprovisionsoftheirdecrees, theDOJ’sAntitrustDivisionannouncedinJune2014thatitwouldbeevaluatingthe consentdecrees,andhassolicitedandreceivedextensivepubliccommentsonwhether andhowthedecreesmightbeamended.143 Specifically,bothASCAPandBMIseekto
modifytheconsentdecreestopermitpartialgrantsofrights,toreplacethecurrent ratesettingprocesswithexpeditedarbitration,andtoallowASCAPandBMItoprovide bundledlicensesthatincludemultiplerightsinmusicalworks.144 TheDOJhas
expresseditsintentto“examinetheoperationandeffectivenessoftheConsentDecrees,” particularlyinlightofthechangesinthewaymusichasbeendeliveredandconsumed sincethemostrecentamendmentstothosedecrees.145 Atthesametime,theDOJis
138ASCAPConsentDecree§V;BMIConsentDecree§IX.
139ASCAPConsentDecree§§II.J‐K,VII;BMIConsentDecree§VIII.B. Notethatunderthe
ASCAPconsentdecree,theper‐segmentlicensehasanumberofconditionsthatmustbemet beforeitcanbeused. ASCAPConsentDecree§VII.
140ASCAPConsentDecree§IV.A.
141See BMI,CommentsonDepartmentofCommerceGreenPaperat4‐5(Nov.13,2013), available
at http://www.ntia.doc.gov/files/ntia/bmi_comments.pdf.
142ASCAPConsentDecree§IX;BMIConsentDecree§XIV.
143Antitrust Consent Decree Review,U.S.DOJ,http://www.justice.gov/atr/cases/ascap‐bmi‐decree‐
review.html(lastvisitedJan.26,2015).
144ASCAP,CommentsSubmittedinResponsetotheDOJ’sAntitrustConsentDecreeReviewat
18,22,31(Aug.6,2014), available at
http://www.justice.gov/atr/cases/ascapbmi/comments/307803.pdf(“ASCAPAntitrustConsent DecreeReviewComments”);BMI,CommentsSubmittedinResponsetotheDOJ’sAntitrust ConsentDecreeReviewat2(Aug.6,2014), available at http://www.justice.gov/atr/cases/ascapbmi/ comments/307859.pdf(“BMIAntitrustConsentDecreeReviewComments”).
145Antitrust Consent Decree Review,U.S.DOJ,http://www.justice.gov/atr/cases/ascap‐bmi‐decree‐
conductingarelatedinvestigationtodeterminewhethertherehasbeenacoordinated effortamongmusicpublishersandPROstoraiseroyaltyrates.146
Key Antitrust Cases
InadditiontotheDOJactionsthatledtotheadoptionoftheconsentdecrees,PRO practiceshavebeenthesubjectofprivateantitrustactions,includinganumberrelatedto theconsentdecrees. Thedecisionsinthesecasesservetohighlightcourts’approachto thecollectivelicensingofpublicperformancerightsandadministrationoftheconsent decrees.
Inthe1979SupremeCourtcaseofBMI v. CBS,CBShadsuedASCAPandBMI,alleging thattheblanketlicenseviolatedantitrustlawsbyconstituting“illegalpricefixing,an unlawfultyingarrangement,aconcertedrefusaltodeal,andamisuseofcopyrights.”147
Ratherthandeclaringtheblanketlicensesperseunlawful,theCourtheldthatthey shouldbeevaluatedundera“ruleofreason”test,observingthatablanketlicensecould beusefultoaddresstheproblemofnegotiatingthousandsofindividuallicenses. The Courtalsonotedasrelevantthefactthattherewereno“legal,practical,orconspiratorial impediment[s]”toobtainingdirectlicenses,indicatinglicenseeshavearealchoiceinthe directlicenseasanalternativetotheblanketlicense.148 Onremand,thecourtofappeals
upheldtheblanketlicenseundertheruleofreason,explainingthatitdidnot unreasonablyrestraincompetitionbecauseCBScouldfeasiblyobtaindirectlicenses fromcopyrightowners.149
AftertheBMI v. CBS litigation,anumberofothercourtsexaminedtheblanketlicense, andsustaineditagainstantitrustchallengesunderrule‐of‐reasonanalysis. InBuffalo Broadcasting v. ASCAP,theSecondCircuitconcludedthat,inthecontextoflocal televisionstations,theblanketlicensedidnotviolatetheShermanActbecauseper‐
programlicenses,directlicenses,andsourcelicenseswererealisticalternativestothe blanketlicense.150 AfederaldistrictcourtintheDistrictofColumbiareachedasimilar
conclusionwithrespecttocablestations.151
146EdChristman, Dept. of Justice Sends Doc Requests, Investigating UMPG, Sony/ATV, BMI and
ASCAP Over Possible “Coordination,” BILLBOARD(July13,2014),http://www.billboard.com/biz/ articles/news/publishing/6157513/dept‐of‐justice‐sends‐doc‐requests‐investigating‐umpg‐
sonyatv. MembersoftheDOJAntitrustDivisionattendedandobservedtheOffice’sroundtables forthisstudyinNashvilleandNewYork.
147BMI v. CBS,441U.S.at6. 148Id. at24.
149CBS v. ASCAP,620F.2d930,938‐39(2dCir.1980).
150Buffalo Broad. v. ASCAP,744F.2dat926‐32; see also id. at934(Winter,J.,concurring)(“[S]olong
Morerecentlitigationhasinvolvedroyaltyratedisputes. In2012,theSecondCircuit addressedratedisputesinvolvingASCAPandBMI,ontheonehand,andDMX,a backgroundmusicservice,ontheother,regardingtheratetobepaidforanadjustable‐
feeblanketlicense.152 Inarguingforalowerrate,DMXpointedtodirectlicensesithad
enteredintowithanumberofcopyrightowners,mostofthemsmallerpublishers,on relativelyfavorabletermsforDMX.153 DMX,however,alsoreliedonadirectlicense
fromSony/ATV,amajormusicpublisher. ThatdealgaveSony/ATVaproratashareof thesameannualrateasothersmallerpublishers,butalsoprovidedSonya$2.4million advanceanda$300,000administrativefee.154 Thecourtfoundthisandtheotherdirect
dealsenteredintobyDMXtobepersuasivebenchmarksandthattheratecourts
reasonablyconsideredDMX’sdirectlicensesintheirratedeterminations. Althoughthe PROsarguedthatthesubstantialadvancepaidtoSony/ATVrenderedthatlicensean inadequatebasistosetratesfortheremainderofpublisherscoveredbyPROlicenses, thecourtofappealsaffirmedtheratesadoptedbytheratecourts.155
TherehasalsobeenrecentlitigationbetweenthePROsandPandora,theinternetradio