Wanted: A PROperly designed royalty payment system

By Kira Grunenberg, November 6, 2014

Some thoughts on a recent upswell of news about local businesses coming under fire from US PROs:

Exhibit A: Bauhaus Kaffee
Exhibit B: Nine separate businesses local to Long Island, NY / Small bit of reporting on the same stories, from a third, non-ASCAP party

For the non-music business savvy folk out there, PRO=Performing Rights Organization. Companies that make sure royalty checks get sent out to songwriters and musicians who have registered with them.)

The PRO infrastructure is, I will admit, flawed but necessary. The problem is that in order for businesses of varying sizes to attain the kind of flexibility ideally being sought, things (read: things like set lists and venue capacities) would need to be reported honestly, and EVERY single time in order for data to stay transparent and everyone to be happy. Many times, the case ends up being that places like smaller, local restaurants don’t know all the minute details that go into the flow of this PRO system and that’s when “breaches” start to happen and subsequently build up. It’s not a crime to not be super versed in the overly complex ways of the music business when all you’re trying to do is giving local musicians a stage to play on. Nevertheless, that doesn’t mean the PROs are the ones to blame either.

Think of it like filing taxes. There’s a system that is all together complex, full of small print, widespread and mandatory but, simultaneously has a sub-system of bracketed differentiations for everyone *in* the system. At the same time, plenty of people hate the headaches that come with tax season and in dealing with the IRS in general but the system continues to exist for a reason.

 

That way, everyone is on the same page before anything even occurs and no one is scrambling to figure out what’s going on. The other thing that needs to be accounted for is that fact that the whole PRO system is affected by a lot of factors controlled by a lot of different parties.

• A) The songwriters of the world who choose whether or not to register with a PRO

• B) The venues who choose to track plays and file data with PROs

• C) The efficiency of the PROs in getting the most royalties possible, as fast as possible, out to the musicians/songwriters who have registered with them and for whom they represent.

The two sides of “stifling the little guy” and “compensating artists who have made it and deserve to be paid for the use of their art (read: work)” both have merit and the debate is probably destined to be a never-ending one. Still, just as it is a songwriter’s choice not to link up with a PRO, for those that do, it is unfair to not expect to have access to the benefits promised them by making the choice to register and connect. If, as a rebuttal, you are thinking, “But restaurant / venue owners aren’t the ones that are joining or not joining a PRO,” aside from my hypothetical proposal about pre-launch evaluation, it can also be looked at like drinking in a venue. If a business owner doesn’t own a liquor license, they don’t serve alcohol. If you do serve alcohol without one or if underage drinking happens with or without one, owners are subject to a penalty. Business owners don’t seem to take issue with a penalty for that, so, in a way, getting up to speed on expectations for inclusion of live music and keeping your records with that current, can be viewed much the same way. The actual metrics of what’s owed is another branch of the problem and that is certainly part of the subject that can stand for systematic alteration.

The thing is, if the system isn’t ready to change, the best a person can do in the mean time is stay inside the lines. The crux of the issue is that so often we want to box the whole of what music means, and where it fits in the human existence, as a single definition: universal and something that shouldn’t be so analyzed, dissected and controlled. However, if one musician’s relationship with music is that of art leading to profit and another musician’s relationship is art for art’s sake, then to insist upon a singular system that only nods to one of those lifestyle pursuits is a futile effort.

Again, I will say, the system is flawed. It cannot, and should not, exist without taking the nature of small, localized, non-industry trenched artists and performers into account. However, it also cannot ignore those that conversely choose to actively make an effort to do the work to become bigger and make a profit for what they consider to be a source of livelihood, no matter how subjective, artistic and emotionally charged that source may be. How the music industry as a single entity can come to balance these directly conflicting perspectives and approaches is the dilemma with which needs to be carefully and attentively dealt.