As many know, the Mechanical Licensing Collective (MLC) is set to “go live” on January 1, 2021. Despite many worries that were expressed in 2018 when the MLC was authorized and despite delays caused by the COVID-19 pandemic, it appears that there will be no significant delays or requests to Congress for more time. It has been announced that the official MLC portal, designed for registering and uploading data to the MLC database, will be operational in October or November 2020. See report here. The portal was supposed to be operational by the end of the third quarter 2020, but that deadline is fast approaching and, likely, the launch will occur in October or November.
In preparation for the portal launch, earlier this summer 2020, the Mechanical Licensing Collective launched two online tools to help songwriters, musicians, music publishers and others ensure the accuracy of the MLC database and prepare for registration. See report here. The first tool is called the Data Quality Initiative (“DQI”) which allows for comparisons to be run on different data-sets to uncover and highlight discrepancies. In the lead-up to the official portal launch, MLC officials have prioritized eliminating errors and improving the quality of MLC’s data. Both are essential to smooth and efficient payment processing starting in 2021. The DQI is aimed at helping those with large libraries of songs and compositions.
The second tool launched this summer is called the Music Data Organization Form (“MDOF”). The MDOF is aimed to help what are designated as “self-administered” songwriters, composers and musicians. Basically, the MDOF is for independent artists with a small number of songs and/or compositions. The MDOF is designed to help registrants locate and gather the information that will be needed for uploading data to the MLC portal when it opens online in October or November 2020.
The MLC is another payment mechanism for musicians, songwriters, publishers and others in the music industry. The MLC is a compulsory blanket licensing arrangement that will collect and pay royalties related to use and performance of music by digital streaming and downloading services. There is no “opt-out” for musicians or others. But payment of royalties depends on members of the music industry registering with the MLC on their soon-to-be-launched portal. Owners must register and provide data for all their “musical works” including who owns the music, who owns the lyrics and who owns what percentage of works co-owned or co-written. The digital streaming and downloading services will pay the MLC and the MLC will pay musicians, songwriters and publishers. Currently, for unregistered musical works, royalties will be held for three years and then those royalties will be distributed to other composers, musicians and publishers based on their market share. In other words, if a musician does not register, he or she will not get paid and, after three years, someone else will get their royalties.
The MLC was authorized by the Music Modernization Act (“MMA”) enacted in 2018. Based on current projections, the MLC is expecting to send out the first set of royalty payments in the spring of 2021.
Contact an Experienced New York Music Lawyer Today
For more information, contact the business, entertainment, and IP lawyers at Cordero Law. Our entertainment law practice focuses on the music industry. We can help if you have questions about registering with the MLC or about other music licensing agreements. Licensing agreements are complex and you need to consult a top-tier music industry attorney for advice and counsel. Contact us via our online Contact Page or by calling (212) 960-8890.