Navigating Performance Rights Within Music

Terrestrial Radio was still allowed, actuallyallowed, to play any music they wanted without permission. You cannot hold your music back from TerrestrialRadio in this country. And there's no obligation for them to paythe sound recording copyright owners, so the artists and the labels. Once in a while in South Connections, we havespecific topics that are hard to understand.

We try to deep dive into them so we can learn something about their entrepreneurial opportunities in the music industry. With Linda, we're going to talk about performancerights and a lot of the things in the industry that just doesn't make sense. Linda, welcome to Sound Connections podcast. Thank you, Jacob. It's so great to be here.

I'm lucky to have you here. You are a person who knows a lot about a lotof stuff within the music industry, but today we're gonna talk about neighboring rightsand sort of associated relevant things to know about that. But Linda, I met you at a conference becauseyou were chosen to be one of the clever people who knew a lot about a lot of stuff.

Could you just walk me through What have you done and why are you so knowledgeable? That is a lot of pressure, Jacob, to be cleverabout a lot of stuff. And I really am grateful to be here. It was such a pleasure to meet you at a conferencein Europe about a month ago. So it's almost coming up on our anniversaryhere.

So Jacob, I started my career in the musicindustry on Capitol Hill here in the United States, which is where- the laws are written, which is a very fascinatingplace to be in the late 90s, early aughts when the digital transformation was happeningfor everybody, for every context of the world, particularly for the entertainment industry.

So I had this wonderful front row seat toall of the issues that were in play, the laws that had to be in place to allow that digitaltransformation to happen, and got to hear every aspect of the entertainment industry,whether it be video or film or photography or authors that would come up to Capitol Hilland want to weigh in on what that legislation needed to contain to protect the copyrightsand intellectual property of creators.

So that's where I really kind of started tocut my teeth on a lot of these issues as a part of that bill here in the United States. It was called the Digital Millennium CopyrightAct here in the United States. As part of that, there was really an updateto how royalties were going to be collected and distributed in the digital age.

As part of that bill, they actually createda collective, a performing rights organization, they created a performing rights organizationthat was able to, for the first time, collect digital royalties for the sound recordingperformance right.

So that had never been done here at all. The terrestrial radio here in the States andother performance doesn't pay on the sound recording half of the copyright. And so the Digital Millennium Copyright Act,among many other things that allowed Steve Jobs to create iPods and iPads and then iPhones, It also allowed for the creation of a collectionorganization that was able to kind of participate in these digital royalties that later becameSound Exchange, as it's been known around the world for the last 20 years.

But the irony of my career is that I startedon Capitol Hill kind of writing the law that actually created, so to speak, Sound Exchange. in 2003 to actually go work for UniversalMusic and Universal Pictures. It was one company at the time and workedon the whole overarching umbrella of all of their intellectual property rights.

Until I got a call in 2005 from the CEO ofthe newly formed, newly acquired Warner Music Group. There are three major labels here in the UnitedStates, well, around the world. Warner Music and Universal and Warner Musichad just been acquired by a gentleman and some investors.

His name was Edgar Bronfman Jr. and he hadbought the company in 2005 from Time Warner and started it as its own standalone musiclabel and asked me to please consider running his Washington DC office for the new company,which was fantastic time. It was right at the heart of all these technologies coming online.

The Grokster case had hit the Supreme Courthere in the United States. It was a very exciting time for intellectualproperty rights holders and what was going to be their future in the digital age. I ran that office for the whole time thatEdgar Bronfen was CEO for about six years and then jumped back to the video side, workedfor Time Warner for two years after that.

At that point, it was just the video propertiesof Time Warner and their magazines as well. After that, I really, while I was there andworking for this incredible Fortune 50 company, which was an amazing experience, I alwaystell people I felt like I got an MBA for free while I was working for the industry. It really hit me though that the creators,the actual creators, the writers, the drummers, the painters, the screenplay writers, theyall, you know, We're having a voice here in Washington, D.C.,but in my opinion at the time, it needed to be amplified.

So I walked into Time Warner one day, I thankedthem for the opportunity and told them I was going to go start my own business to do twothings, to help artists and creators and to teach, I really wanted to teach. So those were the two reasons that took meout of the corporate world after representing them here in Washington for about 20 years.

And... and then started my own company called LBBCreative Strategies. The very first day that I had started thatcompany, the first client on my doorstep was SoundExchange. So they said, we represent creators. You want to represent creators. This is a perfect match. Come on and work for us and help representcreators.

And that was the irony of my career is I hadkind of written this bill that created this incredible organization that was out therecollecting money for creators. And I was like, oh, I'm going to do this. and then I got to go work there. I consulted with my company for about a yearand then went in-house and did industry relations for SoundExchange for eight years, and thenwent back to the government affairs side for about two.

So by the time I left SoundExchange this pastspring, I left as the senior VP of public policy and government relations, but I hadspent the better part of 10 years working for the company, doing industry relationsand just really communicating the word of what a PRO does, collective rights organization does for peoplearound the world.

Wow. And that takes me today. So I left in July, I left SoundExchange inJuly because that other half of what I wanted to do, I had been teaching as an adjunct forabout 10 years. And then when the opportunity came for meto help run American Universities business and entertainment program, I definitely jumped in the deep end of the pool,became a full-time faculty member.

I'm helping the founder of that program, JohnSimpson, who by the way was also the first CEO of SoundExchange, now runs that programat AU and invited me to come and be his assistant and teach full-time starting this past August. So now in the academic world, which was wonderfulbecause it's one of many things that took me to the wonderful conference I met you atin Christian Sand, Norway.

And, uh, and I'm now getting to work with the next generation of leaders in the entertainment industry, which is really an incredible pivotalpoint of my career. I am just loving kind of spending time with,with young minds and hearing their ideas and helping them kind of navigate the waters ofthe entertainment industry they're entering here in 2023.

Yeah.I think that's a key point. One of the things, even though I'm young myselfis also How can we help the next generation of themusic industry and entrepreneurs especially? Because the music industry historically speakinghas maybe not been the greatest industry to be in, in many ways, especially when it comesto what sound exchange is representing people getting paid for that aspect.

Before we go into all of this, could you justhelp me on a basic level understand what is performance rights? What is terrestrial radio? What is all the things that sound exchangeworked with that he helped create the bills? What are those? Well, as you know, there's the two sides ofthe copyright.

Actually, you've got the composition piece,and then you have the sound recording piece, both of which need to be kind of, you needa collective organization to make sure that everybody who owns those rights are gettingpaid. It would be certainly nice if you could walkinto a bar and recognize every single writer and.

and performer that are on a track that happensto be on the background in that bar that you're enjoying, but you might not even know you'reenjoying it because it's kind of, that's really, really difficult for anybody to manage. And that became apparent even back when wewere just talking about live music, when we weren't even talking about recorded music. You know, performance rights have been aroundfrom the mid 1800s in France is where they started.

So that recognition that you need a performancerights organization to help. pay the right people to keep all of those records, to let people do their business legitimately and engage in the commerce, but make it aseasy as possible. So performance rights exist, at least I'llspeak primarily from the United States, which is the law I'm most familiar with, for boththe writers of tracks and the performers of tracks.

One piece that's very important, particularlyhere in the United States, but it's a global One place that music is performed quite readilyis terrestrial radio. So what is terrestrial radio? It's AM, FM radio. It's over the airwaves. It's traditionally the way people have discoveredand listened to music up before the digital age.

So we've got terrestrial radio, and now, ofcourse, you've got non-interactive radio. You've got internet radio, which is anotherbig way that people consume music, and then all of the interactive services that peopleuse. enjoy. Performance rights comes when music is beingperformed for what for a large audience, whether it be in the radio, whether it be in a stadiumor a restaurant, bar, mall, hotel, any kind of public performance triggers that part ofthe Copyright Act.

So if your song is being performed for otherpeople to hear it, when you might not know about that, you are as a copyright owner,whether it be the writer, And in some cases, the sound recording copyrightowner, you're entitled to your royalties. So specifically, the bulk of my career, asI said, was spent on the sound recording side of copyright law here in the United States.

The sound recording copyright owners get paidin the United States only when their music is played on digital radio. So any digital transmission, this was partof that DMCA bill that we wrote back in the late 90s. is when royalty orders can get paid. If there's a digital transmission, a digitalperformance, you are entitled to a performance right.

And you need these collective rights, thesecollective management organizations to help account and account for that and keep trackof not only everything that's being played, but what needs to be paid out. Obviously there's, you know, more broad public performance rights herein the United States that are, like I said, for bars, restaurants, any type of malls,any type of external blade to enjoy it.

Typically, the writers are only, they getpaid for that. The sound recording copyright owners do not. But there are, as you know, four major PROshere in the United States that do the bulk of that collection for the writers and thusthe publishers as well. Why is it Because I right now live in Norway and it'snot just digital radio that is getting April rights, this rights payment, it's also a terrestrial radio.

Why is it in America, which is such a bigmarket, that terrestrial radio does not pay this out? You've just struck the center point of myentire career, Jacob. I've been fighting for creators, whether theybe the label side, the individual side, to actually change that law here in the UnitedStates.

People often ask me why I'm headquarteredin Washington, DC, if I work for a music company or the music industry, because it's not reallythe music capital of the world. It's because... On Capitol Hill, there are many issues, aswas the case with the DMCA, as was later the case with its successor, the Music ModernizationAct in 2018. One piece of legislation that has not beensuccessful, both on the DMCA, and in the Music Modernization Act, and in every other iterationthat the bill has been in for the last really kind of 50 years that we've been fightingfor this, is the terrestrial performance.

So The answer to your question is really precedentand history. So back in the day when artists would go tohave their music played on the radio, before we had these round pieces of plastic thatwere recordings, they would walk into a radio station, they would sing their song or twoon a Saturday night, the radio station would broadcast it, and they'd give the artistsand maybe the band a couple hundred bucks, they would go home, that was it.

Then in the 50s and 60s, radio stations startedusing recorded music to blast over their airwaves. And that model never changed. One thing that has always been constant herewith terrestrial radio is that writers get paid. So, the thinking back in the day when we hadthose live performances was you couldn't identify the writer. You could hear the singer, but you couldn'tidentify the writer.

So writers have always gotten paid for terrestrialradio in this country, but the performers did not. The thinking back, the excuse, so to speak. that radio would give was you're getting promotionfor your music. We're promoting your music, we're promotingyou, and people will go down to the record store and buy a record and it all comes outin the wash. And so for those years that was actually happening, you know, that there wasn't a whole lot of recognition of this problem.

But when the digital transition happened andpeople stopped going to record stores and buying round pieces of plastic, the laws neverchanged. Terrestrial radio was still allowed, actuallyallowed to play any music they wanted without permission. You cannot hold your music back from terrestrialradio in this country. And there's no obligation for them to paythe sound recording copyright owners, so the artists and the labels.

So there have been many, many attempts. And like I said, Jacob, it's kind of beenwhat I've spent the bulk of my career as I have, I look at one kind of central themethroughout this, this piece of it has been what I've been fighting for. because it does exist around the world. The sound recording copyright owners get paidin every country in the developed world.

The notable exceptions are like North Korea,and it was China, but China actually now has even better copyright laws for sound recordingperformances than the United States does. So that has changed, and everything aroundthe world, every country around the world is paying for this, but the United States, is not.

Like you said, in Norway, in Europe, acrossEurope, when music is played on the radio, artists are paid for that. And we would like that to be the case herein the United States, but that is one piece that SoundExchange did not collect on. So SoundExchange's core business that theywere currently collecting on and are currently collecting on is the non-interactive satelliteand webcasted radio.

So it's that piece of it, not the terrestrialradio. To ask you a more broader question, that'sa really interesting answer by the way, is for entrepreneurs or people who's in the musicindustry who wants to be entrepreneurial that's listening to this podcast, they need to adhereto certain regulations and laws about the industry and how you can monetize the music.

The process of not getting something throughthose two acts seems to be a result of lobbying. Could you walk me through what happens inthe different ends of the spectra? of trying to say, I want this, this needsto happen. And then there's a second, separate part tosay, no, we don't want that to happen. What is happening in that dynamic?

Sure. Absolutely. Well, I think this is true around the worldand anytime you want to get something done, it's easier to stop something than to getsomething. So in this example, the sound recording copyrightowners would like to have the royalties for... for digital, sorry, I'm gonna start that over.

The sound recording copyright owners wouldlike to have royalties when their music is played on the radio for free. They believe that they deserve to get paid. So they form a coalition, they find friendsthat agree with that. Here in the United States, it was the coalitionwas called the Music First Coalition. It was comprised of unions and record labelsand artists and you know, the Grammy organization, every kindof creative organization under the sun, created that coalition.

They band together, they write a bill, theytake it to the legislators and say, we would like to pass this bill. The people that would be affected and thatwould ultimately have to pay those royalties, i.e. the radio industry, the radio broadcastingindustry says, we don't want that bill to happen. We like things the way we are.

They've had, like I said over the years, somearguments about promotion. I would argue that just because something'sgetting promoted doesn't mean that you're not entitled to get paid for it. But the opponents to the bill, in this casethe broadcasters, then put up their lobbying operation to stop members from supportingthat bill. What's happened here in the past, and I saidhistory is really the reason it hasn't been done, is that the broadcasters are a very,very powerful lobbying organization.

There are broadcasting towers in every memberof Congress's districts around the country. How do those members of Congress get electedto Congress? They go home, they run ads on local radio. So it's a very close relationship that broadcasters have with their local legislator. So it's really difficult when they finallyget elected and their ads are listened to and they come to Washington and they're sittingin their offices and the broadcasting lobbyists have lots of tools.

at their disposal. They're a very well-funded lobby organizationhere in the United States. They're highly regulated. They have to have pretty large shops herein D.C. So now they're elected. The broadcasters come into their office andsay, you don't want to pass this bill. Come on, I'm going to go out of business. This is going to make me pay money I wasn'tpaying before. I already have to pay the writers.

Why should I have to pay the guy that singsthe song? I'm already paying the guy that writes thesong. And so that cozy relationship that was bornout of their hometown business, and perhaps in many cases, there's their friends froma lot of these congressional districts, has been so strong. It's a very formidable opponent in the broadcasting industry.

And the music industry just doesn't have thatbreadth of coverage, to be truthful. I mean, there were an industry that's locatedin major cities. New York, LA, Austin, Texas, Miami, Nashville,Tennessee. Those are the music centers here in the UnitedStates. We don't have a person necessarily that isas loud as a broadcast tower in every single congressional district that can get that wordout there.

So in my whole career, I've had hundreds oflegislators say to me, I know that this is the right thing to do, but I just don't wannatake on my local broadcaster. And the broadcasters do. a really stellar job of making sure that thoserelationships exist with all those members. And they've got political action money.

They've got these local relationships withthe business partners back home. So it just hasn't happened. It's really hard to get anything passed inthe United States Congress right now. and has been for a while and it's really hardto get it passed when you've got a formidable opponent that's out there, you know, puttingup all their forces to stop something.

I can see that's difficult. Was that enough lobbying 101? I think that was brilliant. It's just important, I think, for the musicindustry to understand that sometimes when we think changes should happen, and they shouldhappen, if you look at fairness, it doesn't mean that they will and can happen. And that's just sort of the reality of, Ithink, any industry, but something we really need to think about.

Just to understand for the listeners, becauselaws work differently in different territories and in UK and in America, a lot of it is builton president. Could you just briefly describe to me, whatdo you mean by president? the precedent of the way things have alwaysbeen done?

Yeah, the president of law, for example, youknew things being based on president of things. Yeah, like I said, it's really hard to changethe way things have been. Just politically it's difficult, legally it'sdifficult. There's business certainty on the way thatthings have been set up in terms of, if you're listening to an earnings call, for example,of somebody in the broadcast industry, They'll have to warn their investors thatthere could be this new risk to their business, that they would have to pay a fair royaltyto the people that create the core product of their business.

Needless to say, that's just not somethingthey've had to pay yet. When broadcasters get on their earnings callsand explain what possible risks are, they have to highlight this as one of them becausethere is pending legislation that could... pass and that could make these changes totheir bottom line. But it's just always hard to change that. And business certainty is something that you'llhear argued on Capitol Hill every day of the week when people are talking about makinga change to a law or regulation to differ operations from how they've been all along,particularly with a long history of an industry like broadcasting that's really never hadto pay this particular performance right.

I know that they do around the world. Radio stations are not going out of businessaround the world. They pay the singer and they pay the writerand everybody is happy and it's fair, but that's just, it's very difficult. And as you know, because that right doesn'texist here in the United States, that does affect collections around the world.

There's a debate going on in Europe rightnow about, there's a court case, the rap case that came out of Ireland. that basically would allow for the collectionof those royalties. But because that doesn't exist in the UnitedStates, Europeans are upset that somehow European money is going out to US artists because they'dbe treated as they were Europeans.

And that right doesn't exist here in the UnitedStates. And that's the first thing that people alwayspoint to. Well, if the United States artists reallywant this, why don't they just pass the law on their own country? So it's a global problem. problem that's becoming even more prevalentand current because that law does not exist here in the States.

Do you know if there's similar issues in themusic industry that can sort of been compared to the unfairness of this? Like are there other things that just haven'tcome through yet? Yeah. I mean, there's just kind of the constantongoing growing pains that the industry is having. because of the digital transition.

And while we think that my kids certainlycan't understand what it would be like to listen to music in the analog fashion, theyonly know that there is a digital way to get a song instantaneously on demand. That wasn't always the case and hasn't beenthat long. I mean, I started my career in the music industryin 2003.

We're just starting to understand. And we were starting to understand because ofthe illegal opportunities that people were doing, pirating people's work. But the industry eventually caught up andcame up with legitimate alternatives that fans and consumers did want to pay for. But it hasn't been around that long.

So there's just constant growing pains. And every time a new service comes on thescene, we need to think about, you know, what are the fair ways to make sure that... artists and rights owners get paid acrossthe board for their work. So there's opportunity there, of course, ifyou're an entrepreneur, to think creatively about is there a better way to make sure thatthere's fairness across the board.

But there's constant debates. The writers and publishers are always workingon the publishing rates that are paid. for interactive radio, for interactive services,digital services. So I think that there is a lot of other similardebates where artists and writers are saying this just isn't fair.

The new model is not catching up to the oldmodel. And that's OK. But they want to make sure that there's fairnessacross the board in the new model to make sure that the rates are set fairly. that the structure is set up so that there'sequal voices at the table who's deciding what those rates are going to be. So there's a lot of comparisons that you couldmake, not necessarily one-to-one where somebody's just absolutely out using work that you arenot allowed to withhold.

That's basically the biggest difference withthat debate and the interactive services. I mean, you'll remember two times Taylor Swifthas been able to hold back her music from services, which she doesn't think that they're... acting fairly, what was Apple Music when theyhad those free promotions. She said that you could have all the freepromotions you want, but you have to pay the rights owners that created the work whileyou're giving away your product for free.

And the other was Spotify, of course. She had a very high profile issue with Spotifywhere she was able to hold back her music. In the context of terrestrial radio here inthe United States, artists can't do that. If it's out there commercially available,then terrestrial radio can use it without permission. One of the things that you touch upon, I assume,is sort of the debate around the distribution of master rights versus publishing for DSPs.

That's one of the very active debates happening. Another debate also with that is sort of autocentric payments for streaming services. And nevertheless, what kind of topic it is,there's some people, a lot of people calling for change, but the similar situation withsound exchange or terrestrial radio, that is long journeys.

How do you see these things developing? If there were to be a debate around the sheerof master rights and publishing rights changing, how does that go about? I think that's a good question. Well, as with any, and it will be a long journey,like you said, so I definitely agree with you there.

But as with any type of exercise that doeshave a legislative component, that there ever were to be a legislative change or even aregulatory change or debate at royalty boards, just keeping that policy debate in play is, Often what spurs the industry is to sit downand come up with a private negotiated solution.

The fear that Congress or the government isgoing to take some action that will affect how that business is done is enough leveragethat it really, if it becomes serious enough, will bring the parties to the table and thatthey'll work that out on their own. Because let's face it, who is better to comeup with those solutions?

than the actual stakeholders that have theskin of the game that are going to be affected. So sometimes people introduce legislationjust to create that leverage, just to create that situation where they can sit down atthe table and really hammer out an answer. And sometimes you do need the law to comein and take a little bit.

a little piece from each of the parties andmake sure that there's a compromise that people can live with. In the case of the Music Modernization Actmost recently, about five years ago, that was the case. Everybody kind of came to the table. They put down ideas of what they wanted fromthe legislators. And then the legislators kind of hammeredout a little bit of pain for everybody.

Not everybody was perfectly happy at the endof that process, but they were happy enough that they had enough. benefit that it was worth it in the long run. Sometimes you don't even need to pass thelegislation to do that, depending on the country, depending on the circumstances, just gettingthe parties to the tables enough to achieve that in the marketplace.

Because that's one of the positives. I sort of followed on the sidelines with theMusic Modernization Act and David Israelite and him being very vocal about what he's doingand stuff. But because that's a positive thing that thingscan change. For the listeners, could you- describe to you what happened with that accident. What happened specifically with the firsttitle of that act with David Israelite?

Or just generally since there are three piecesof that act, but we talk mostly about the publishing side. Yeah, then you know a lot more than me. Like in the entirety of what happened, whatwas the positive change that happened? Yeah. Well, I think the biggest, look, as I said,everybody came to the table, the legislature said, we know that we need to modernize this. We know that we're not living in the digitalage.

What does everybody want? So everybody put their wish list on the table. And one of the biggest anchors that neededto hold that bill in place was the lack of the mechanical rights here in the United Statescoming up to speed with the digital age. Harry Fox organization was paying those rightsin the old days in the analog world.

And it just had not been duplicated to keepthat mechanical royalty for songwriters and publishers in the digital age. So the creation of the Mechanical Licensing Collective very akin to the creation of SoundExchange back in the DMCA. Everybody knew back in the DMCA that therewas going to be these digital rights that people deserved to get paid when their musicwas played and that kind of set the stage at that time, which created SoundExchangeultimately.

The same thing needed to be done for mechanicallicensing here in the United States with the MMA. So I'd say. When you look at the MMA, there's three titles. That title one that created the MLC, thatwas the bulk of the pages. There were some pages at the end that alsodid some wonderful thing. They created the right for producers to getpaid.

In law, that said if an artist wants to sharetheir royalties with producers, the producers are entitled to do that under federal law. The AMP Act, that was a big piece for producers,obviously. the two piece was in there as well, that pre-72recordings are entitled to payment regardless of when they were recorded.

So there were other parts of the MMA as well,but those that the mechanical licensing collected needed to exist in. If you look at what's happening with the MLCtoday around, you know, for the collections and distributions that they're doing aroundthe world, you know, they're distributing hundreds of billions of dollars that was beforethat not being recognized in the digital world.

But you're right. I mean, David is really made a lot of noiseabout it, but he, you know, we all, you know, all anybody with an interest in that gamewas very active. But what was really nice, and I'm sure you'veheard about this in the last five years, is that the industry really did all come togetherat the end of the day. You know, everybody kind of gave a littlebit of a pound of flesh, but then at the end of the day said, this is as best as we'regoing to get.

One of the concessions that sound exchangemade was, going to be a poison pill for this bill. And SoundExchange decided at the time to wait for another day to pass that terrestrial broadcasting piece that was not included in the MMA. We say it was left on the cutting room floor,because the legislators were like, look, we can get a lot of this done, but we can't getthat done.

We can't take on the broadcasters. So that compromises the art of success whenpeople really do decide that they you know, they needed to have legislationto create that organization and to write a couple of those other wrongs that were stillout there in the marketplace as well.

Jakob Wredstrøm (34:51.934)One of the underlying unspoken themes about everything we talk about right now is thelack of fairness towards the creators in general. I love the music industry, I love music, butI also really, really hate the devaluation of the art and the craft that people bringto the industry.

Like musicians, producers, songwriters, artistshave been working at the craft for many, many years and people really... get a lot from that. It's culture, it's art that's put out andit means something to people. But continuously, it's an industry where youwill be severely underpaid compared to the value you bring to humanity.

What's your viewpoint on that? Do you have any things that you use in orderto cope with that statement? Well, I couldn't agree with you more, Jacob. Like I said, I walked away from a very wonderful1450 company because I felt exactly that, that at the time we were debating SOPA herein the United States.

I don't know if you remember that, the StopOnline Piracy Act. And it was a very high profile debate wherebig Hollywood versus Silicon Valley. So the two of those big titans were comingto Washington in their private jets and limousines to talk to Congress about that. And I was working for one of those wonderfulcompanies. And I believed that, obviously, creators deserveto get paid.

What I saw was missing was the actual creatorsitting at that table. It didn't have a limo or a private jet toget to Capitol Hill with. And so that's why I took a pretty scary andbold step in my career to say, I'm going to dedicate the rest of my career to making surethat creators are represented and that their voice is heard.

And that was in 2013. How do we change that? Look, I'm trying to do it one student at atime at American University. I teach a class called protecting the creativeclass. And it's interesting, we started the classcalling it protecting the creative class. And then once we got into it for like thelast six or seven years, I was like, we don't need the word protecting.

They don't need to be protected. They just need to be championed, but theydon't need to be protected. I will say with the threat of AI coming ontothe scene, I actually think that the term protectingthe creative class is actually a fair game right now. We should probably stick with that title becausethere are some threats that are coming to the creative class through AI. We could talk about that if you want to.

But in terms of making sure that value ofthat craft and the importance to the world's economy, to the world's culture, to individualsanity that music gets from those creators. is so pivotally important. And I will leave this earth shouting fromthe hilltops that is the most important thing that needs to be valued fairly.

And people need to be compensated for thatwork and that artists should be able to do that work as a full-time job. They shouldn't have to be waiting tables orpumping gas or driving Ubers to the modern day equivalent to be able to. be an artist, that the systems should be setup with public funds, with private partnerships, where artists can do their work full time and practice their craft and make those contributions to society.

And like I said, if there are enough of usout there saying that, Jacob, we're on different continents. If we're both shouting it, hopefully we caninstill that. My hope is that... in some of my students that are entering themusic industry, that they'll go in knowing what a creator looks like, knowing what acreator sounds like, how a photographer makes their living, how a drummer makes their living.

And so educating the next generation, so whenthe next Modernization Act comes up and we're talking about these, that we're sure to representthose writers and performers are represented. I couldn't agree with you more. That's also one of the things that I reallywant to address over time is exactly that.

But one of the key things is over time isgoing to take time. Sometimes when I talk with my wife, I havethree kids and my oldest, he's only four, extremely musical, loves, loves music. You know, obviously being from music industry,I would love for him to be a producer or a singer. But then at the back of my mind, like, couldI even? allow him to do that.

Like when I know the stories, I know the struggles. And for me, that's kind of sad, right? Because this is an industry I love. I love the creation of music. And for my son, I wouldn't even wish uponhim that he would go through the struggle almost because I know the possibility, even though if he's incredibly talented, the possibility of him actually capitalizing on that.

is still small. And I think that's a sad fact. That's a really sad fact. Absolutely. And on the other end of the spectrum, whenyou're sending your kids to university, I just sent my youngest, you know, you're goingto have to help them think about that. And, you know, if they want to be a full-timemusician, I don't want to be a parent that has to say, you're going to need a plan B,you know, you're going to need to have another option up there.

You can't make music for a living. Like, it's great if you want to do it on theweekends. I want to be able to say to my kid, and Ihave said this to my kid, and we're fortunate enough you go for it. You become whatever you want to become becauseyou're talented and you got to try it. And then if you get sick of it and decideyou want to do something else, you can, but you shouldn't have to go in to start yourcareer by saying, oh, I've got to figure out something that's going to pay the bills.

It just shouldn't be that way. It wasn't that way for a long time. I am hopeful and very, very optimistic thatwith the right people involved and with the right voices saying this. we can create an equitable marketplace forcreators. But it's gonna be the creators that have tostand up and actually make those points.

The lawyers and the lobbyists can do theirpart, but it really will take the creators, the writers, the singers, the studio musiciansyou mentioned, they'll take everybody to really make sure that people know they are out thereand deserve to get paid fairly. It's gotten a lot better, Jacob. And that's what gives me hope. I feel like the pandemic was a really greateducation to spotlight this inequity that's out there, that the creators, you know, notonly could they not even make living where they could perform out, but when they hadto take that to do their own businesses on Zoom rooms and to really appeal to their fansto help support them.

I think the word is getting out that you needto have additional support because the... the current makeup of a lot of the systems is just not set up to create a full-time livelihood for creators. And I also feel like that's generally what'shappening in the industry. Like we need people attacking from all differentangles, if it's regulation or if it's platforms and fandom and sort of monetizations of thesuper fans.

They're all playing into the fact that noresponse. compensating for people's work. And that makes me more powdery than just. Like I want to be in an industry that looksvery attractive. That's sort of my mental thing.

I believe in 15 years, this is going to bea great place to be if everything goes right. And that's why also music entrepreneurshipin itself, you know, can, if you look at paper right now and you know, what's happening,what's happened the last 10 years, it's not necessarily attractive compared to other industries. Like if you want to be in entrepreneurialmusic industry, the valuations of the companies are lower.

The possibility of getting financing is harderand sort of the networking context for building companies is also poorer than many other industries. But I believe that will change within thenext 15 years. And I think that's the good you're doing andmany other industry players are doing is like what we are doing as an industry, the productwe are making music is inherently worth so much.

Now we just need to catch up a bit with actuallycompensating it accordingly. The enthusiasm that young people have todayis very different than when I was growing up, even when you were growing up, Jacob. They value what they purchase. For example, I know many young people thatwill go out of their way and spend more on a fair trade cup of coffee because they wantto be able to compensate that company for treating their workers right.

There's a value system. with young people today that I really believein my heart. And I agree with you. I think 15 years is a lofty goal, but I thinkwe can do it for people to value who made what they're enjoying and listening to, whetherit's a cup of coffee or whether it's music. I really, I know, and maybe these are just,you know, my students or my own children that, because they hear me screaming this for thelast 20 years, but you know, they value a songwriter.

And when you have a songwriter like TaylorSwift, who's out there kind of showing the worldthe importance of that craft and valuing that work. That will be the way that this can change. When the artists themselves stand up and makethose points and make it clear, like, look what you can do if you're a songwriter.

Taylor Swift started writing songs in herbedroom as well. And I do think that the young audiences today, will respect that and work to compensate that,whether it's through these individual patronage companies that are coming up. I think there's a great opportunity for theentrepreneurs out there to help get money from fans to artists and writers and everybodyin the creative chain that will begin to get that value out there.

And then as a terms of the systems that areset up, if you have the artists themselves at that want to protect their own craft and reallypromote those messages, they'll be well received. I have spent enough time and enough pairsof shoes walking Capitol Hill to tell you that they want to hear from the creators themselves. And that's happening. That's happening much, much more than it did,even when I left the corporate world 10 years ago.

Amazingly, that makes me hopeful and I thinkit was a really cool transition we made here from neighboring rights, which really stemsfrom, let's call it unfair payment, to fairness in general because we're both passionate aboutthe same industry. You're a few years ahead of me for doing goodwork. But we do need people like you and hopefullylike me in the future that really takes these steps towards having a better industry thatis more fair towards creators.

With that... Linda, thank you for being on the podcast. Thank you for giving valuable insights aboutneighboring rates, regulations, fairness, what's happening and what will happen in thefuture. Um, and I'm confident that even though I'mscared of my son going into the music industry, it will look a lot better when he's grownup than it did when you started an industry and when I started in the industry.

I sure hope you're right. And I'm willing to fight for the rest of mylife to make that possible for your son and for everybody coming up in the future. Yeah. Thank you, Linda. And thank you for being a son. Thank you, Jacob. Great job.