The American Association of Independent Music (A2IM), which advocates for independent labels, along with 10 other music industry groups, has penned an open letter to the US Copyright Office that pushes back on the Office’s proposed 43% average rate hike for copyright registration — noting that it would hurt working-class artists and small music businesses most. The letter also notes that the proposed hike comes at a time when the use of generative AI is rapidly expanding, adding that cost-prohibitive prices for copyright registration could leave less privileged artists’ rights to their work vulnerable.
The Copyright Office’s proposal, released in March, would raise the fee for registering copyrights from $65 to $130. “The most fundamental flaw in the Office’s cost-recovery rationale is its implicit assumption that copyright registrants can absorb or pass through fee increases as a cost of doing business,” reads the music coalition’s letter. “For the working creators and independent businesses our organizations represent, that assumption does not hold.”
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The letter adds that the primary income streams for independent talent are “not set by the creators themselves[,] they are set by others” — like the Copyright Royalty Board, collective licensing structures or free market negotiations that give indie rights holders “limited leverage.”
Groups co-signing the letter with A2IM includ those representing the interests of composers, songwriters, record labels, artists and professional live musicians. This includes the Alliance for Women Film Composers, Artist Rights Alliance, Music Managers Forum-US (MMF-US), the Recording Academy, the Society of Composers & Lyricists (SCL), Songwriters of North America (SONA), Songwriters Guild of America (SGA), Music Artists Coalition (MAC), American Federation of Musicians (AFM) and the Future of Music Coalition.
The Copyright Office noted that its rationale for the newly proposed rate hike is to keep up with “projected inflation” and “actual to-date cost increases.”
“The Office’s goal is to restore recovery of the historically higher percentage of its actual expenses from fees in order to support its operations and provide high quality services to the public,” the proposed rule reads. “The fees proposed here fall far short of covering the Office’s actual costs, [but] we recognize that some of the increases are substantial and may impact some copyright stakeholders more than others.”
The Office last adjusted fees in 2020. The timing of the March proposal is a little behind schedule when it comes to the Office’s typical rate recalibration cycle, which takes place about every 3 to 5 years.
Registering copyrights is technically voluntary in the U.S., but as the A2IM letter notes, “it is a practical prerequisite for the enforcement mechanisms that make copyright meaningful.” Already, due to costs of registration, A2IM found in a recent survey of its members that “fewer than a third of respondents had registered more than 75% of their catalog and cost was the most frequently cited barrier.” It also found that “multiple labels reported that they limit registration to their highest-value works or have stopped registering certain categories of works altogether because the per-registration economics do not justify the expense at their scale.”
The letter adds that the Office should consider the “broader legislative context in which this fee proposal arrives,” noting that AI is growing and Congress is constructing AI transparency mechanisms, which are only helpful for copyright holders with registered works. “We are concerned that, if that bill were enacted, every independent creator priced out of registration by a fee increase would be a creator who cannot meaningfully participate in the enforcement framework Congress is building in an era of extreme uncertainty given Generative AI,” it continues.
While the music groups write that the Copyright Office must strike a “difficult balance…between cost recovery and the participation objective in the copyright system,” they believe the proposal “does not strike that balance correctly.”
“We urge the Office to reconsider the magnitude and distribution of the proposed increases, to give meaningful weight to the incentive function of registration,” the letter adds.
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