Cape Breton Post

U.S. keeping licensing decrees that help Spotify, others

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WASHINGTON — The U.S. Justice Department’s top antitrust official said on Friday the administra­tion will not scrap decades-old agreements with music licensing groups ASCAP and BMI that hold down costs for Spotify and others.

The department’s review of the matter had been closely watched since scrapping the 1941 consent agreements could upend the business of licensing music to online companies like Spotify and Pandora as well as movie companies, commercial­s, bars and restaurant­s.

Without the decrees, companies of any size seeking to play music would have to negotiate rights in a chaotic transition while also facing the prospect of price hikes, said the MIC Coalition, whose members include the Brewers Associatio­n and National Restaurant Associatio­n.

Makan Delrahim, the head of the Justice Department’s Antitrust Division who steps down next week, said in a speech that the “investigat­ion period” was closing.

“The ASCAP and BMI consent decrees should be reviewed every five years, to assess whether the decrees continue to achieve their objective to protect competitio­n and whether modificati­ons to the decrees are appropriat­e in light of changes in technology and the music industry,” Delrahim added in a speech to Vanderbilt Law School.

ASCAP and BMI said they were disappoint­ed by the government’s decision to formally close its review with no action taken. “The formal close of this review means we can put this matter behind us for the near future,” added ASCAP chief executive Elizabeth Matthews and BMI CEO Mike O’Neill in a joint statement.

The Digital Media Associatio­n, which represents Amazon.com Inc., Pandora and Spotify among others, welcomed the department’s decision to maintain the status quo, at least for now.

“Music licensing is complex, but throughout their existence the decrees’ protection­s have fostered an efficient marketplac­e that in turn has been critical to the resurgence and growth of the music industry,” said the group’s president, Garrett Levin, in a statement.

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