Digitization Can Lead to More Competition in Music Licensing

Digitization Can Lead to More Competition in Music Licensing

Lenard, White Published in UCLA Entertainment Law Review

March 31, 2017 – Digitization has made the music licensing market more conducive to direct negotiation between users and license holders, explain Thomas Lenard and Lawrence White in “Moving Music Licensing into the Digital Era: More Competition and Less Regulation,” published UCLA Entertainment Law Review journal. The article is an expanded and updated version of the paper of the same title previously published by TPI.

In the article, Lenard, Technology Policy Institute Senior Fellow and President Emeritus, and White, Professor of Economics at the NYU Stern School of Business, observe that the current licensing system, created during the analog era, is based on a handful of regulated performing rights organizations as opposed to market forces. While this was necessary in the past to minimize transaction costs, changes in the way music is consumed and distributed have created an opportunity for music licensing reform.

Key to Lenard and White’s policy suggestions is the development of a comprehensive database of musical compositions and their owners so that users can readily identify from whom they need to license rights. This would greatly facilitate a more competitive music licensing regime, characterized by greater ability of intermediaries to aggregate the various categories of music ownership rights and more direct negotiations and transactions between music rights holders and music distributors.

Moving Music Licensing into the Digital Era: More Competition and Less Regulation” is available on the TPI website.  The full issue of the UCLA Law Journal is available here.

Contact: Amy Smorodin, 202-828-4405,
[email protected]

The Technology Policy Institute

The Technology Policy Institute is a non-profit research and educational organization that focuses on the economics of innovation, technological change, and related regulation in the United States and around the world. More information is available at https://techpolicyinstitute.org/.

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