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27 July 2020
With the rise of social distancing and stay-at-home orders, the demand for online content has increased exponentially. Given this new reality, online content creators must take steps to ensure that their online creations do not land them in legal hot water. One of the most prevalent cross-industry issues is music licensing. Music often plays an integral part in the overall experience of online content. From video game players streaming music as they show off their skills on the largest video platforms to fitness instructors using popular music to pump up their workout classes, individuals and companies must ensure that they avoid running afoul of copyright laws when they incorporate music into their online content.
Copyright owners are granted an exclusive bundle of rights in relation to their copyrighted works, including the exclusive rights to reproduce, publicly perform and distribute their copyrighted works.(1) Music copyright is broken down into two separate rights: one for the music's composition (ie, music and lyrics) and one for the actual sound recording (ie, a fixed performance). Because of these dual rights, using copyrighted music may require two different licences.
To release a video with a song that someone else wrote and composed requires a synchronisation (sync) licence. For example, if a band releases a video of themselves playing an Incubus song, they need a sync licence to use the music and lyrics of that song, even if it is a small portion of the song. The band would not require a sync licence to use songs that they wrote and composed themselves or songs in the public domain (eg, the song "Danny Boy" may be freely used in a YouTube video). However, the use of a copyrighted sound recording in a video requires a sync licence for the composition and a master use licence for the original recording. Again, this applies even if a small portion of the original sound recording is used. Master use licences are negotiated with a song's owner – typically, a record label or recording artist. Sync and master use licences are separate and distinct from public performance and personal entertainment licences (for further details please see "Conducting your way through music licensing: common issues"). The following examples and best practices illustrate and address the challenges associated with using music in online content.
Video game players who livestream or record their gameplay often include music with that content. Livestreaming and online video platforms such as Twitch and YouTube regularly host gamers streaming music while playing the most popular video games. Gamers often use popular music-streaming subscription services to do this, but those services are intended for personal entertainment, not broadcasting. Streaming platforms allow gamers to record and upload those livestreams as video on demand (VOD). However, platforms will mute VODs for unauthorised use of copyrighted audio. This is known as 'VOD muting' and protects the online platforms, not streamers. Even if a VOD contains no third-party music, it could be muted for in-game music. Without the right licences, syncing copyrighted music with live or VOD content may lead to liability for copyright infringement. However, gamers are not the only ones struggling with how to incorporate music into their production without violating copyright laws.
Gym closures have led personal fitness trainers, yoga instructors and group exercise leaders to move their content from their studios to YouTube and other streaming sites. However, even individual instructors must ensure that they have the proper licences to use music to pump up their online workouts. Instructors have found creative ways to avoid the costs associated with obtaining sync and master use licences. For example, some instructors provide a suggested playlist from a streaming service beforehand that class members can access on their own or use public domain versions of songs that sound relatively similar to the popular songs that they wish to use. Others simply opt not to use music at all in their videos. Larger fitness companies that have procured the proper licences for their in-studio use of songs still must ensure that their instructors teaching from their living rooms have licences as well.
Peloton, a fitness company known for its stationary exercise bikes and treadmills that stream live and VOD classes led by instructors, was sued for allegedly using thousands of unlicensed songs in its popular workout videos. Nine music publishers, all members of the National Music Publishers' Association (NMPA), filed a lawsuit in March 2019 alleging that Peloton had used more than 1,000 unlicensed songs in its workout videos and seeking more than $150 million in damages.(2) The plaintiffs later amended their complaint to add 1,000 more musical works and increased their damages demand to $300 million.
The complaint alleged that Peloton knowingly and wilfully infringed the plaintiffs' copyrights because Peloton failed to obtain the proper sync licences for several songs featured in its online classes. The complaint had an immediate impact on the platform, as shortly after the lawsuit was filed, Peloton removed the offending songs. Peloton's response sparked a separate class action litigation brought by several Peloton customers alleging that the removal of the infringing music had caused 5,739 classes to be taken off the platform in their entirety, which significantly reduced the size of the on-demand library available to users and the quality of the platform in general.
On 27 February 2020 Peloton and the NMPA announced that they have fully settled the litigation. Although the financial terms of the settlement were not disclosed, Peloton and the NMPA entered into a "joint collaboration and will work together to further optimize Peloton's music-licensing systems and processes".
Streaming platforms are finding ways to educate content creators in these industries and others to discourage copyright infringement. For example, YouTube has developed educational content dedicated to assisting content creators with the legal use of music on their website. Its Creator Academy includes instructions relating to music copyright and constructive solutions to finding ways to include music in that content. YouTube also polices the use of copyrighted music with a so-called 'strike programme'. After YouTube reviewers deem a complaint valid, the creator of the alleged infringing content must enrol in its 'Copyright School' – a five-minute video explaining YouTube's policies, with a quiz to confirm understanding. After three strikes, YouTube will remove the account.
Content creators who cannot obtain the proper licences to use the most popular music have another option. Several online platforms offer stream-safe, royalty-free music specifically for live streamers such as gamers and fitness instructors. For example, PretzelAux (Pretzel) has curated a library of new music that allows streamers to avoid VOD muting and copyright claims. Artists who upload their music to Pretzel have agreed to permit users to play their music in streaming content. Pretzel offers both a free and a paid subscription.
Although the current public health crisis has certainly led to more online content, these music streaming challenges already existed. Content creators must ensure that they have the appropriate licences for music in their videos, while video streaming platforms must assist in policing the content they support.
For further information on this topic please contact Calvin R Nelson, Katherine C Dearing or Nicholas W Jordan at Venable LLP by telephone (+1 410 244 7400) or email (email@example.com, firstname.lastname@example.org or email@example.com). The Venable LLP website can be accessed at www.venable.com.
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