In comments filed today, EFF joined with other public interest and consumer groups in urging the Copyright Office to clarify the process for licensing digital music services, but to steer clear of larger digital copyright controversies. The comments were filed in a rulemaking involving the Section 115 compulsory license for "digital phonorecord deliveries" (DPDs) that has been dragging on since 2001 (read the July 16, 2008 "notice of proposed rulemaking" for a summary of the tortured history of the proceeding).
The issues are fantastically complex (even most copyright experts are perplexed by the morass surrounding digital music licensing), but the current logjam boils down to music publishers against everyone else. Every music recording involves two copyrights: one for the sound recording (i.e., the "master"), which is usually controlled by a record label, and one for the musical work (i.e., the "composition"), which is usually controlled by a music publisher. Different music services need different sorts of licenses (and those that simply host materials uploaded by users or simply distribute software may need no license at all), and it has been notoriously complicated to figure out who to contact for the relevant licenses.
The licensing of sound recordings has been getting easier, not least because the four major labels cover so much of the waterfront, and because licensing aggregators are consolidating the independent labels. It's the music publishers that represent the last great obstacle to streamlined licensing, in large part because there are so many of them. The good news here is that Congress in 1995 created a compulsory license in Section 115 of the Copyright Act, which means that so long as you pay a set rate, you can get a license to any and all musical works that you need. The bad news is that the interpretation of what the compulsory license covers, as well as the rate setting, has been trapped in regulatory limbo for years, creating uncertainty for everyone.
The Copyright Office has been trying to break the logjam with respect to digital music services by issuing regulations clarifying the scope of the DPD compulsory license. In particular, the Copyright Office is aiming to cut through some of the complexity by saying that the compulsory license is broad enough to cover any and all copies (whether server-side or client-side, whether on a hard drive or in a RAM buffer) made in the course of any kind of digital music service (whether downloading, streaming, or time-limited subscription).
So far, so good. The DPD compulsory license was created by Congress to prevent music services from having to find and negotiate one-by-one with every music publisher for every song. If some incidental copy is left hanging outside the 115 license, that goal would be frustrated.
But, as discussed in the EFF comments, the Copyright Office's proposal goes a bit too far by trying to resolve a number of other, unnecessary, copyright controversies that should be resolved by the courts or Congress. In particular, the proposed regulations took the position that temporary RAM buffer copies made in the course of streaming should qualify as copies under copyright law, precisely the issue that the Cablevision DVR opinion decided the other way just a few weeks ago. The proposed regulations also unnecessarily weigh in on the question of whether the distribution right reaches digital transmissions, an issue EFF has addressed in several court cases.
There is no need for the Copyright Office to get entangled in these continuing controversies in order to clarify the DPD compulsory license. It is enough for the regulations to clarify that all of the activities of digital music services can be licensed under the compulsory license, without coming to any conclusions about whether any particular activities must be licensed. Rather than issuing broad statements that will only spawn more litigation, the Copyright Office should stay out of these extraneous controversies and focus instead on clarifying the Section 115 compulsory license.