Entertainment Licensing Challenges

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Entertainment Licensing Challenges - Movies/Film

Three copyright challenges that the entertainment industry faces regarding movies and film are public performance and the interpretable line between copyright infringement and fair use, companies that attempt to circumvent copyright laws with claims that have not been clearly defined, and the unauthorized use of streaming services.

Public Performance and Fair Use

  • As defined in copyright law, a public performance of work is a display in the open or in public where a substantial amount of individuals are or to transmit a performance or display of work utilizing any device whether the members of the public receive it in the same place at the same time or in separate places at different times.
  • Bars, restaurants, private clubs, prisons, factories, public libraries, churches, and non-classroom use at schools and universities are examples of where a public performance license must be obtained regardless of admission fees, federal or state agency involvement, or profit or nonprofit standing.
  • The copyright exception Fair Use, which allows the use of copyrighted work without a license in the aforementioned places, involves four factors: whether the use is for educational purposes, the nature of the copyrighted work, the amount of the work that is being used, and the market value of the work.
  • The issue that arises with this exception is the frustration that comes with the formula determining whether a use is “fair,” and because it is open to interpretation, unless the user is sued, it’s difficult to know if they’re breaking the law or not and even if it is taken to court, it’s based on the ruling judge’s interpretation of the law.
  • Although one of the factors to establish fair use is whether the copyrighted material is used for commercial gain; however, although an example is the use of copyrighted material in the creation of video essays, many are obtaining millions of views and thousands of dollars from essay videos posted on social media platforms without revoking their fair use status.

Process of Defining Cable Systems

  • The Copyright Act of 1976 only had traditional cable systems in mind at the time of establishment, leaving Internet-based services able to claim certain loopholes and force the courts to be ever-changing the way it is defined.
  • In 2012, the company Aereo tried assigning subscribers individual antennas to avoid comparisons with a cable service and to avoid having to obtain permissions; however, the Supreme Court ruled they were infringing copyright without a license.
  • In 2016, the court battle against FilmOn initiated companies providing film and television content over the internet being defined as a “cable system.”

Streaming Services

  • The Global Innovation Policy Center has estimated that global online piracy costs the United States economy roughly $29.2 billion in lost revenue every year.
  • A common argument regarding unlicensed streaming and its violation to copyright law is that streams do create copies of the work because of progressive download, or a method of streaming video that allows users to view the content as soon as a small amount arrives, but so far this has not held up in court as it does not fit in the law's definition of a copy.
  • The ability to steal large amounts of copyrighted works can be easily done with only an additional cable or satellite line and a streaming service, allowing a user to capture programs or internet streams and re-transmit them over the Internet.
  • Because of peer-to-peer technology, which allows users to create and share video streams with a central server being replaced with Cloud computing services, user-generated content sites are often misused by sharing copyrighted content without permission of the owner.
  • Streaming can infringe on multiple protected rights such as public performance, reproduction, and, in some cases, distribution.
  • While downloading and distributing unauthorized content is a felony, streaming the content without permission is only a misdemeanor because today’s technology evolves faster than copyright laws can.
  • VidAngel, a subscription service that allowed users to edit nudity, profanity, sexual content, and violence out of Hollywood films were accused of infringing on copyright laws regarding streaming entertainment without authorization. The argument was that the Family Movie Act of 2005 did not protect VidAngels movies because they were not authorized by the studio that owned the copyright.




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Entertainment Licensing Challenges - Television

Three key copyright challenges that the television Entertainment Licensing Industry faces include; litigation due to copyright documentation mistakes, lack of clarity for unscripted television programming copyrighting and substantiating similarity during copyrighting.

#1 LITIGATION DUE TO COPYRIGHT DOCUMENTATION MISTAKES

  • The mistake of stating that a given film or television work is a derivative when it is not is most likely to cause ownership issues by the production company. This boils down to issues of distribution of the program and questionable sole ownership. This loophole can result in expensive litigation by the company.
  • When screenplay rights are not clearly defined and noted in an agreement, legal issues may arise between the writers or co-writers and the production company.
  • Licensing of music used in television programs and films may be complicated and expensive. It is recommended a lawyer be involved to determine the best pricing and 'clear' the music before use. If not done correctly, it may cost the company dearly.

#2 LACK OF CLARITY FOR UNSCRIPTED TELEVISION PROGRAMMING COPYRIGHTING

  • Unscripted television programming also referred to as reality shows, faces a format issue when carrying out their copyrighting. As a result, there has been a number of cases related to the copyrighting of reality shows.
  • Although they are defined as unscripted, reality shows do not clearly define the elements of consideration during a copyright case. This lack of clarity makes them subject to copyright manipulation with a particular target on their format. This is unlike the scripted programs that use images, words or scripts as elements of consideration during copyright litigation.
  • An example is a case between CBS and ABC in November 2002, whereby CBS claimed that the reality show 'I'm A Celebrity... Get Me Out of Here!' by ABC had infringed its 'Survivor' show's rights. However, their motion to stop ABC from airing their show was denied due to unclear similarity in both shows' elements.

#3 SUBSTANTIATING SIMILARITY DURING COPYRIGHTING

  • In order to perform accurate licensing in television, all circumstantial or direct information must be aligned to establish any similarity with any other existing works. This is not always an easy process and many companies become victims of infringement.
  • First, it should be noted that ideas are not usually protected by copyright, and only qualify for protection after they are expresses.
  • Second, although ideas are protected on expression, if the idea has limited ways of expression then it is not fully protected by copyright; only against identical copying.
  • Finally, characters, stock scenes and settings apply the same copyrighting conditions one and two listed above. This is referred to as scènes à faire. For example, the court concluded in the case between producers of the films Jurassic Park and Dinosaur World, that there was no similarity in the copyrighted expression, even with the common element of a dinosaur.
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Entertainment Licensing Challenges - Music

Three copyright challenges facing the entertainment licensing industry specific to music are that music recorded before 1972 is not protected by federal law, the fact that AM/FM radio stations do not pay performance royalties on sound recordings while digital services do, and that major recording artists are being sued for copyright infringement of unoriginal musical patterns. Details of these challenges are below.

Pre-1972 Music

  • Current federal copyright laws do not apply to music recorded before 1972, which means that only state laws, if there are any, cover these artists.
  • This problem means that to use any music that was recorded prior to 1972, digital services like Pandora and Sirius XM have to negotiate directly with the rights holders, which can be a complicated process.
  • Often, digital radio services didn't bother trying to obtain permission to play pre-1972 music, which led to a variety of lawsuits in different states. Inevitably, these lawsuits produced different results and further complicated the process.
  • The CLASSICS Act (Compensating Legacy Artists for their Songs, Service and Important Contributions to Society), is currently under consideration at the federal level, which will "require digital radio services to pay royalties on those recordings" and will make the process for permission simpler by applying the statutory royalty rate.
  • This will change the industry in that digital radio services will no longer be able to play pre-1972 music without paying royalties to the rights holders and will create an easier path for those rights holders to get paid.

AM/FM Radios and Performance Royalties on Sound Recordings

  • Currently, AM/FM radio stations only pay performance royalties on musical compositions, but digital radio services are required to pay performance royalties on both musical compositions and sound recordings.
  • When digital services were new, they needed to pay for sound recordings so they could attract audiences, but now that they are as popular (or even more popular) as AM/FM radio, digital services are arguing that the playing field is not fair.
  • The Fair Play Fair Pay Act is making its way through Congress and will require AM/FM radio stations to pay performance royalties for sound recordings.
  • Some stakeholders are worried that this new law would negatively impact small radio stations in rural communities even though "stations with less than $1 million in annual revenue [are exempt] from providing feeds of music play data and paying royalties." Small stations will only pay a $500 flat annual fee.
  • This bill will change the industry in that AM/FM radio stations will be required to pay more to get the rights to play music than they have had to pay for decades.

What Constitutes Copyright Infringement?

  • A major problem in the music industry that is popping up on lawsuits across the country is allegations of copyright infringement; however, it is unclear what is actually infringement and what could be considered inspiration.
  • For instance, Katy Perry was sued by the rapper, Flame for using "a three-note, four-beat 'ostinato' consisting of the pattern C-C-C-C-B-B-B-B-A" in her song "Dark Horse." Flame alleged that this pattern was taken from his rap, "Joyful Noise."
  • This pattern, though, is found in numerous songs that have been written throughout history and is not truly original. A jury, though, awarded Flame $2.8 million in damages with the verdict that Perry did infringe on his copyright.
  • The issue here is that what is considered "original" in music has not been established like it has for phrases. For example, "copyright laws would never protect unoriginal three-word phrases such as 'Call Your Mom,' 'Now or Never,' or 'Let it Go'," but the laws are protecting the musical equivalent of these phrases.
  • Additionally, existing songs often serve as inspiration for new songs and this has been an American tradition for centuries. Classical music is full of examples of one song influencing another, but in today's climate, jury verdicts such as the one for Perry set up the scenario where some musicians will "use small, unoriginal music ideas and leverage those against much bigger musicians with much deeper pockets."
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