Compulsory License for Digital Music Providers

Looking into the Music Modernization Act (2018) in more detail, section by section (and here’s the first section) . . .

A brief summary of the important changes to copyright law effected by the Music Modernization Act can be found in a document prepared by the the office of one of the bill’s sponsors.

Under prior law, digital music providers (you know who they are) were not completely sure whether they had a legitimate compulsory license to distribute sound recordings digitally, in those situations when the sound recording may never have been distributed before under the authority of the musical work copyright owner. So, Section 115 of Title 17 U.S. Code, was amended by the Music Modernization Act to include the following language:
‘‘(ii) in the case of a digital music provider seeking
to make and distribute digital phonorecord deliveries
of a sound recording embodying a musical work under
a compulsory license for which clause (i) does not
apply—
‘‘(I) the first fixation of such sound recording
was made under the authority of the musical work
copyright owner, and the sound recording copyright
owner has the authority of the musical work
copyright owner to make and distribute digital
phonorecord deliveries embodying such work to
the public in the United States; and
‘‘(II) the sound recording copyright owner, or
the authorized distributor of the sound recording
copyright owner, has authorized the digital music
provider to make and distribute digital phonorecord
deliveries of the sound recording to the
public in the United States.

Thus, a digital music provider may obtain a compulsory license to be the first person to distribute a sound recording, so long as the following conditions apply: (1) the musical work copyright owner (i.e., songwriter and publisher) authorized the sound recording to be made and distributed, and (2) the sound recording copyright owner (i.e., the record company) has authorized the digital music provider to make and distribute digital deliveries of the sound recordings.

All well and good. The digital music services still have to be permitted by the record company/sound recording rights holder to include a sound recording in the digital music services. One would think that there are still some independents out there who do not want their songs and sound recordings included in one or all of the digital music services.