Streaming mechanical royalties currently create significant challenges for songwriters in the music industry. Here's a comprehensive analysis of the issues and potential solutions.

The Current Problem:

• Songwriters suffer disproportionately under the current streaming licensing system
• Song rights revenue is capped at 20% of streaming revenue
• Major publishers control 70% of revenue-earning songs but are protected by label relationships
• Direct licensing of mechanicals is impractical and potentially harmful

Two Proposed Solutions:

1. Eliminate Streaming Mechanical Royalties

• Classify streaming solely as a "public performance" right
• Transfer all licensing to PROs (ASCAP, BMI, SESAC)
• Enable direct payment flow to songwriters
• Remove complexity of Section 115 compulsory licensing
• Streamline collection and distribution processes

2. Implement Unified Rate Setting

• Create single arbitration process for all stakeholders
• Follow app store revenue model
• Platform takes fixed percentage
• Content owners split remaining revenue
• Use federal copyright tribunal for oversight
• Require ASCAP and BMI to represent songwriter interests

Benefits of Reform:

• Simplified licensing process
• Direct payments to songwriters
• More equitable revenue distribution
• Reduced administrative costs
• Better representation for songwriters

Challenges to Implementation:

• Publisher resistance to change
• Complex legislative requirements
• Need for stronger songwriter advocacy
• Industry stakeholder coordination
• Existing contractual obligations

The streaming mechanical system needs significant reform to better serve songwriters. Both proposed solutions emphasize the crucial role of PROs and the need for more equitable revenue distribution in the digital streaming era.

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