Makan Delrahim

While Congress subpoenas the Attorney General and a Facebook co-founder argues the company should be broken into thirds, the Department of Justice is also considering regulatory changes that would affect competitiveness in dozens of markets. Makan Delrahim, head of the Department of Justice’s antitrust division, announced last year that the DOJ had begun reviewing the consent decrees it entered with ASCAP and BMI in 1941. “As public agencies we need to take a look and see if these consent decrees are still relevant in the marketplace,” he said at Vanderbilt Law School in 2018.

Any business where live music is performed must pay songwriters and publishers, mainly through performance rights organizations ASCAP and BMI. Businesses such as concert venues acquire blanket licenses from ASCAP and BMI for the performances of the millions of musical works in their catalogs. Delrahim is leading a review of all DOJ consent decrees to assess if technological changes have eroded a market’s competitiveness. 

“We will begin sunsetting some of them that don’t make a lot of sense,” he said. In a 2017 speech, Delrahim expounded a hands-off approach to antitrust that lets “competition police markets instead of bureaucrats in Washington, D.C.” He expects “to cut back on the number of longterm consent decrees we have in place” in favor of “structural remedies” such as divestitures. 

The performing rights business is hardly a market that polices itself. The consent decrees requires the two organizations, which command about 90 percent of the market, to grant all requests for licenses. So, for example, the PROs license their repertoire at rates that take into account the type and size of the business. All types of companies, from a small coffee shop to Madison Square Garden, pay for a blanket license that covers everything in ASCAP and BMI’s catalog. A company can negotiate with a PRO, however, but an impasse sends the parties into court; a judge then hears the case and sets the licensee’s rates. 

Conflicts over interpretations of the consent decrees continue to this day. In 2017, BMI won its lawsuit against the DOJ over the latter’s decision to allow for “full-works” licensing. The longstanding practice was to acquire separate licenses when a musical work had multiple songwriters represented by different PROs. In addition, in 2015, publishers lost their bid to withdraw their licenses from digital service providers in order to strike direct deals. The attempt was rebuffed when two judges told publishers they must allow ASCAP and BMI to license their full catalogs or withdraw from all licensees. 

Delrahim has not signaled opinions on either matter, but a change to the consent decrees would change who gets paid, how they get paid and how much they get paid.

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