WEBVTT 00:00:00.000 --> 00:00:03.500 So imagine a local jazz band playing a cover 00:00:03.500 --> 00:00:06.679 of the song Memory, you know, from the musical 00:00:06.679 --> 00:00:08.720 Cats. Oh, yeah, classic. Right. And they're just 00:00:08.720 --> 00:00:10.279 playing it in a crowded coffee shop. I mean, 00:00:10.419 --> 00:00:12.419 nobody blinks an eye. It literally happens every 00:00:12.419 --> 00:00:14.480 single day. Yeah, completely normal. But now 00:00:14.480 --> 00:00:17.699 imagine a high school theater troupe singing 00:00:17.699 --> 00:00:21.589 that exact same song. like on a stage, under 00:00:21.589 --> 00:00:24.649 a single spotlight, maybe wearing cat ears. Okay, 00:00:24.789 --> 00:00:26.929 yeah, that completely changes things. Exactly. 00:00:27.149 --> 00:00:30.989 Suddenly, they have crossed this invisible legal 00:00:30.989 --> 00:00:33.929 trick wire that could theoretically shut down 00:00:33.929 --> 00:00:35.850 their entire production. Right, because the music 00:00:35.850 --> 00:00:38.310 is identical. I mean, the notes are exactly the 00:00:38.310 --> 00:00:40.929 same. But the context has completely shifted. 00:00:41.789 --> 00:00:44.609 And in the eyes of the law, that shift changes 00:00:44.609 --> 00:00:47.369 everything about who gets paid. how they get 00:00:47.369 --> 00:00:49.850 paid, and who actually has the power to say no. 00:00:49.950 --> 00:00:51.990 Okay, let's unpack this, because today we are 00:00:51.990 --> 00:00:56.710 taking a deep dive into a highly specific, fiercely 00:00:56.710 --> 00:00:59.570 guarded area of copyright law known as grand 00:00:59.570 --> 00:01:02.460 rights. Fascinating topic. It really is. We're 00:01:02.460 --> 00:01:04.780 using a really comprehensive Wikipedia entry 00:01:04.780 --> 00:01:07.079 as our source material today. And our mission 00:01:07.079 --> 00:01:11.260 here is to decode the invisible red tape behind 00:01:11.260 --> 00:01:13.859 the music we experience in theaters, dance halls, 00:01:14.159 --> 00:01:16.120 and, you know, on stage. Right, because most 00:01:16.120 --> 00:01:18.680 of us just, well, we buy a ticket, take our seat, 00:01:18.799 --> 00:01:20.939 and just let the magic wash over us. Yeah, we 00:01:20.939 --> 00:01:23.349 don't think about the paperwork. But there is 00:01:23.349 --> 00:01:26.849 this secret legal framework dictating where and 00:01:26.849 --> 00:01:29.290 how we hear that music. And I think, you know, 00:01:29.290 --> 00:01:31.209 when people think about music copyright today, 00:01:31.590 --> 00:01:34.090 the conversation is usually dominated by, like, 00:01:34.370 --> 00:01:36.769 streaming payouts or digital piracy. For sure. 00:01:36.930 --> 00:01:39.109 Spotify, fractions of a penny, all that. Exactly. 00:01:39.450 --> 00:01:41.530 But the distinction around grand rights opens 00:01:41.530 --> 00:01:43.829 up a completely different conversation. I mean, 00:01:43.890 --> 00:01:45.989 this isn't just a technicality in a contract. 00:01:46.069 --> 00:01:48.989 No. It is a fundamental story about economic 00:01:48.989 --> 00:01:53.040 leverage. human nature, and the extreme lengths 00:01:53.040 --> 00:01:56.219 to which creators and publishers will go to protect 00:01:56.219 --> 00:01:58.840 their most context -specific creations. Totally. 00:01:58.840 --> 00:02:00.840 And I promise you, by the time we finish this 00:02:00.840 --> 00:02:03.299 deep dive, you will never look at a local dance 00:02:03.299 --> 00:02:06.340 recital, a ballet, or a massive Broadway production 00:02:06.340 --> 00:02:09.599 the exact same way again. You really won't. So, 00:02:09.919 --> 00:02:12.560 to even understand what makes a grand write so 00:02:12.560 --> 00:02:16.180 special, we first have to figure out how normal 00:02:16.180 --> 00:02:19.370 everyday music is licensed. We need to... to 00:02:19.370 --> 00:02:22.449 establish the baseline. And looking at the source 00:02:22.449 --> 00:02:25.270 material, it seems the music industry has essentially 00:02:25.270 --> 00:02:27.949 divided the world into three completely separate 00:02:27.949 --> 00:02:31.710 silos, right? Small rights, sync rights, and 00:02:31.710 --> 00:02:33.530 grand rights. Yeah, that's the basic breakdown. 00:02:33.810 --> 00:02:36.370 Let's start with the baseline. What exactly is 00:02:36.370 --> 00:02:39.810 a small right? So small rights cover the non 00:02:39.810 --> 00:02:43.069 -dramatic use of a musical composition. And these 00:02:43.069 --> 00:02:46.949 are managed by organizations known as PROs, performance 00:02:46.949 --> 00:02:49.990 rights organizations. Like Ace Cap and BMI. Exactly. 00:02:50.330 --> 00:02:52.370 The major ones you might see on a little sticker 00:02:52.370 --> 00:02:55.189 in a restaurant window. When a song is just functioning 00:02:55.189 --> 00:02:58.030 as a piece of standalone audio, that is a small 00:02:58.030 --> 00:03:00.990 right. OK. So the pop song on the radio, the 00:03:00.990 --> 00:03:04.090 background music at the gym, or that jazz band 00:03:04.090 --> 00:03:05.770 playing in the coffee shop we talked about earlier. 00:03:05.849 --> 00:03:08.110 Right. So the PROs essentially function like 00:03:08.110 --> 00:03:09.969 an all -you -can -eat buffet. That's a good way 00:03:09.969 --> 00:03:12.719 to put it. Yeah, like a coffee shop owner doesn't 00:03:12.719 --> 00:03:15.060 call up Taylor Swift's manager every time her 00:03:15.060 --> 00:03:17.319 song plays on their Spotify playlist. That would 00:03:17.319 --> 00:03:20.020 be a nightmare. A total nightmare. The coffee 00:03:20.020 --> 00:03:22.719 shop just pays a flat blanket fee at the door 00:03:22.719 --> 00:03:26.280 to Ace Cap or BMI. And in exchange, they get 00:03:26.280 --> 00:03:29.419 access to this massive buffet of millions of 00:03:29.419 --> 00:03:31.379 songs to play in the background. It's a volume 00:03:31.379 --> 00:03:34.280 game. The buffet analogy captures the mechanism 00:03:34.280 --> 00:03:37.539 perfectly. It is a blanket license for access 00:03:37.539 --> 00:03:41.159 to a massive pool of non -dramatic music. Now, 00:03:41.639 --> 00:03:45.139 contrast that with the second silo, sync licensing. 00:03:45.580 --> 00:03:48.219 Sync is short for synchronization. This applies 00:03:48.219 --> 00:03:50.460 when you want to take a piece of music and permanently 00:03:50.460 --> 00:03:52.870 attach it to visual content. Like putting a classic 00:03:52.870 --> 00:03:55.689 rock anthem over a car commercial. Yes, or a 00:03:55.689 --> 00:03:57.949 somber indie track playing during the emotional 00:03:57.949 --> 00:04:00.610 climax of a television show. Oh, or like a video 00:04:00.610 --> 00:04:02.930 game opening sequence. Exactly. The key difference 00:04:02.930 --> 00:04:05.629 here is permanence and medium. With a small write, 00:04:05.909 --> 00:04:08.129 the music is fleeting. I mean, it plays in the 00:04:08.129 --> 00:04:09.669 coffee shop and then it's just gone into the 00:04:09.669 --> 00:04:11.669 ether. Right, it's temporary. But with a sync 00:04:11.669 --> 00:04:15.110 license, you are inextricably linking that audio 00:04:15.110 --> 00:04:18.439 to a fixed visual medium. You are fundamentally 00:04:18.439 --> 00:04:21.139 changing how the audience will forever associate 00:04:21.139 --> 00:04:24.040 that song. Oh, wow because of that You can't 00:04:24.040 --> 00:04:26.480 just use the PRO buffet. You have to negotiate 00:04:26.480 --> 00:04:30.000 async license directly. OK. Which brings us to 00:04:30.000 --> 00:04:32.800 the third silo, right? The star of today's deep 00:04:32.800 --> 00:04:37.100 dive, grand rights. Yes, the grand rights. So 00:04:37.100 --> 00:04:39.540 the material defines a grand right as the specific 00:04:39.540 --> 00:04:42.379 licensing required to perform a musical composition 00:04:42.379 --> 00:04:45.759 within the context of a dramatic work. And it 00:04:45.759 --> 00:04:47.420 explicitly lists things like musical theater, 00:04:47.759 --> 00:04:50.220 concert dance, and arrangements of music that 00:04:50.220 --> 00:04:52.680 originally came from a dramatic work. Right. 00:04:52.860 --> 00:04:56.279 And here is the massive catch. The big PROs, 00:04:56.339 --> 00:04:59.519 the ASCAPs and BMIs of the world, they are entirely 00:04:59.519 --> 00:05:01.980 locked out of this. Like they are legally barred 00:05:01.980 --> 00:05:04.459 from licensing grand rights. Yeah, what's fascinating 00:05:04.459 --> 00:05:06.439 here is that the industry has drawn a strict, 00:05:06.579 --> 00:05:08.860 almost philosophical boundary around the word 00:05:08.860 --> 00:05:11.779 dramatic. In one silo, the music is just music. 00:05:12.540 --> 00:05:14.949 In the grand right silo, the music is serving 00:05:14.949 --> 00:05:17.069 a narrative. It's, you know, interacting with 00:05:17.069 --> 00:05:20.370 characters, advancing a plot, or carrying the 00:05:20.370 --> 00:05:22.250 emotional weight of a theatrical story. Right, 00:05:22.269 --> 00:05:25.370 it's doing work. Exactly. When music becomes 00:05:25.370 --> 00:05:28.290 a storytelling device, the legal mechanism to 00:05:28.290 --> 00:05:30.709 access it changes entirely. You can't just pay 00:05:30.709 --> 00:05:33.889 a blanket fee. You have to bypass the PROs entirely 00:05:33.889 --> 00:05:36.329 and negotiate directly with the copyright holder 00:05:36.329 --> 00:05:39.170 or the publisher. So, if small rights are the 00:05:39.170 --> 00:05:41.589 all -you -can -eat buffet, grand rights are like 00:05:41.589 --> 00:05:44.180 hiring a private exclusive s***. I like that 00:05:44.180 --> 00:05:46.920 you can't just pay a flat door fee you have to 00:05:46.920 --> 00:05:49.639 track the chef down pitch them the specific menu 00:05:49.639 --> 00:05:53.339 you want for your specific dinner party and Negotiate 00:05:53.339 --> 00:05:55.740 the price directly based on what you're asking 00:05:55.740 --> 00:05:58.819 them to cook right and Importantly the chef has 00:05:58.819 --> 00:06:00.639 the absolute right to look at your dinner party 00:06:00.639 --> 00:06:02.500 plans and say no. I don't want my food served 00:06:02.500 --> 00:06:05.000 there Wow The copyright holder retains total 00:06:05.000 --> 00:06:07.720 veto power. OK, I want to push back on a specific 00:06:07.720 --> 00:06:10.500 detail here, because the line between non -dramatic 00:06:10.500 --> 00:06:13.879 and dramatic seems, frankly, incredibly blurry 00:06:13.879 --> 00:06:16.600 in practice. It definitely can be. Like, the 00:06:16.600 --> 00:06:19.480 source explicitly states that grand rights include 00:06:19.480 --> 00:06:22.439 arrangements of music from a dramatic work. So 00:06:22.439 --> 00:06:24.540 let's go back to our jazz band in the coffee 00:06:24.540 --> 00:06:26.339 shop. OK, the jazz band. They're just playing 00:06:26.339 --> 00:06:28.079 instruments. They aren't wearing costumes. They 00:06:28.079 --> 00:06:31.240 aren't acting out a scene. If they play an instrumental 00:06:31.240 --> 00:06:33.240 jazz arrangement of a song that was originally 00:06:33.240 --> 00:06:35.939 written for a famous Broadway musical, why does 00:06:35.939 --> 00:06:38.180 the origin of the song matter? That's a great 00:06:38.180 --> 00:06:40.360 question. Like, why isn't that just a standard 00:06:40.360 --> 00:06:42.480 small right from the buffet? Because the DNA 00:06:42.480 --> 00:06:44.860 of that composition is inherently theatrical. 00:06:45.819 --> 00:06:50.079 The PRO license agreements actively exclude the 00:06:50.079 --> 00:06:53.259 use of compositions that originated from a... 00:06:53.100 --> 00:06:55.759 dramatic or musical work. Really? Just because 00:06:55.759 --> 00:06:57.920 of where it came from? Yes. The reasoning comes 00:06:57.920 --> 00:07:00.579 down to brand dilution and narrative integrity. 00:07:01.019 --> 00:07:03.040 When a composer writes a song for a musical, 00:07:03.519 --> 00:07:06.220 that song is essentially a character in the play. 00:07:06.660 --> 00:07:09.240 It holds a specific narrative weight. Oh, I see. 00:07:09.279 --> 00:07:11.480 So even if the jazz trio isn't acting it out, 00:07:11.620 --> 00:07:14.040 the song itself carries the ghost of the theater 00:07:14.040 --> 00:07:17.339 with it. Beautifully put, the copyright holder 00:07:17.339 --> 00:07:21.040 wants to tightly control how that theatrical 00:07:21.040 --> 00:07:23.889 property travels through the world. I mean, if 00:07:23.889 --> 00:07:25.889 anyone could just pull a Broadway showstopper 00:07:25.889 --> 00:07:27.930 from the ASCAP buffet and rearrange it however 00:07:27.930 --> 00:07:30.470 they wanted, it could dilute the value of the 00:07:30.470 --> 00:07:32.470 original stage production. That makes sense. 00:07:33.009 --> 00:07:35.550 The firewall ensures that the original dramatic 00:07:35.550 --> 00:07:38.970 intent of the work isn't morphed or commodified 00:07:38.970 --> 00:07:42.430 without the direct, explicit consent of the person 00:07:42.430 --> 00:07:44.860 who created it. I mean, I get that. I understand 00:07:44.860 --> 00:07:47.319 wanting to protect the art. But the sheer logistics 00:07:47.319 --> 00:07:49.579 of this sound like a nightmare. Oh, it's incredibly 00:07:49.579 --> 00:07:53.079 complex. If the PRO buffet model is working so 00:07:53.079 --> 00:07:55.579 beautifully for the entire radio and retail industry, 00:07:55.939 --> 00:07:58.379 why force the theater and dance worlds to go 00:07:58.379 --> 00:08:00.980 back to the dark ages of tracking down individual 00:08:00.980 --> 00:08:03.319 publishers? Wow. Like, think about a community 00:08:03.319 --> 00:08:06.240 theater trying to put on a local cabaret. Having 00:08:06.240 --> 00:08:08.759 to hunt down individual rights holders for 20 00:08:08.759 --> 00:08:11.360 different songs and negotiate bespoke contracts 00:08:11.360 --> 00:08:15.040 seems punishingly. It is inefficient. Why on 00:08:15.040 --> 00:08:17.199 earth wouldn't the industry want the exact same 00:08:17.199 --> 00:08:19.100 efficiency for the stage that they have for the 00:08:19.100 --> 00:08:21.279 radio? Right, so if we connect this to the bigger 00:08:21.279 --> 00:08:24.259 picture, we have to look at the historical evolution 00:08:24.259 --> 00:08:27.019 of music licensing. The tension you're pointing 00:08:27.019 --> 00:08:29.459 out between the efficiency of a system and the 00:08:29.459 --> 00:08:32.080 control of the artist that is the defining struggle 00:08:32.080 --> 00:08:34.799 of copyright history. Okay. Before the PROs even 00:08:34.799 --> 00:08:39.129 existed, before ASCAP or BMI, Every single use 00:08:39.129 --> 00:08:42.210 of a composition required a direct negotiation. 00:08:42.370 --> 00:08:44.629 Wait, really? 100 years ago, the private chef 00:08:44.629 --> 00:08:47.370 model was the only model. The only model. Yeah. 00:08:47.509 --> 00:08:49.450 Whether you were staging a massive opera in New 00:08:49.450 --> 00:08:51.830 York or just playing a new tune in a small tavern, 00:08:52.070 --> 00:08:53.889 the legal expectation was that you got direct 00:08:53.889 --> 00:08:56.350 permission from the publisher. That sounds exhausting. 00:08:56.570 --> 00:08:59.889 It was, but then... technology exploded. We saw 00:08:59.889 --> 00:09:02.169 the rise of the phonograph, and more importantly, 00:09:02.629 --> 00:09:06.129 the birth of radio broadcasting. Oh right, radio. 00:09:06.250 --> 00:09:08.909 Suddenly recorded music was everywhere. Radio 00:09:08.909 --> 00:09:11.190 stations were spinning dozens of records a day, 00:09:11.610 --> 00:09:14.899 365 days a year. And the math completely breaks 00:09:14.899 --> 00:09:17.879 down. I mean, you physically cannot have a radio 00:09:17.879 --> 00:09:20.100 station manager calling up a thousand different 00:09:20.100 --> 00:09:22.679 publishers every single week to negotiate the 00:09:22.679 --> 00:09:24.679 right to play a three -minute song. Exactly. 00:09:25.000 --> 00:09:27.019 The entire broadcasting industry would choke 00:09:27.019 --> 00:09:31.000 on its own paperwork. The shift to collective 00:09:31.000 --> 00:09:33.919 management, you know, the creation of PROs was 00:09:33.919 --> 00:09:37.450 born out of absolute unavoidable necessity. The 00:09:37.450 --> 00:09:41.450 volume of non -dramatic uses became so impossibly 00:09:41.450 --> 00:09:44.110 large that the industry had to create a utility. 00:09:44.129 --> 00:09:46.009 A utility, yeah. They centralized the rights 00:09:46.009 --> 00:09:48.590 to make the sheer scale of modern music consumption 00:09:48.590 --> 00:09:51.870 possible. It was a compromise. Composers gave 00:09:51.870 --> 00:09:54.690 up their right to directly negotiate every single 00:09:54.690 --> 00:09:57.009 radio play in exchange for a system that could 00:09:57.009 --> 00:09:59.289 actually collect their pennies at scale. Okay, 00:09:59.429 --> 00:10:01.210 that makes perfect sense for radio, but it brings 00:10:01.210 --> 00:10:04.850 me right back to my question. If Broadway publishers 00:10:04.850 --> 00:10:07.169 saw how beautifully efficient this utility was, 00:10:07.490 --> 00:10:09.929 why didn't they join in? Are publishers just 00:10:09.929 --> 00:10:11.929 being stubborn? Like, are they clinging to an 00:10:11.929 --> 00:10:14.889 old, slower system purely out of tradition? We 00:10:14.889 --> 00:10:17.210 actually find the answer to that in the psychology 00:10:17.210 --> 00:10:19.470 of the creators themselves. The source material 00:10:19.470 --> 00:10:21.909 features a really illuminating perspective from 00:10:21.909 --> 00:10:23.850 a musician named Jack Vease. Okay, what does 00:10:23.850 --> 00:10:25.610 he say? He cuts right through the romanticism 00:10:25.610 --> 00:10:28.590 of copyright and points out the raw business 00:10:28.590 --> 00:10:31.809 pragmatism at play. He argues that it is entirely 00:10:31.809 --> 00:10:34.549 understandable that a successful composer or 00:10:34.549 --> 00:10:37.190 publisher would not want to hand over control 00:10:37.190 --> 00:10:40.049 of negotiating rights if they are already doing 00:10:40.049 --> 00:10:43.309 exceptionally well in that specific arena. So 00:10:43.309 --> 00:10:45.590 it's about protecting the golden goose. Exactly. 00:10:45.710 --> 00:10:48.629 If you write a smash hit Broadway musical, you 00:10:48.629 --> 00:10:51.669 have created a highly lucrative, highly specialized 00:10:51.669 --> 00:10:54.370 asset. Right. You don't want to toss your golden 00:10:54.370 --> 00:10:57.070 goose into the giant P .R .O. buffet where your 00:10:57.070 --> 00:10:59.080 revenue gets averaged out and you have to to 00:10:59.080 --> 00:11:01.279 share the collective pool with someone who wrote 00:11:01.279 --> 00:11:04.179 a 30 -second jingle for a local car dealership. 00:11:04.799 --> 00:11:07.679 That economic reality drives the entire structure. 00:11:08.379 --> 00:11:11.120 And Vease introduces a very specific word to 00:11:11.120 --> 00:11:13.840 describe this dynamic. What word? He calls the 00:11:13.840 --> 00:11:16.299 division of labor between small and grand rights 00:11:16.299 --> 00:11:18.600 a conscious decision made by the members of a 00:11:18.600 --> 00:11:21.360 performing rights society. He says they set these 00:11:21.360 --> 00:11:23.659 rules because that's the way they wanted their 00:11:23.659 --> 00:11:26.519 particular club to work. A club. Oh, here's where 00:11:26.519 --> 00:11:28.480 it gets really interesting. It does, doesn't 00:11:28.480 --> 00:11:31.340 it? The word club completely shatters the usual 00:11:31.340 --> 00:11:34.340 framing of these organizations. We are constantly 00:11:34.340 --> 00:11:37.179 told that copyright organizations are these noble, 00:11:37.399 --> 00:11:40.220 neutral protectors of the starving artist, ensuring 00:11:40.220 --> 00:11:42.480 that music creators get their fair share. Right, 00:11:42.539 --> 00:11:44.919 the noble defenders. But Weez characterizes them 00:11:44.919 --> 00:11:48.120 as a private club deciding its own rules. I mean, 00:11:48.120 --> 00:11:50.919 it makes the PROs sound less like neutral public 00:11:50.919 --> 00:11:54.139 utilities and more like a society setting arbitrary 00:11:54.139 --> 00:11:56.019 boundaries just to protect the heavy hitters 00:11:56.019 --> 00:11:58.590 at the very top. Yeah, it strips away illusion 00:11:58.590 --> 00:12:01.470 that copyright structures are purely objective 00:12:01.470 --> 00:12:04.850 laws of nature. They aren't. They are negotiated 00:12:04.850 --> 00:12:07.149 agreements made by people with vested financial 00:12:07.149 --> 00:12:10.330 interests. The PROs are made up of members, and 00:12:10.330 --> 00:12:12.169 the members who hold the rights to the most lucrative 00:12:12.169 --> 00:12:15.389 dramatic works recognize very early on that a 00:12:15.389 --> 00:12:17.750 dramatic integration is inherently more valuable 00:12:17.750 --> 00:12:21.149 than a background spin on the radio. When music 00:12:21.149 --> 00:12:23.169 carries the emotional climax of a theatrical 00:12:23.169 --> 00:12:27.240 scene, its financial value skyrockets. The creators 00:12:27.240 --> 00:12:29.399 of that value simply voted to keep the rights 00:12:29.399 --> 00:12:31.899 to that amplified value for themselves rather 00:12:31.899 --> 00:12:34.620 than pooling it. But surely it isn't just a matter 00:12:34.620 --> 00:12:37.179 of a private club wanting to hoard its wealth. 00:12:37.559 --> 00:12:39.679 Like a group of powerful people getting together 00:12:39.679 --> 00:12:42.220 in a room and agreeing not to participate in 00:12:42.220 --> 00:12:44.639 a broader market sounds like it edges into some 00:12:44.639 --> 00:12:47.559 very dangerous legal territory. It absolutely 00:12:47.559 --> 00:12:50.639 does. And this brings us to Jack Vease's second 00:12:50.639 --> 00:12:53.669 much more severe argument. The separation of 00:12:53.669 --> 00:12:55.750 grand rights isn't just about publisher preference. 00:12:56.250 --> 00:12:58.509 It is a structural defense against the law. How 00:12:58.509 --> 00:13:01.610 so? Well, Vease argues that allowing PROs to 00:13:01.610 --> 00:13:03.950 engage in negotiations for the use of compositions 00:13:03.950 --> 00:13:07.470 in dramatic works could actively encourage illegal 00:13:07.470 --> 00:13:10.769 price fixing. Price fixing. Wait, that is a massive 00:13:10.769 --> 00:13:13.090 accusation to throw at the structure of music 00:13:13.090 --> 00:13:15.529 licensing. It's a huge claim. I need to understand 00:13:15.529 --> 00:13:18.889 the mechanics here. PROs already hold the keys 00:13:18.889 --> 00:13:21.409 to millions of songs. They already walk into 00:13:21.409 --> 00:13:24.350 a coffee shop and say, pay this exact standardized 00:13:24.350 --> 00:13:26.649 rate for our blanket license or we will sue you 00:13:26.649 --> 00:13:29.210 for infringement. How is that not already price 00:13:29.210 --> 00:13:31.629 fixing? Why is putting grand rights into that 00:13:31.629 --> 00:13:34.289 exact same bucket the specific thing that crosses 00:13:34.289 --> 00:13:36.730 the legal tripwire? This raises an important 00:13:36.730 --> 00:13:39.370 question. To understand the legal distinction, 00:13:39.570 --> 00:13:41.529 we have to look at the difference between standardizing 00:13:41.529 --> 00:13:45.009 a basic commodity versus standardizing a bespoke 00:13:45.009 --> 00:13:48.389 service. Okay. Think of small rights like the 00:13:48.389 --> 00:13:51.669 price of electricity. It makes economic sense 00:13:51.669 --> 00:13:54.370 for the government to allow a regulated standardized 00:13:54.370 --> 00:13:56.750 rate for the raw juice that keeps the lights 00:13:56.750 --> 00:13:59.610 on in the coffee shop. Sure. The music in a non 00:13:59.610 --> 00:14:02.289 -dramatic context is created as a high -volume 00:14:02.289 --> 00:14:05.490 commodity. The government allows PROs to consolidate 00:14:05.490 --> 00:14:08.429 power for small rights because the public benefit 00:14:08.429 --> 00:14:10.669 of having music on the radio outweighs the risk 00:14:10.669 --> 00:14:13.350 of the monopoly. Right. The sheer volume demands 00:14:13.350 --> 00:14:15.009 the efficiency like we talked about earlier. 00:14:15.350 --> 00:14:18.070 Exactly. But grand rights are not a commodity. 00:14:18.379 --> 00:14:20.980 Using music in a dramatic work is like hiring 00:14:20.980 --> 00:14:23.860 an architect to design a custom building. Oh, 00:14:23.919 --> 00:14:26.039 I see. Every stage production is unique. The 00:14:26.039 --> 00:14:28.080 way the music interacts with the script, the 00:14:28.080 --> 00:14:31.019 staging, and the audience, it's a highly bespoke 00:14:31.019 --> 00:14:33.419 creative integration. OK, I see where this is 00:14:33.419 --> 00:14:36.080 going. If all the architects in the country formed 00:14:36.080 --> 00:14:39.820 one single organization, refused to let you negotiate 00:14:39.820 --> 00:14:43.240 with them individually, and dictated one massive, 00:14:43.580 --> 00:14:46.360 non -negotiable flat fee for any building design. 00:14:46.519 --> 00:14:48.080 The government would immediately interview and 00:14:48.080 --> 00:14:51.360 dismantle it as an illegal cartel. Exactly. Because 00:14:51.360 --> 00:14:53.799 they would completely eliminate the free market 00:14:53.799 --> 00:14:56.580 for architecture. Wow. And exactly the same principle 00:14:56.580 --> 00:14:59.120 applies to theater. Dramatic integrations are 00:14:59.120 --> 00:15:02.549 high stakes. custom, and relatively low volume 00:15:02.549 --> 00:15:05.429 compared to radio plays. Right. If a massive 00:15:05.429 --> 00:15:08.330 centralized organization like ASCOP were allowed 00:15:08.330 --> 00:15:11.149 to dictate standard prices for custom dramatic 00:15:11.149 --> 00:15:13.309 integrations, they could effectively hold the 00:15:13.309 --> 00:15:15.429 entire theatrical industry hostage. They control 00:15:15.429 --> 00:15:17.250 everything. They can monopolize the market for 00:15:17.250 --> 00:15:19.970 stage productions. So by keeping grand rights 00:15:19.970 --> 00:15:22.909 out of the PROs, the industry ensures a free 00:15:22.909 --> 00:15:25.529 market where the price of a dramatic musical 00:15:25.529 --> 00:15:28.649 performance is determined by individual direct 00:15:28.649 --> 00:15:31.909 bargaining, not a centralized monopoly. So the 00:15:31.909 --> 00:15:34.789 firewall isn't just a quirk of history. It is 00:15:34.789 --> 00:15:38.049 a necessary legal barrier to prevent a single 00:15:38.049 --> 00:15:41.070 organization from having absolute unchecked power 00:15:41.070 --> 00:15:43.389 over the creation of new dramatic art. You've 00:15:43.389 --> 00:15:46.470 got it. Standardizing the price of a bespoke 00:15:46.470 --> 00:15:50.210 artistic integration removes all market competition. 00:15:51.289 --> 00:15:54.389 The creator loses their leverage and the producer 00:15:54.570 --> 00:15:57.429 loses their ability to negotiate based on the 00:15:57.429 --> 00:16:00.070 specific scale and budget of their show. You 00:16:00.070 --> 00:16:02.029 know, think about the real -world implications 00:16:02.029 --> 00:16:04.129 of this the next time you pay for a ticket to 00:16:04.129 --> 00:16:06.490 a musical or a modern dance performance or even 00:16:06.490 --> 00:16:08.769 like drop a few dollars in a bucket to see a 00:16:08.769 --> 00:16:11.090 local high school play. Yeah, it changes your 00:16:11.090 --> 00:16:13.250 whole perspective. Part of the cost of that ticket, 00:16:13.429 --> 00:16:15.289 the availability of that show in your town and 00:16:15.289 --> 00:16:17.159 the fact that if the production exists at all, 00:16:17.460 --> 00:16:20.399 is a direct result of this invisible firewall. 00:16:20.639 --> 00:16:23.080 Absolutely. The creators of that show had to 00:16:23.080 --> 00:16:25.480 bypass the easy buffet. They had to navigate 00:16:25.480 --> 00:16:27.980 the grand rights system, find the private chef, 00:16:28.139 --> 00:16:30.720 and negotiate a bespoke contract. The budget 00:16:30.720 --> 00:16:33.240 of the show was shaped by that direct negotiation. 00:16:33.779 --> 00:16:35.279 So the performance happening in front of you 00:16:35.279 --> 00:16:37.480 is a testament to someone successfully navigating 00:16:37.480 --> 00:16:39.940 a system designed to protect against monopolies 00:16:39.940 --> 00:16:42.360 while ensuring original composers get their custom 00:16:42.360 --> 00:16:45.039 payday. It completely reframes the experience 00:16:45.039 --> 00:16:47.080 of live performance, doesn't it? You are not 00:16:47.080 --> 00:16:49.340 just sitting in the dark witnessing artistic 00:16:49.340 --> 00:16:51.820 expression. You are witnessing the end result 00:16:51.820 --> 00:16:56.799 of a highly specific, legally mandated economic 00:16:56.799 --> 00:17:00.299 negotiation playing out in real time. It really 00:17:00.299 --> 00:17:02.779 is wild. So what does this all mean for us? We 00:17:02.779 --> 00:17:04.940 started by decoding the three silos of music 00:17:04.940 --> 00:17:07.759 licensing, right? The high volume buffet of small 00:17:07.759 --> 00:17:10.839 rights handled by the PROs, the permanent video 00:17:10.839 --> 00:17:13.480 pairing of sync rights, and the highly bespoke, 00:17:13.759 --> 00:17:15.859 strictly guarded world of grand rights. Right. 00:17:16.079 --> 00:17:18.460 We explored the history, seeing how the explosion 00:17:18.460 --> 00:17:21.000 of radio and recorded music forced the creation 00:17:21.000 --> 00:17:23.480 of collective management, simply to handle the 00:17:23.480 --> 00:17:25.640 impossible math of non -dramatic consumption. 00:17:26.119 --> 00:17:28.160 And we also unpacked the pragmatic reality of 00:17:28.160 --> 00:17:30.619 the industry through Jack V's concept of the 00:17:30.619 --> 00:17:33.339 club. We saw how successful artists fiercely 00:17:33.339 --> 00:17:35.799 guard the direct control of their most lucrative, 00:17:35.980 --> 00:17:38.319 dramatically integrated works because they truly 00:17:38.319 --> 00:17:41.119 understand the amplified value of narrative context. 00:17:41.349 --> 00:17:44.609 And finally, we looked at the massive legal guardrails 00:17:44.609 --> 00:17:47.250 holding the whole system in place. We learned 00:17:47.250 --> 00:17:49.970 that this fragmented, seemingly inefficient system 00:17:49.970 --> 00:17:52.309 for theaters isn't just about publishers being 00:17:52.309 --> 00:17:54.869 stubborn. Not at all. It is a structural necessity 00:17:54.869 --> 00:17:57.789 to prevent illegal price -fixing and monopolies 00:17:57.789 --> 00:18:00.349 in the high -stakes custom world of the dramatic 00:18:00.349 --> 00:18:02.630 arts. You know, looking at this history leads 00:18:02.630 --> 00:18:04.990 us with a really fascinating tension regarding 00:18:04.990 --> 00:18:08.890 the future. Oh, how so? Well, the entire justification 00:18:08.890 --> 00:18:11.960 for the PROs. The reason the buffet was created 00:18:11.960 --> 00:18:14.460 in the first place was because the sheer volume 00:18:14.460 --> 00:18:18.099 of non -dramatic radio play made direct negotiation 00:18:18.099 --> 00:18:20.440 physically impossible. Right. The technology 00:18:20.440 --> 00:18:23.180 outpaced the old system. But look at the technology 00:18:23.180 --> 00:18:26.579 we have today. We are living in an era of unprecedented 00:18:26.579 --> 00:18:29.460 user -generated content. Oh, wow. Yeah. Digital 00:18:29.460 --> 00:18:31.480 platforms are allowing millions of creators to 00:18:31.480 --> 00:18:35.220 adapt music for highly contextual, dramatic narrative 00:18:35.220 --> 00:18:37.799 works at lightning speed. People are essentially 00:18:37.799 --> 00:18:40.339 creating mini musicals and dramatic interpretations 00:18:40.339 --> 00:18:43.559 on their phones every single day. That is a staggering 00:18:43.559 --> 00:18:46.359 amount of volume, like way more than early radio. 00:18:46.779 --> 00:18:50.960 Exactly. So if the volume of dramatic narrative 00:18:50.960 --> 00:18:54.059 music use online begins to mirror the volume 00:18:54.059 --> 00:18:57.039 of radio play a century ago, the math is going 00:18:57.039 --> 00:18:59.799 to break all over again. Mind blown. The question 00:18:59.799 --> 00:19:03.619 becomes... Will the bespoke direct negotiation 00:19:03.619 --> 00:19:06.859 club rules of grand rights eventually buckle 00:19:06.859 --> 00:19:09.519 under the massive relentless pressure of digital 00:19:09.519 --> 00:19:12.440 scale? The technology might force the law to 00:19:12.440 --> 00:19:14.819 evolve all over again, just like it did 100 years 00:19:14.819 --> 00:19:16.779 ago. That is incredibly thought provoking. It 00:19:16.779 --> 00:19:18.680 is definitely something to keep an eye on. For 00:19:18.680 --> 00:19:20.380 sure. Well, thank you for joining us on this 00:19:20.380 --> 00:19:22.640 deep dive. The next time you find yourself sitting 00:19:22.640 --> 00:19:24.880 in a theater as the lights go down and the orchestra 00:19:24.880 --> 00:19:27.079 strikes up that first chord, I hope you listen 00:19:27.079 --> 00:19:30.480 closely. Me too. Because behind every soaring 00:19:30.480 --> 00:19:33.160 melody, there is a very quiet, very powerful 00:19:33.160 --> 00:19:35.440 legal architecture that dictates exactly what 00:19:35.440 --> 00:19:37.500 you are allowed to hear. Catch you next time.