[UPDATED] SoundExchange has launched Music Data Exchange (MDX), a free software application designed to facilitate the exchange of sound recording and publishing data and ownership claims between record labels and music publishers.
MDX was developed in cooperation with the RIAA and National Music Publishers Association, along with senior music industry executives.
MDX hopes to provide a central database of real-time, pre-release, metadata and publisher rights and claiming capabilities. It uses automated messaging to enable high-volume, efficient exchanges of data, while still offering publishers full visibility to claimed and unclaimed shares in new sound recordings.
“the old approach was wildly inefficient”
Jonathan Bender, Chief Operating Officer at SoundExchange, led the effort to develop MDX. The performing rights organization’s William Glanz conducted an in depth interview with Bender on why MDX is important and how it will help the music industry.
SoundExchange: Can you explain when and how the idea to develop MDX came up?
Bender: The idea for MDX grew out of a Request for Proposal that SoundExchange received from the NMPA in April 2016. At that time, NMPA was looking for a vendor to build a claiming portal, pursuant to settlement talks the NMPA was having with music services. The portal would publish and make available for claiming those sound recordings for which music services had been unable to identify the music publisher of the underlying composition. Publishers would use the site to search for their compositions and place claims.
We responded to the request to create such a portal, but in the process, it occurred to us that we were addressing a problem after it happened. We said, “Isn’t there a way to address the problem before it happens? Before you get to the point where you have settlements and lawsuits and unhappy writers and publishers?”
That was the core idea of Music Data Exchange – to create a centralized, rational process for labels to request publishing data and for the publishers to respond to those requests on a central site.
SoundExchange: Did you begin building it right away?
Bender: We worked with a joint committee of the NMPA and the RIAA called the Best Practices Working Group. They recognized they had a problem, but their only approach was email-based, which doesn’t scale in an industry with millions of new recordings each year.
In November 2016, SoundExchange proposed to create Music Data Exchange. We said, “With your support, we will build a central site for the exchange of sound recording and publishing data.”
In January 2017, they agreed to participate, and we began the work.
SoundExchange: As you were drawing up MDX, did you have any hesitations – not about whether it made sense, but about whether it would work in the manner you hoped?
Bender: Clearly, but throughout the process we were deeply engaged with the labels and the publishers – the ultimate users of the site. We created a sub-group of the Best Practices Working Group, which actively worked with us and were engaged the entire time. We spent six months meeting with labels and publishers on the requirements for the site. We published a formal specification, the labels and publishers signed off, and we began development.
In short, we didn’t go off on our own and just do it. We’re exceptionally grateful for the level of support we had from labels and publishers throughout the process. We spoke with them weekly, and they were completely engaged – testing, reviewing, commenting, working with us, supporting us, generating ideas. It was a terrific, collaborative process.
SoundExchange: Did you get any industry feedback that confirmed your suspicion that MDX was needed?
Bender: From the beginning there was unanimity that the old approach was wildly inefficient. It was all email based, and that’s a problem. In one of my first meetings with one label’s copyright department I asked, “How do you get the publishing data?” They said they generate a report of all their new releases each week, typically hundreds of recordings, hand it to their copyright people, and then they commence to email publishers they know asking “is this your song?”
That’s just one label. Add hundreds of labels and hundreds of publishers to that, and thousands of recordings a week. It’s no surprise that it’s a mess.
SoundExchange: You don’t like email?
Bender: Email is not a workflow. It’s not a process. It’s effective for one-off communications, but not ongoing data exchange for the volume of recordings the industry deals with. The situation is so bad that you had a member of Congress introduce a bill to force the industry to create a central database to deal with this. That speaks to the magnitude of the problem.
SoundExchange: What about MDX will appeal to publishers?
Bender: First, it’s a centralized resource for all these data requests. Having a central place to find all these requests is a great benefit, in terms of efficiency.
Second is visibility. Publishers may not know there’s a new sound recording of their song, and then they hear it or see it on the charts. Now there is one place where publishers can go to see all new recordings, and submit their shares.
Third, the process is timely. In a perfect copyright world, a song is licensed before it’s played. In practice, there’s often a gap between release and when all the shares are known. We aren’t saying MDX will solve that in every case. But MDX provides a mechanism for labels to request – and publishers to respond – information before release.
The fourth advantage is identifying claims overlaps. A typical pop song these days can have four or more songwriters. Often, there are conflicts between shares, and there’s no one place to go to see what the overlaps are and who has overclaimed. MDX provides that. All the claims come in, and MDX adds them up. If there’s an overclaim, it’s flagged and put in a special section on the site – publishers can see the overclaims and take steps to resolve them.
SoundExchange: In addition to identifying the composer of a musical work, it’s also important to make the link between a composition and a sound recording. Does MDX help accomplish that?
Bender: Absolutely. Linking recordings to songs is at the core of MDX. The first step in paying mechanical royalties is to identify the composition underlying the sound recording. That might seem straightforward, but it’s easier said than done.
Once you make the link between the composition and the recording, then you can move to the next step – allowing record labels to identify who receives mechanical royalties. MDX allows record labels to accomplish both of those steps.
SoundExchange: The lack of transparency into musical works use has been a profound concern of songwriters and publishers. Will MDX address that concern?
Bender: We think it will. SoundExchange has championed transparency in the music industry since our inception. We aggregate sound recording metadata from all the major and independent labels and make that data available through our ISRC Search database, ISRC.SoundExchange.com
When we became involved in music publishing through our acquisition of the Canadian Musical Reproduction Rights Agency (CMRRA), we brought the same culture of transparency. MDX is the result of our philosophy that transparency benefits the whole industry.
SoundExchange: Are you nervous about the launch?
Bender: I’m confident because of the level of engagement we have had, and still have, from the industry, labels and publishers alike. MDX wouldn’t have happened without their efforts. I believe we’ve done all the right things to make this a solution that works for the industry, and I’m genuinely excited to see the results.