An Editorial by Dawoud Kringle
Broadcast Music Inc. (BMI), one of the major performing rights organizations (PRO) in the United States, was founded in 1939 by the National Association of Broadcasters.
In the late 1930s, royalties to publishers and songwriters worked differently than they do today. Rather than paying for the songs that they played, broadcasters were required to hand over a certain percentage of their revenue to a PRO, regardless of how much music they played, or which artists. During the Great Depression, ASCAP (the dominant PRO at that time, founded in 1914, and still the second-largest in the US today) raised the percentage it required broadcasters to pay. The radio broadcasters rebelled, and set up their collection organization; BMI. The US Justice Department under the Roosevelt Administration ran an antitrust investigation of ASCAP, and BMI. Both organizations entered into “consent decrees” with the Justice Department, requiring them to allow radio stations to pay only for the music they played, and requiring both organizations to offer their entire catalogs to broadcasters.
With only a few alterations, those consent decrees have governed ASCAP and BMI’s operations ever since. BMI and ASCAP have since operated on a nonprofit basis, collecting and distributing licensing fees to its affiliated songwriters and publishers after paying its overhead/operation costs. These PROs do not own copyrights.
