Once 2021 rolls in, creators and songwriters in the U.S. will face a new and improved playing field when it comes to digital mechanical royalties. That's all thanks to the Mechanical Licensing Collective (MLC), a new entity that will administer a new blanket mechanical license for streaming and download services starting Jan. 1, 2021. 

Established under the game-changing Music Modernization Act (MMA), which President Trump signed into law in 2018, the MLC will administer a more efficient payment system that will better identify, match and distribute unclaimed songwriter and publisher royalties and, with the help of the Recording Academy and the U.S. Copyright Office, will assist in songwriter outreach. This all means creators will get paid what they are rightfully owed in a fairly and timely manner under the new MLC system.

To address questions about how it will work, the Academy's Advocacy team hosted a special webinar this week (Nov. 9) to explain exactly what the MLC is—and what it's not—and how it'll benefit creators across the globe.

Moderated by the Recording Academy's Chief Advocacy Officer Daryl Friedman, with opening remarks from Recording Academy Chair and Interim President/CEO Harvey Mason jr., the webinar invited MLC CEO Kris Ahrend to dive deep into the mechanics behind the forthcoming opportunities and benefits under the MLC. Special guest Tayla Parx, the celebrated songwriter and GRAMMY nominee ("Thank U, Next," "High Hopes" and "Love Lies"), also joined the conversation to offer her real-life experiences and advice to the Recording Academy members who attended the webinar. 

To recap the informative conversation, here are five key quotes from Advocacy's Mechanical Licensing Collective webinar.

Recording Academy's Chief Advocacy Officer Daryl Friedman (L) and MLC CEO Kris Ahrend (R)

"We live in a global world where music does not remain within boundaries."

First things first: As noted on its website, the MLC will only "issue and administer blanket mechanical licenses for eligible streaming and download services (digital service providers or DSPs) in the United States." That means if you're a creator based in the U.S. and one of your songs gets streamed on Spotify in Japan or sold on Amazon Music in the U.K., the MLC will not administer licenses covering ex-U.S. uses of any kind. 

However, the MLC will indeed benefit international creators. 

"We collect and distribute those digital audio mechanicals that are paid pursuant to that new blanket license," Ahrend explained. "And then here's the key: We pay the person entitled to receive those mechanicals wherever in the world they are. While the blanket license is only available to digital services for their U.S. operations, as all of you know, we live in a global world where music does not remain within boundaries."

"Don't assume the MLC replaces any existing organization that pays you."

While the above example sounds easy enough, the breakdown of the different types of licensing and synchronization rights and publishing and mechanical royalties available across the wider music business can often feel overwhelming. That's why it's very important to understand what the MLC does and does not do.

Simply put, the MLC will focus exclusively on digital mechanical royalties. It will not administer performance royalties for songwriters, digital performance royalties for sound recording owners and performers, licenses covering audiovisual uses (syncs) or mechanical licenses for physical products. To cover all of these different types of income sources, creators should continue to work with their respective royalty agencies and performance rights organizations (PROs) like SoundExchange, Songtrust, ASCAP, BMI, SESAC, GMR and others.

Ultimately, Ahrend said, the MLC will be a complementary income source to the ccollective rights organizations and PROs you already have on your team: "All of those organizations exist because the way that the laws behind music are set up is complicated. But the most important takeaway, I think, for anyone watching is: Don't assume that the MLC replaces any existing organization that pays you," Ahrend said.

"If you're confused by this, you are in the vast majority."

Both Tayla Parx and the MLC's Ahrend will be the first to tell you that navigating the complex world of royalties, rights and syncs is not an easy task. 

"If you're confused by this, you are in the vast majority," Ahrend said. "This is not easy, and you should keep pushing to understand because it is important, it is worth it. It's your business, it's the thing that will hopefully enable you to continue to be a creator for the rest of your life. We want to try to simplify as much of it as we can, and certainly our piece."

Luckily for creators, the MLC will offer its forthcoming, user-friendly MLC Portal, which will allow creators to enter their data, check their data for accuracy and completeness, register new musical works and identify new sound recordings that feature their works, according to the MLC website.

Clockwise from top-left: Recording Academy's Chief Advocacy Officer Daryl Friedman, MLC CEO Kris Ahrend,  GRAMMY-nominated songwriter Tayla Parx

"The most important thing we value is our time."

From independent songwriters and creators to major publishing houses to music publishing rights companies like Songtrust, the MLC will service the entire U.S. music industry. 

Self-administered songwriters, composers, and lyricists will be able to easily navigate the MLC Portal on their own, but Ahrend also acknowledges the value of publishers and related agencies that can handle the data process and manage administrative royalty tasks on behalf of creators.

"We have designed everything we're doing to be as user-friendly as possible such that you can do this with us if you choose. But that said, there are a myriad of companies out there that offer really valuable services," Ahrend said. 

"At some point in your career, and this is true of all of us in life, the most important thing we value is our time," he continued. "So when you think about whether you can do this yourself, it's really a question of time. Is that time that you have and want to spend doing it?"

Adds Parx, "It's all about how much time you feel like you're willing to take away from it, and that goes down to how much you value your time in the studio or being creative. But I like that it gives you an option."

"You matter, and we want to make sure that you get paid properly."

While many artists operate independently or with small teams, creators of all sizes and scope will be able to benefit from the new MLC payment system, so long as you're registered with the MLC Portal. Sure, unlocking the world of royalties is no easy task. But the MLC is here to help everyone, from independent creators to publishing corporations across the U.S., no matter the size of your team. 

Regardless of your setup, Ahrend highly recommends that all self-administered songwriters "in any respect," meaning "for any of your works," join the MLC to ensure the organization can administer the mechanicals you're owed on all the works you administer for yourself. 

"We are here. We will deal with you in the same way that we deal with the largest publishers, the largest CMOs outside the U.S., the largest administrators," Ahrend said of self-administered creators. "You matter, and we want to make sure that you get paid properly."

Missed the program or want to watch it again? View the full webinar on the Recording Academy's Facebook page.

Mechanical Licensing Collective Webinar: 5 Things To Know About The MLC