CISAC's ISWC system gets a major overhaul to improve accuracy, efficiency and speed in tracking royalties

By Emmanuel Legrand

 

The International Confederation of Authors Societies (CISAC) has launched a new, modernised version of its global ISWC system, the unique code that identifies music works, with over 100 authors' societies in the world having already migrated to the new system. The project, which was two years in the making, is expected to "improve the accuracy, speed and efficiency of societies’ work in tracking creators’ works and paying royalties," according to CISAC.

 

  The International Standard Musical Work Code is a unique, permanent and internationally recognised ISO reference number for the identification of musical works. The ISWC is part of the CIS plan (Common Information System) which CISAC has developed over the years to ensure that music works were properly identified. Over the last 15 years, more than 50 million ISWC codes have been allocated to music works.

 

  For Jeff King, Chair of Digital Data Exchange (DDEX) and, Chief Operating and Corporate Development Officer of Canada's society SOCAN, the ISWC code "is one of the key identifier terms for musical works within the DDEX standards, and these improvements should speed the flow of information about a registered work’s writers and publishing information throughout the global digital ecosystem.”

 

Improve the flow between societies

 

  The new system, developed since 2018 by Spanish Point Technologies, will help societies and music publishers "manage the trillions of data transactions generated by the growth of music streaming," said CISAC. CISAC revealed that societies collections for digital music rose 27% in 2019 to €2.1 billion and have almost tripled in the last five years.

 

  Over a 100 societies already did a "switchover" in July to the new system and CISAC said it "will also be shortly rolled out for use by the publishing community and digital music platforms" and will "improve the information flow between societies, publishers and platforms, helping keep pace with the explosion of music streaming." 

 

  "We are now working closely with our partners across the music sector to make sure the upgraded system is used universally across the digital music market," said Gadi Oron, Director-General of CISAC.

  “The upgrade of the ISWC could not come at a more timely moment for songwriters and composers, who are now depending more than ever on digital income for their livelihoods," said CISAC President Björn Ulvaeus (pictured, above). "ISWC is one of the most important identifiers in the music industry and I´m delighted that the upgrade is now completed and is being implemented across the sector. It will track music works better and faster and help put more money more quickly into creators’ pockets. The key now is to make sure the system really does go global – it needs to be universally applied to bring the potential rewards it offers to all players.”

 

  CISAC listed the new benefits brought by the new ISWC system:

  > Greater accuracy, with codes assigned centrally, by CISAC, to avoid duplication and inaccuracies. "The new system will end the current practice of having ISWC codes allocated by individual societies, a practice that leads to many data integrity challenges," said CISAC. "Central assignment will guarantee that each song will get only one unique code." 

  > Faster speed, as the new system "dramatically reduces the time it takes to assign ISWCs." The codes will then be ready for use by all partners in the commercial chain (publishers, sub-publishers, digital services) within hours of the work’s release, so that a song used on Spotify, Amazon, Apple Music or others can be monetised without delay.

  > Increased efficiency, as the new ISWC project "takes the friction out of the digital licensing process, reduces costs and brings more value." Oron said the new, fully functioning automated allocation system "will save time and costs for all parties and most importantly, will help deliver more royalties to creators."

 

A real progress

  For data expert Paul Jessop, a UK-based media industry identifiers consultant and member of the ISO standards committee that publishes ISWC, the modernisation of the ISWC system was long overdue to coincide with the way in which music in consumed at the moment. "ISWC is a well thought-out identifier but in operation it suffered from being assigned late – many months too late to be useful in some cases," Jessop told Creative Industries Newsletter. "This new implementation, which has been done within the framework of the same ISO standard as before, should radically improve matters. It might even be available in the studio when a band has turned its jam session into a hit song. "

  Jessop admits that "there are still issues" such as songwriters who aren’t members of a CISAC society "struggle to get codes and the database doesn’t offer an open API that would let people outside a magic circle access the data. But this is real progress."

Shira Perlmutter appointed new Register of Copyrights

By Emmanuel Legrand

Librarian of Congress Carla Hayden has appointed Shira Perlmutter (pictured, above) as the 14th Register of Copyrights and director of the US Copyright Office. In her new role, she will lead the 150-year-old institution that plays a central role in administering US Copyright law and advising Congress on copyright policy decisions.

 

  Among her priorities will be the ongoing modernisation of the Copyright Office and ensuring that the Music Modernisation Act of 2018 in properly implemented, in particular the Music Licensing Collective, due to start operating on January 1, 2021, while at the same time continuing to review portions of the 1998 DMCA legislation.

  Perlmutter will fill a position that had been left vacant since the departure of Karyn Temple to the Motion Picture Association in January 2020. In the interim, Associate Register of Copyrights for Policy and International Affairs Maria Strong served as acting Register. Strong will return to her position once the the appointment of Perlmutter will be effective at the end of October.

 

Immeasurably qualified

  Maria Pallante, the President of the Association of American Publishers (AAP), who was herself a former Register of Copyrights and was demoted in 2016 by Carla Hayden and subsequently resigned, said she considered Perlmutter to be "an exceptional copyright lawyer and government executive." For Pallante, "Shira is immeasurably qualified to both lead the agency and guide the significant law and policy developments that are the Register’s statutory mandate."

  Perlmutter has served since 2012 as chief policy officer and director for international affairs at the United States Patent and Trademark Office (USPTO). Previously, she worked in London as executive vice president for global legal policy at the International Federation of the Phonographic Industry (IFPI).

  She is not a stranger to the Copyright office as she served as the Associate Register for Policy and International Affairs from 1995 through 1999. At the USPTO, she worked with other government and regulatory agencies including the Copyright Office, the Office of the US Trade Representative, the US Department of State, the US Department of Justice, among others. 

 

Deep knowledge of copyright law

 

  Hayden said Perlmutter "brings to this role a deep knowledge of domestic and international copyright law and policy and a background in negotiating international intellectual property agreements. She has experience working with a wide range of stakeholders and finding common ground on complex issues.”

  “I’m honored to have the opportunity to lead the US Copyright Office during its 150th year,” said Perlmutter. “I look forward to working with Dr. Hayden and rejoining the dedicated staff of the Copyright Office on its mission of promoting the creation and dissemination of works of authorship to the benefit of the American public.” 

            
  Well-known within the copyright and IP community, Perlmutter's appointment was welcomed by stakeholders such as the Copyright Alliance. Keith Kupferschmid, the CEO of the Washington, DC-based organisation, praised Hayden "for selecting such an experienced, knowledgeable, and capable person to be the next Register." He added: “In appointing Register Perlmutter, Dr. Hayden has entrusted the US Copyright Office to someone who has been a proven leader and a beacon of knowledge and integrity within the intellectual property community for decades and will serve all stakeholders and users of the Copyright Office services well in her new post."

 

Advance the public good

  Mitch Glazier, Chairman and CEO of the Recording Industry Association of America (RIAA), said Perlmutter was an "outstanding choice." “No one knows more about copyright than Shira," said Glazier. "In her long career of public service and scholarship, Register Perlmutter has consistently worked to promote understanding and progress in copyright law and has established herself as a preeminent authority. We look forward to working with Register Perlmutter as she brings people together to advance the public good through a wise and rigorous understanding and application of US Copyright law."

 

  For Michael Huppe, President and Chief Executive Officer of neighbouring rights society SoundExchange Perlmutter’s "extensive background both in government and the private sector makes her an inspired choice to be the Register of Copyrights.” 

 

  Motion Picture Association Chairman and CEO Charles Rivkin said that Perlmutter has shown a "commitment to supporting the rights of creators for the ultimate public good."

  Interestingly, the American Library Association (ALA) also welcomed of Hayden's choice, based on her experience in working with the library community on the US implementation of the Marrakesh Treaty during which she "demonstrated a commitment to improved access to information resources and reading materials for print disabled persons in the United States and around the world," according to ALA President Julius C. Jefferson Jr. He added: "As digital copyright policy and modernization of the Copyright Office are at a critical stage of formation, Ms. Perlmutter’s ability to collaborate with both users of information and rights holders has the potential to bring balance to the expanding ecosystem of creators, consumers and copyright holders.”

AEPO-ARTIS, ECSA and FIM at war against companies providing royalty-free music based on buy-out contracts

By Emmanuel Legrand

 


Three organisations representing songwriters, performers and musicians have singled out Swedish company Epidemic Sound and free-music platform Jamendo for partnering with software company Adobe to launch a library of “royalty-free” music.

  The deal, originally announced in June 2020, provides Adobe users who access royalty-free images through the photo library Adobe Stock to also use royalty-free music. The functionality is also available to Adobe Premiere Pro users. Adobe said at the launch that the new services was "is a big win for creatives granting them access to the most comprehensive solution for video projects in the market."

  Adobe added that what made Epidemic Sound and Jamendo both stand out was "their commitment to quality, their community of musicians, and the creatives who need that perfect track." Oscar Höglund, Co-Founder and CEO of Epidemic Sound, said at the time: “Adobe and Epidemic Sound are driven by the very same reason for being: the drive to empower and fuel our creator communities all over the world."

Hindering creators' ability to earn a living

  However, the Association of European Performers’ Organisations (AEPO-ARTIS), the European Composer and Songwriter Alliance (ECSA), and the International Federation of Musicians (FIM) – which collectively represent over 500 000 composers, songwriters and performers – argue that instead the partnership "further hinders the music creators’ ability to earn a living from the exploitation of their works and performances." 

  It added: "In a context where our members activities are under existential threat because of the COVID-19 pandemic and its consequences, the development of buy-out contracts eludes the collective rights management system and prevents guaranteed payments based on remuneration rights."

  The three organisation are especially concerned by what they call "the harmful development" of Epidemic Sound, which is selling “royalty-free music” to various commercial companies, like video-on-demand platforms and TV stations by using 100% buy-out contracts (contracts by which music authors and performers sell their rights for the full term of protection in exchange for a lump sum payment).

Put an end to buy-out contracts

  These methods, argued the three organisations, deprive authors and composers from receiving payment of royalties and equitable remuneration. In a statement, they noted: "The expansion of Epidemic Sound represents yet another threat to the fair remuneration of authors and performers in the music sector and their ability to develop sustainable careers. We therefore firmly condemn this partnership, which relies on the expropriation of music authors and performers from their rights and legitimate revenues. We call on any public or private company to refrain from collaborating with an entity that disrespects authors and performers and their basic economic and moral rights."

  They concluded: "Moreover, we urge all authors and performers in the music sector to carefully consider all the potential consequences of buy-out agreements, whereby all their exclusive rights are transferred in perpetuity against no future revenue. The development of such buy-out malpractices, which do not even give credit to authors and performers,have nothing modern nor innovative.They simply prevent music creators from being paid fairly for the use of their works, which should no longer occur in the 21st century."

Ingrooves unveils AI tool to detect shifts in audience engagement and behaviour

By Emmanuel Legrand

 


Ingrooves Music Group, the Universal Music Group-owned music marketing services and distribution company for the independent sector, has been awarded a United States patent (No. 10,755,291) for its proprietary method of leveraging artificial intelligence (AI) "to detect significant shifts in audience engagement and identify high-value streaming audiences."

  The technology was developed in-house by Ingrooves’s Chief Analytics Officer Dr. SK Sharma and its internal AI team. The invention identifies audiences who have "a high likelihood of deepening their engagement and becoming long-term fans of individual artists."

  “Music consumption generates an enormous trove of data, but it’s only valuable to artists and labels if it can be used to analyse audience behavior and translated into real-time marketing options quickly," explained Dr. Sharma. "This technology helps to grow our artists’ and labels’ audiences by examining exceptionally large datasets at scale and recommending actionable marketing initiatives on the spot.”

A game changer

  The technology has already been integrated within Ingrooves’ Trends Now platform. It will allow to detect key signals of audience engagement and alert labels to growth opportunities for their artists and tracks. Ingrooves said it would embed the technology into a new, proprietary ad-buying solution within the company’s Dispatch marketing platform later this year.

  "This proprietary technology is a ‘gamechanger’ for music marketers and the artists they represent and we’re excited to further integrate it into our platform,” said Ingrooves CEO Bob Roback. “Reflecting years of innovation and investment, this is a huge accomplishment for SK and his team, but it’s only one initiative on our roadmap to revolutionise music marketing for our clients.”

Spotify, Deezer and Epic Games launch the Coalition for App Fairness to challenge Apple's app policy

 By Emmanuel Legrand

A group of thirteen companies active in music, gaming, content distribution and software have joined forces to create the independent non-profit organisation Coalition for App Fairness (CAF), to ensure a level playing field and fairness in the dissemination of applications via app stores such as Apple App Store or Google Play.

 

  “As enforcers, regulators, and legislators around the world investigate Apple for its anti-competitive behavior, The Coalition for App Fairness will be the voice of app and game developers in the effort to protect consumer choice and create a level playing field for all,” said Horacio Gutierrez, Head of Global Affairs and Chief Legal Officer at Spotify. 

 

  The CAF plans to "advocate for enforcement and reforms, including legal and regulatory changes, to preserve consumer choice and a level playing field for app and game developers that rely on app stores and the most popular gatekeeper platforms." It added: "Given the widespread use and importance of apps, it’s essential that all apps can compete fairly in order to drive innovation and ensure that the benefits of digital technologies are enjoyed by everyone."

 

A dangerous new normal

  One of the key issue is Apple's 30% fee applicable on digital products, which is then dropped to 15% after a full year of subscriptions. According to The New York Times's member of the editorial board, Greg Bensinger, the fact that Apple can lower the commission fee "raises the question of how Apple can justify the higher fee if 15% is enough to pay for all the things Apple says it supplies app developers." The newspaper said that while Apple does not disclose its revenues from App Store commissions, estimates put the figure in the $15-19 billion range. A former App Store executive was quoted in The Times saying that, “we’re realising that 30% is way too much,” and that the commission should be closer to 3%.

  “We have come to believe Apple has created a dangerous new normal, allowing it to abuse its monopoly power through punitive fees and censorship that stifles technological progress, creative freedom, and human rights,” said Protonmail CEO Andy Yen.

 

  CAF founding members include: Basecamp, Blix, Blockchain.com, Deezer, Epic Games, the European Publishers Council, Match Group, News Media Europe, Prepear, Protonmail, SkyDemon, Spotify, and Tile. 

 

Adopting fair rules

 

  The organisation has come up with a 10-point manifesto:

  1 - No developer should be required to use an app store exclusively, or to use ancillary services of the app store owner, including payment systems, or to accept other supplementary obligations in order to have access to the app store. 

  2 - No developer should be blocked from the platform or discriminated against based on a developer’s business model, how it delivers content and services, or whether it competes in any way with the app store owner.

  3 -  Every developer should have timely access to the same interoperability interfaces and technical information as the app store owner makes available to its own developers.

  4 -  Every developer should always have access to app stores as long as its app meets fair, objective and nondiscriminatory standards for security, privacy, quality, content, and digital safety. 5 -  A developer’s data should not be used to compete with the developer.

  6 -  Every developer should always have the right to communicate directly with its users through its app for legitimate business purposes.

  7 -  No app store owner or its platform should engage in self-preferencing its own apps or services, or interfere with users’ choice of preferences or defaults.

  8 -  No developer should be required to pay unfair, unreasonable or discriminatory fees or revenue shares, nor be required to sell within its app anything it doesn’t wish to sell, as a condition to gain access to the app store.

  9 -  No app store owner should prohibit third parties from offering competing app stores on the app store owner’s platform, or discourage developers or consumers from using them.

  10 -  All app stores will be transparent about their rules and policies and opportunities for promotion and marketing, apply these consistently and objectively, provide notice of changes, and make available a quick, simple and fair process to resolve disputes.

  CAF members invite stores to "voluntarily choose to adopt and follow similar principles. But we know from experience that self-regulation is not enough and that new laws and regulations are required in this case. The principles serve as a blueprint for modern laws and regulations and the Coalition will advocate for them with governments around the world."

French hi-res streaming platform Qobuz secures €10 million in fresh funds

By Emmanuel Legrand

Qobuz, the French-based high-resolution music streaming and downloading service, has raised €10 million in strategic fundraising from its historic shareholders, the Nabuboto company and the Quebecor Group from Canada. The investment will be used to support the platform's international development. This follows a previous capital increase of €12m in August 2019.

  "We are very proud of our latest fundraising milestone of €10m, which shows our historical shareholders’ confidence in our model,” said Qobuz Chairman and CEO Denis Thébaud. “We are ready to step up our international presence to offer a unique offer to those who do not compromise on musical quality.”

  Thebaud did not disclosed financial details of Qobuz operations but the company said revenues were up 45% in the last fiscal year compared to the year before.

Strengthening its management team

  Qobuz is currently present in 12 countries – in France, where it was launched in 2007, the United Kingdom, Ireland, Germany, Austria, Belgium, Switzerland, Luxembourg, the Netherlands, Spain, Italy, as well as the United States, where it opened a subsidiary in 2019.

  To support its international development, Qobuz has strengthened its management team, with the addition of Georges Fornay, a specialist in the entertainment sector, as Deputy CEO, and Céline Gallon as Chief People Officer. In addition, Raphaël Awóṣéyìn, who has held the position of Head of Quality Assurance at Qobuz for over a year, is appointed Chief Customer Officer. In the US, Rachel Silton has been appointed Acquisition and Marketing Manager.

European Parliament votes a resolution asking for 2% of EU's recovery plan to be allocated to creative sectors

 

By Emmanuel Legrand

 

The European Parliament has voted a resolution that calls on the Commission and European Union Member States "to earmark for the cultural and creative sectors and industries at least 2 % of the Recovery and Resilience Facility dedicated to the recovery."

  This is by far the clearest sign from European policy-makers that they are ready to support the Cultural and Creative Industries (CCI) sectors through a significant influx of funds. The EU recovery package, dubbed Next Generation, EU is of €750 billion, so 2% would equal to some €15 billion for the CCIs. The Parliament said this percentage "should reflect the importance of the cultural and creative sectors and industries to the EU’s GDP," considering that they account for 7.8 million jobs and 4% of GDP.

  The Parliament's resolution was initiated by MEP Laurence Farreng, on behalf of the Renew Group. "This is a strong signal sent to the European Commission and Member States to support the creative and cultural sectors and industries," said Farreng.

 

Revitalisation of Europe's cultural policy

  The Parliament noted that "the post-pandemic recovery and revitalisation of European cultural policy are strictly connected to the other challenges that the European Union and the world are facing, starting with the climate crisis." It considered that it was "fundamental to earmark for the cultural and creative sectors and industries a significant part of the economic recovery measures planned by the European institutions and to combine this with wide-ranging and swift actions in favour of Europe’s cultural and creative forces, enabling them to continue their work in the upcoming months and to survive these times of crisis, and creating resilience in the sector."

  The Parliament also called on the Member States and the Commission "to coordinate their action in their support for the cultural and creative sectors and industries." It also criticised the Commission for failing to allocate additional funding from the Next Generation EU fund to the Creative Europe budget, which has been set at €1.64 billion for 2021-27, and called for the overall budget of Creative EU to be increased to €2.8bn.

  The resolution also points out that recently-adopted legislation such as the Audiovisual Media Services Directive, the Directive on Copyright in the Digital Single Market and the Satellite and Cable Directive, are instruments that should "be transposed as smoothly as possible" in national legislation as they would "promote European cultural content worldwide by encouraging European production and developing European broadcasting networks." These Directives would "both stimulate creation and protect individual creators."

 

Strenghen collective management mechanisms

  The resolution also called on the European Commission "to strengthen collective management mechanisms for the implementation of these directives and future policy."

  Such resolutions are not binding for the Commission but they indicate that should the Commission propose measures that went in the direction wished by the Parliament, they would be approved and voted.

  The vote of the resolution was welcomed by the CCIs. GESAC, the European Group of Societies of Authors and Composers, commended what it called an "important resolution" that "recognises the grave situation facing Europe’s creative and cultural ecosystem and lays out steps that need to be taken for a strong recovery."

  “This resolution is a huge step towards the cultural recovery of Europe," said GESAC’s General Manager Véronique Desbrosses. "It is now time for Member States and the Commission to listen to the EU institution that represents the voice of the European people, and follow the ambitious path laid out in this document."

David Israelite (NMPA): 'I am optimistic about publishing'

In this interview with Emmanuel Legrand, the President and CEO of the Washington, DC-based National Music Publishers' Association, David Israelite, talks about the impact of the Covid-19 crisis on music publishers, recent deals and settlements such as the ones with TikTok or Peloton, the soon-to-be-launched Mechanical Licensing Collective, which should revolutionise the way mechanical royalties are licensed and paid in the US, the review of the ASCAP and BMI consent decrees by the Department of Justice, the CRB rates determination, and the on-going battles to get platforms such as Triller and Twitch licensed for the use of music. This is an edited version of an interview with Synchtank. The full version can be found here.

Let’s start with the State of the Union. What information do you get from your members about navigating Covid?
David Israelite: We’re very concerned about the financial impact of Covid. We only track revenue on a calendar year basis at NMPA, so we won’t get any of the 2020 data until early 2021. But obviously we are collecting anecdotal evidence and there are some clear signs that there is going to be a hit. The question is how big it will be. A lot of the pain is going to be spread out and felt in the future because of the nature of how publishing pays out. Areas that we are particularly concerned about include models that rely on advertising revenue, such as radio and free-to-the-consumer models. We are concerned about general licensing. We are hopeful that subscription revenue is going to be strong as more people feel the need to have a music subscription service. Because the dominant model is subscription-based and not purchase-based, there are actually some benefits as long as people keep their subscriptions. We think there will be strong revenue from that. Another big area of concern is the shut-down of production of movies, television shows and commercials with all the synchronisation money. We won’t know that for some time. But one of the good things about music publishing is that we are a diversified industry with lots of different income streams.

Where do you see growth areas for music publishing in the years to come?
I am actually optimistic about publishing. Obviously we are experiencing the recession from Covid, but overall I think the future is very bright for publishing and songwriting. In the mechanical space, I think we are going to see continued growth in subscription revenue, and it’s going to have a multiplier effect. On the synchronisation side, I think that we are going to see continued growth in social media applications. Through a combination of licensing deals and enforcement actions, you’re going to see a big growth in that area. Those two things combined, I think, could lead to some good growth numbers once we get out of this recession period.

Can you elaborate a little bit more on the TikTok agreement?
Sure, it was two things. Number one, it was a settlement looking backwards and there was a very generous settlement pool that was offered to publishers for music that was not licensed. Then, it was also a looking forward two-year licensing deal. Which again had a generous compensation pool for publishers in exchange for a license going forward for that period. Once that is established, we expect it will be a continuing string as long as the company is in existence. So it was two parts, both of which had significant revenue pools for publishers.

Can you confirm to [Amazon founder and CEO] Jeff Bezos that [Amazon-owned] Twitch is not licensed?
[Laughter] Yes, I can confirm to him that Twitch is not properly licensed across all of its platforms and I can tell you that it is at the very top of our list that we are looking at in terms of how best to proceed with regards to its lack of licensing.

And what about Triller?
Triller is a competitor of TikTok that is mostly unlicensed and I think that, similar to TikTok, Triller is going to have to figure out a way to settle for the past and license for the future, otherwise we’re going to find ourselves in conflict.

Isn’t it interesting that 20 years after Napster, the music industry is still facing the same situation?
It is. It’s incredible that more tech companies haven’t learned the lesson that it’s easier to ask for permission than forgiveness. It’s inexplicable.

Another example where you had to intervene was with Peloton and eventually you prevailed. Can you give more details about that settlement?
Sure. Peloton is a great example of when a company decides to own the mistakes that it’s made and commit itself to being a good business partner. We were able to reach an agreement about how to address the past and with that we were very excited to then partner looking forward because the in-home fitness industry is an enormous source of potential new revenue, especially during COVID. While in public gyms you maybe are limited to just the public performance revenue, which is quite small, once you start producing programming that has music synchronised to it, there’s tremendous value for songwriters and publishers.



Let’s talk about the CRB rate appeal from Spotify, Amazon, and a couple of other platforms, excluding Apple. The appeals courts seems to have gone against your wishes and sent everybody back to the CRB for more discussions. In your comments after the court decision you seemed optimistic. Do you still feel the same now?
I think a lot of people misunderstood what the appellate court did and jumped to conclusions about it. It gets very legal and very technical but at a high level, what the appellate court did was remand back to the CRB a couple of issues which the CRB is now going to have to address. It doesn’t mean that anything has been changed about the ultimate decision. What it means is that the CRB has to address the concerns that were raised by the appellate court on two particular issues. One of which is the second prong of the three prong test about what we call the uncapped TCC. The second issue had to do with the definition of bundling, which is when you marry a music service with a non-music product, and how you charge for the music product. Again, it doesn’t mean that either of the decisions are going to go away. Ultimately, it means that the CRB has to do some work and address those concerns. The most important issue from the previous CRB decision was the 44% rate increase which was the first prong of the three part test and as long as that prong stays intact, these other issues will be much less important.

The irony is that you are sitting side by side with the Spotifys of this world in the MLC. There’s something that doesn’t seem consistent in their relationship with the songwriting and publishing community.
It’s complicated, but I think it’s probably no different than when you have countries that have tensions or conflicts between them and yet there are other areas where there still is interaction between them. We may be in a cold war environment with China, but we still do some trade with them that benefits both countries. I think that the MLC is kind of like the trade in that analogy where we’re definitely in conflict with Spotify and Amazon. They have declared war on songwriters, but at the same time we made a deal to build this MLC with their money and we’ll be professional about it, while at the same time we will defend ourselves against their attacks over what they pay songwriters.

What’s your assessment about what’s been done so far with the MLC? Is it on track?
Yes, I think that [The MLC CEO] Kris Ahrend and his team are doing a fantastic job under difficult circumstances to stay on schedule. I think that people will quickly forget the benefits that were achieved from the MMA, so it’s worth reminding them that this entire infrastructure is being built and funded 100% by the digital companies, which means that songwriters will no longer pay a commission for their mechanical distributions. It’s the first place in the world where a society will collect money and distribute a hundred cents on every dollar, and that the database that is being built will be public. It will be the first public transparent database in the world and in the history of music rights and, again, 100% of that cost being funded by the digital services. So this is all going on with their money and at the same time that we’re fighting over rates, but the MLC is doing a great job and it’s going to be ready to open on January 1st per the law’s mandate.

Do you understand why some people were skeptical when HFA was chosen as the lead vendor when it comes to data? [HFA used to be owned by the NMPA before it was sold to SESAC in 2015, and had been criticised for the quality of its database.]
Oh sure, I think that when the MLC made its decision over choosing a vendor, it was in a difficult position in that I don’t think anybody felt that anyone did a good job with matching. I think the consensus was that while HFA is certainly not perfect, using HFA’s structure as a starting point was going to be better than trying to create a system from the ground up with nothing. What’s different about the MLC from what HFA or MRI or anyone else has done, is that the database that will be the authoritative roadmap of how to pay people is public. It’s transparent.

Another issue is the ASCAP and BMI consent decrees, which are currently being reviewed by the DoJ. Do you think things are going to change?
On the consent decrees, the Department of Justice held a virtual workshop a little over a month ago. We were very pleased that we got to fully participate and make our case for selective withdrawals, and now we’re just waiting for the DoJ to decide how it wants to proceed. I suspect that we’ll have a decision before re-election and we’re optimistic about what might change in the decrees to give more freedoms to songwriters and publishers.

New PRS for Music report shows stream-ripping piracy is rampant in the UK

By Emmanuel Legrand 

The UK music piracy landscape has changed radically over the past five years, with the rise and rise of stream-ripping as the most prevalent way to access pirated music, while BitTorrent sites are becoming less used by consumers, according to a new study carried out by online rights monitoring company INCOPRO for British rights society PRS for Music.

  According to the study, usage of stream-ripping services has "dramatically increased" by 1390% between 2016 and 2019, and is now "overshadowing all other illegal online music activity in the UK." Data used for the research was taken from INCOPRO’s Identify database, consisting of over 17,000 piracy sites based on their estimated use in the UK, and a sample of 100 of the most popular stream-ripping services.

  PRS for Music CEO Andrea C. Martin said the rise of piracy via stream-ripping services has to be put in the current context of the Covid-19 pandemic, since the rise of illegal consumption of music will have an impact on the bottom-line of organisations such as PRS.

Foster a secure digital environment

  “Since this research was conducted," said Martin, "the world has changed beyond what anyone could have imagined due to Covid-19. The prolonged absence of income from live performance means that revenues generated on legitimate digital platforms are more important than ever. While the report shows that our efforts are going in the right direction, it is equally clear that we must persist and continue to work closely with both government and the wider music industry to foster a secure digital environment for music creators and consumers alike.”

  Although stream-ripping services account for 3 of the top 50 piracy websites, according to the study, up 4% from the previous report completed in 2016, they represent an increasing traffic. BitTorrent (15 sites) and Cyberlocker host (17 sites) are still "the most common categories of sites which contain music content." The proxy/other sites (13 sites) category has slightly increased since the previous report.

  Key findings of the report include:
  > Stream-ripping services are found to account for a noticeable proportion of the overall music infringement activity in the UK. Usage of stream-ripping services accounted for 80.2% of the top 50 specifically music infringing sites;

  > The stream-ripping service with the highest usage in the UK, by far, is the site y2mate.com, which accounted for 47% of the combined top 50 specifically music infringing site usage in October 2019. 
  > The legitimate service most abused through stream-ripping is YouTube, both in terms of the number of sites which provide stream-ripping capabilities for the service (80/100 of the sample surveyed) and the percentage of usage that takes place on YouTube specific infringing sites. Spotify is now the second most affected service, overtaking SoundCloud since the 2016 research. Deezer, Amazon Music and Tidal were amongst other popular licensed platforms most targeted. 
  > The main user points of entry to stream-ripping services are found to be direct access to the services’ domain and through search engines, with the exclusion of stream-ripping software, with stream-ripping download sites are directly accessed 69% of the time;
  > Web-based stream-ripping services rely predominately upon advertising for revenue, but stream-ripping apps, stream-ripping plug-ins,and stream-ripping software also include payments as a source of funding.
  > Of 60 stream-ripping services analysed to determine server locations and hosting providers, over half (32) were found to be based in the US. However, the authors of the study warn that this figures may be misleading, "as 25 of the services use the content delivery network Cloudflare, which could mask their true hosting provider’s location, leading to additional challenges for copyright infringement notifications."

Piracy alive and kicking

  “This report shows that music piracy is very much still alive and kicking, and that stream-ripping is now responsible for a mammoth proportion of the overall piracy problem," said Simon Bourn, Head of IP and Litigation at PRS for Music. "Streaming royalties now account for over 20% of our members' income, and the popularity of this illegal activity has a severe and direct impact on the royalties we can collect for them from legitimate services. Each time a stream is ripped, the user is then listening to and consuming that rip outside of the licensed ecosystem."

  Bourn said PRS will use "all possible measures" to prevent the existence of stream-ripping services, "in order to maximise the royalties we collect for our members and to ensure they receive fair remuneration for their work."

  He also expects those involved in the system, including app stores, software and plug-in platforms, ad networks, YouTube and other licensed services, "to play their own parts in preventing these illegal services from stealing music and depriving songwriters, composers and music publishers of their rightful reward."

SPPF calls for a European solution to the situation created by ECJ's ruling

By Emmanuel Legrand 

France's neighbouring rights society SPPF, which represents independent labels, has called on the French Government to find a solution at European level to answer the situation created by the recent ruling by the European Court of Justice (ECJ), stating that performers should be able to collect royalties from the use of their music regardless of their origin.

  The ECJ decision has left French neighbouring rights societies in disarray, as the non-distributable royalties make the bulk of the organisation's cultural funds, and are based mostly on repertoire from the US. French societies do not pay neighbouring rights royalties to the US on the basis that there is no equitable remuneration (performance rights for recordings on radio) in the United States and therefore no reciprocity. Non-distributable sums represent more than €25 million per year for all collective management organisations in France. Per law, they are allocated to cultural funds. For SPPF only, the shutdown should lead to a reduction of nearly 50% of its support budget, which averages €8m a year.

A considerable financial risk

  During SPPF's annual General Assembly, the Sept. 8 ruling took center stage. SPPF noted that it was the wording of the 2006 European Directive on neighboring rights that had not introduced reserve in the form of a reciprocity criterion. "This decision has serious consequences for French producers and artists because it makes it illegal to allocate 100% of non-distributable sums to aid for creation and musical production," noted SPPF in a statement. French societies are also worried that if the ECJ ruling is applied retroactively, it would "pose a considerable risk to the financial situation of neighboring rights societies."

  Following the AGM, SPPF urged the Ministry of Culture and the French Government to take "the necessary and urgent initiatives at European level to repair the consequences of this coming shock for independent production." It added: "The Government has a particular responsibility in this matter because collective management organisations have pursued a policy of support for musical creation in application of a legislative obligation."

  > During the AGM, SPPF members approved the society's accounts for 2019. During the year, SPPF collections amounted to €33.9m, down 4.8% compared to 2018, due to a dispute with another society, SCPP, related to the split of the non-distributable sums from equitable remuneration. "In the absence of a dispute with SCPP, collections would have reached €36.28m," said SPPF. Distribution to members reached €26.83m in 2019, up 11.5% from 2018. Financial advances amounted to €15m, up 22% over 2018. SPPF allocated €8.67 in aid to support 1,110 musical projects, from 305 independent labels.

 

  > During the SPPF AGM, five members have been re-elected to the Board: Nicole Schluss (Derrière Les Planches), Stephan Bourdoiseau (Wagram Music), Vincent Frèrebeau (VF Musiques/Tot Ou Tard), Vivien Gouery (Yotanka), and Julien Godin (Play Two).

TuneCore expands in Brazil and Russia with local teams

 

By Emmanuel Legrand

 

TuneCore, the digital music distribution service provider for independent artists, has opened two new affiliates, TuneCore Russia and TuneCore Brazil. These two countries are the 9th and 10th where TuneCore operates locally.

 

  "Both Russian and Brazilian music markets feature robust local talent, who will now be supported by TuneCore country managers on the ground as well as dedicated local language websites in Russian and Portuguese," said the Believe-owned company, adding that several more openings are planned "in the coming year."

 

  "Both Russia and Brazil are key markets for independent artists, having seen exponential growth in recent years due to the availability of digital music and the accelerated growth of streaming services,” commented Andreea Gleeson, Chief Marketing Officer of TuneCore. “By expanding our local team and localising our website to Russian and Portuguese, we demonstrate our support of artists with dedicated local executives who not only speak the same language as our artists but also live and breathe the same culture.”

 

  Ivan Ivanov has been appointed Head of TuneCore Russia. He will partner with local music aggregator UMA as well as digital music store, Yandex on behalf of TuneCore and its artists. Ivanov most recently worked at YouTube multi-channel network Yoola. Ivanov will report jointly to Gleeson, as well as to Viktoria Siniavskaia, Managing Director Russia, Eastern Europe and META of TuneCore parent Believe.

 

  In Brazil, TuneCore has appointed Bruno Duque to run their local operations. He was Marketing Manager at digital content distributor iMusica. Duque reports to both Gleeson, and Believe Managing Director for Americas Alejandra Olea.

Jake Wisely to be replaced by Jim Selby as Concord's Chief Publishing Executive

 
By Emmanuel Legrand

Jake Wisely (pictured, above), partner and Chief Publishing Executive at independent music company Concord, will join the Board of Directors of Concord on Jan. 1, 2021. He will be replaced as Chief Publishing Executive by current Concord COO Jim Selby, who will report to Concord CEO Scott Pascucci.

  Selby will lead an executive team that includes John Minch (President, International Publishing and executive in charge of Boosey & Hawkes), Kim Frankiewicz (EVP, Worldwide A&R), Duff Berschback (EVP, Business & Legal Affairs), Kent Hoskins (Chief Financial Officer), Brooke Primont (SVP, Sync) and Dana Siegel (SVP, Brand Management and Music Marketing), as well as a team of more than 200 creative and administrative music publishing and shared services employees.

  Said Wisely said: “Since joining Concord in 2016, Jim has been an invaluable member of the team, helping to forge our discipline and culture, focusing on synergies between Concord businesses and maximizing value for all stakeholders. Jim is a consummate music fan, well-versed in our roster and catalog, and will ensure that Concord’s songwriters and composers are diligently served.”

A natural choice

  Added Pascucci: “Jim was a natural choice when deciding who should guide Concord Music Publishing in its continued growth. He knows all areas of the Concord business, is a champion for our artists, songwriters and composers and will transition to Chief Publishing Executive seamlessly over the coming months. I am excited to see our publishing business flourish under his leadership.”

  Wisely will "remain a partner and shareholder in Concord and will maintain an advisory role in the day to day operations of Concord Music Publishing, while also maintaining the company’s Executive Member seat on the NMPA Board of Directors," according to a statement from the company.

  No explanation was given by Concord for these changes. Wisely, who relocated to Nashville from Los Angeles in 2018 after Concord acquired the Imagem catalogue, has overseen the growth of boutique publishing house The Bicycle Music Company, which then merged into Concord Music Publishing and then Imagem to become one of the world’s largest independent music publishing companies.

  Pascucci commented, “Concord would not be what it is today without Jake Wisely and The Bicycle Music Company. Jake was critical to the establishment of Bicycle as a world-class publishing operation, which then became the foundational platform for Concord along with Concord Music Group. Since the combination of those two companies in 2015, Jake has proven himself to be an extraordinary manager and strategic thinker, whose contributions have been invaluable in building the company through new partnerships and investments. I look forward to working with him in his new role as a member of the Concord Board of Directors.”

The European Court of Justice rules that all EU countries must treat performers equally

By Emmanuel Legrand 

In what is described as a landmark decision with far reaching consequences, the European Court of Justice (ECJ) has issued on September 9 a ruling that would force European neighbouring rights societies to remunerate all performers, regarding their country of origin.

  The ECJ was asked to determine whether Irish law was consistent with EU law by excluding certain performers not based in Ireland or in European Economic Area (EEA) countries from the revenues generated by the use of their recordings by Irish radio and TV (equitable remuneration). 

  The legal action was started in Ireland by performers' group Artists Actors Performers (RAAP) against Phonographic Performance Ireland (PPI), the neighbouring rights society which represents producer of recordings, as well as against the Minister for Jobs, Enterprise and Innovation which oversees copyright law in Ireland.

Defining the scope of international treaties

  Neighbouring rights are codified by the EU Directive 2006/115/EC on rental right and lending right and on certain rights related to copyright in the field of intellectual property, and by two international treaties on copyright, the 1961 Rome Convention and the WIPO Performances and Phonograms Treaty of 1996 (WPPT). The USA has not ratified the Rome Convention but is part of the WPPT. However, many European societies do not pay US performers for equitable remuneration due to the lack of reciprocity in the US, which does not have performance rights for the use of sound recordings by radio stations. 

  RAAP was of the opinion that all the royalties should be shared between the phonogram producer and the performer, regardless of their origin. PPI maintained that under the 2006 Copyright Directive, non-EEA performers were not entitled to any share of royalties.

  The case reached the High Court in Ireland, which referred a number of questions to the ECJ, in particular if a national court could interpret the 2006 Directive in relation to the two international treaties, and if it had discretion to determine what constitutes a “relevant performer” under the Directive.

What is the role of Member States?

  The ECJ decided in its ruling to examine together the first and second questions, and determine "in essence, whether Article 8(2) of Directive 2006/115 must, in the light of the Rome Convention and/or the WPPT, be interpreted as precluding a Member State from excluding, when it transposes into its legislation the words ‘relevant performers’ which are contained in that provision and designate the performers entitled to a part of the single equitable remuneration referred to therein, performers who are nationals of States outside the EEA, with the sole exception of those who are domiciled or resident in the EEA and those whose contribution to the phonogram was made in the EEA."

  After consideration of the EU law and the international treaties, the court ruled that:

  1. The law should be interpreted "as precluding a Member State from excluding, when it transposes into its legislation the words ‘relevant performers’ which are contained in Article 8(2) of the directive and designate the performers entitled to a part of the single equitable remuneration referred to therein, performers who are nationals of States outside the European Economic Area (EEA), with the sole exception of those who are domiciled or resident in the EEA and those whose contribution to the phonogram was made in the EEA."

  2. The law should be interpreted as precluding "a Member State from limiting the right to a single equitable remuneration in respect of performers and phonogram producers who are nationals of those third States."

  3. The law "must be interpreted as precluding the right to a single equitable remuneration for which it provides from being limited in such a way that only the producer of the phonogram concerned receives remuneration, and does not share it with the performer who has contributed to that phonogram."

Protecting the economic welfare of performers

  In other words, the Court sided with RAAP in stating that performers cannot be excluded from receiving royalties based on their nationalities. The matter will now go back to the Irish High Court, since it now has the clarification it needed to make a judgment. But it will also force the Irish government to amend the current copyright legislation to comply with the ECJ ruling. Meanwhile, the ruling will be carefully analysed by governments across Europe and at EU level, as well as by neighbouring rights societies in Europe and elsewhere.

  “At a time when the income of so many talented and gifted music professionals has been decimated by the Covid pandemic it is some good news that the European Court of Justice recognises the need to protect the economic welfare of performers," rejoiced RAAP chairman Paddy Cole.

  Unsurprisingly, US neighbouring rights society SoundExchange praised the ECJ’s ruling ordering European Union countries to treat music creators equally regardless of their nationality. SoundExchange has launched a campaign in early 2020 asking to receive "national treatment", in particular in countries like the UK, France or Germany, denying equitable remuneration monies on the grounds that there is not performance right on sound recordings for terrestrial radio in the US.

Advancing the cause of fairness

  "The ruling has broad implications for music creators around the world," said the Washington, DC-based society in a statement. "By adopting the principle of 'national treatment' – that a country should provide foreign entities the same benefits and protections as it would its own citizens – the ECJ is setting the stage for all artists to be paid royalties when their music is played on EU radio broadcasts and public performances."

  SoundExchange President and CEO Michael Huppe said the ruling was "advancing the cause of fairness within the global community of music creators." He added: "We urge EU member states to quickly follow suit so that ALL musicians and labels, from whatever territory, can be properly respected for the benefits they provide beyond their home country."

  The UK's society PPL, which represents over 110,000 performers and record companies, from the UK and from around the world, said it "supports fair payment and protection for sound recordings and performances wherever in the world they are used." PPL noted "with interest" that the CJEU’s decision rules "on when performers qualify for equitable remuneration." PPL said: "The CJEU has given a detailed judgment in a complex case, raising technical legal issues about the decision-making relationship between the EU and its member states. We now wait to see how the judgment will be followed in Ireland, and how other EU member states will react."

An alarming decision for ADAMI

  PPL admitted that in the UK the situation "is further complicated by Brexit" but PPL would "follow whatever UK law prescribes, whether now or in the future." It added: "On behalf of the performers and record companies we represent, we will also continue to support wider efforts to improve the local protection of sound recordings and performances, whether that is within Europe or in other key markets such as the US." 

  The ruling created a commotion in France, where budgets to support creative projects allocated by neighbouring rights societies are mainly financed through the non-distributed royalties from equitable remuneration. ADAMI, which represents performers, said said the ruling was "an alarming decision for the rights of performers" and said it would appeal to Minister of Culture Roselyne Bachelot. "The judges considered that the European collective management organisations must now pay all the artists distributed in the countries of the Union, including those whose phonograms come from countries not signatories of international treaties allowing reciprocity of rights – essentially American artists. A virtuous circle has just been broken, without compensation." 

  ADAMI said that in concrete terms, the decision would translates into a reduction of more than 35% of the budgets devoted to the aid for the creation and the employment of the performers. ADAMI estimated the losses between 12 and 15 million euros per year. 

A financial shock for SPPF

  Jérôme Roger, Director General of SPPF, the French neighbouring rights society representing independent labels, told News Tank that the ECJ's decision could cost the organisation up to 65% of its cultural budget, "If 65% of our support funds were to disappear it would truly be a financial shock for SPPF but mainly for all the independent producers that are members of SPPF," said Roger. 

  Roger also said that the ruling is not specific as to whether it will have a retroactive effect. If such were the case, all four French neighbouring rights societies (SCPP, SPPF, ADAMI and SPEDIDAM) would have to pay millions in back-payments to US performers. Roger said the solution should come from Europe with a necessary clarification of the various Directives. 

  Helen Smith, the executive chair of IMPALA, the Brussels-based organisation representing independent music companies in Europe, told Creative Industries Newsletter that the solution will probably come from the European Union. "There is a lot of white noise about what this case means, but it is not really about national treatment as a principle," she said. 

Mobilise to lobby the Commission

  She added: "It is more about how this particular EU legislation should be interpreted and it wasn't clearly enough drafted. As the court acknowledges, this can be fixed and that's what we would expect member states to ask the EU to do. And obviously this really puts the spotlight on the glaring hole that is the lack of a performance right in the US which is costing musicians and labels millions each year. That’s precisely why restrictions to the principle of national treatment are and always will be an integral part of international copyright rules." 

  A European label source said the issue of reciprocity still remains on the table: "I would expect the member states to mobilise as it’s crazy to imagine that they would allow this to put them in a worse position than third countries under international rules by asking societies in EU members to pay to a country that doesn’t have its own terrestrial right when other non-EU countries don’t have to."