IMPF values the global music publishing sector at $5bn with independent publishers accounting for 27%

IMPF, the Independent Music Publishers International Forum, has released a report penned by Coco Carmona and Ger Hatton documenting the value of the global independent music publishing copyright business in 2019 and 2018. We publish here the Executive Summary of the report, which can be found here. 



This report assembles, for the first time, the global market revenue and percentage share of the independent music publishing industry. It looks at where the industry revenue was at internationally in 2019 and 2018, a view which is critically important given the devastating impact of the Covid pandemic of 2020 (and 2021).

  The report also shows the growth potential of the sector in the wider music market context. The report compiles available information on the music industry and aims to illustrate the value of independent publishing within the music ecosystem. It provides an economic and financial overview of the global industry with the purpose of highlighting indie publisher’s contribution and influence.

Publishing revenues at €5 billion

  As shown here, the total value of the global music copyright business in 2018 was worth €25.52 billion. 61% per cent of this figure, over half of the total, was generated by the recording industry, while music publishers, songwriters, and composers accounted for the remaining 39%. In 2019, the value of music publishing (alone) was estimated at €5 billion globally.

  Independent music publishers within this figure, together represent 27% of that global market share; a rather impressive figure considering that this report classifies “indies” as those companies with a market share of 5%, or less, of the overall music publishing market. The report also reveals that this 27% global figure varies widely according to region, with, for example, independents constituting a remarkable 63% of the publishing market in Japan.

Digital revenues remain low

  When looking at the various revenue streams, TV and radio continue to be the most important sources of income, with performing rights accounting for most of the global music publishing income. Surprisingly, in 2018, digital revenue was below 20% of the global publishing revenue. While this figure is increasing, it is still shockingly low. For instance, though digital revenues account for 80% of the growth in revenues on the recording side, this is not the case in publishing where growth comes mainly from mechanical revenue. Independent music publishers are well aware of this discrepancy and it is something that requires further reflection and action.



  In terms of regions, North America, Europe and Japan are leading the growth curve, but growth is a reality on all continents. While the report shows that it is more difficult to obtain strictly accurate figures in regions such as South America, Africa and parts of Asia, the tendency across the board is similar, and the issue of accuracy in reporting is one which indies will work to ameliorate together with collective management organisations (CMOs). Piracy and corruption continue to be a real problem everywhere, particularly in the African continent and China, and IMPF joins industry colleagues and other rights holders in any efforts to address this threat.



  This report acknowledges the serious and devastating impact of the Covid pandemic on the music industry. Around the world, there has been a wave of cancellations and postponements of live performances, with many, many more to come. This is having a dramatically ill effect on the livelihoods of all those working in, and connected with, the music sector. While some CMOs have ventured to calculate estimated losses, the real impact will only be known, and felt, next year, given the time-line between activity, collection and distribution.

Adapting to changes

  As the case studies included in this report demonstrate, independent music publishers show flexibility, persistence and ability to adapt to change, particularly in these difficult times. During the months following the outbreak of the Covid pandemic, publishers have had time to reflect on how they do business and as entrepreneurs, they have seen and responded to the new licensing opportunities brought on by the worldwide lockdown.

  Streaming and digital services are clearly growing, and indie publishers want to look at ways of ensuring that their own value is fully recognised. The “value gap” continues to be addressed in different regions of the world and it is crucial that policy makers understand that the “safe harbour” regime designed in the early days of the Internet can no longer be used to exempt certain online services from the normal conditions of music licensing. In the EU, the Copyright Directive is in the process of being transposed into national legislation. Efficient and accurate implementation is crucial to ensuring that rights holders are fairly and sufficiently remunerated for the use of their online copyright-protected content.

  However, low levels of digital income – one-fifth of the global music publishing income as shown in this report – are not merely due to “safe harbour” issues, but also due to the way licenses are negotiated, thereby begging the question as to whether the indie music publishing market could in effect be bigger. Rethinking the way streaming licenses are granted is clearly on the table. This is particularly important given the impact of Covid on the music industry. Streaming subscriptions are, as noted previously, on the rise, and yet this growth is largely beneficial to the labels with over 55% of their 2019 revenue coming from streaming services.

Information for policy-makers

  The report shows the value and contribution of independent music publishers to the global music market and provides substantive information, future proofing and guidance for industry, authors and composers, as well as policy and decision makers. It is also vitally important to work together to re-balance the asymmetries between labels and publishers, an asymmetry that has only been exacerbated by Covid.

  As the network and meeting place for independent music publishers globally, IMPF is confident that by working together any challenge can be turned into an opportunity, and this report demonstrates the strength of the independent market. IMPF will continue to assist and connect indie publishers around the world and ever more so in the current climate, and especially in those territories where indies may be sole operators and lack any solid network.

Mark Mulligan (MiDIA Research): 'We are at the end of the beginning of the era of streaming. So what's next?'

 

By Emmanuel Legrand

 

​What will happen to the music industry once music streaming reaches saturation point? MiDIA Research principal Mark Mulligan offered a few avenues for thoughts during his virtual presentation at the Music Tectonics conference titled 'Growth Drivers: What's Next for the Music Business?'.

 

 ​"Streaming will get to a stage of saturation so we need to know what comes next," stated Mulligan from the outset. The market dynamics had been rather positive for the past few years, with the rise of streaming revenues and the strength of the live music sector, bringing growth back to the business. Then "Covid happened and everything needs reassessing," he quipped.

 

  The recorded music sector experienced growth despite the pandemic, but live music is "decimated" and music publishing is "down." "The market is definitely being contracted and that's why we need growth drivers to pick up from this," he said.

 

Finding pockets of growth

 

  Looking at streaming, Mulligan said some markets like Sweden or even the US are starting to reach their peak, so where are the pockets of growth going to come from? "Amazon expanding the marker by getting households back into music with Echo in the kitchen, and at the younger end YouTube has been this successful platform," said Mulligan who suggested that YouTube "may be the best palace to convert [users] to subscription" but also provide consumers with engaging content that can be monetised (more on that later). 

 

  Turning his attention to artists, Mulligan stressed again that the era of the independent artists has started and will go from strength to strength. "What do artists aspire to?," asked Mulligan, taking his cue from a survey conducted by MiDIA. "The whole things about signing [to a label] is not at the front of the mind as to why they do this. Does this mean that for labels this is the end? Not necessarily. Labels still has that stamp of success: I've made it, I've signed to a label!"

 

Tools for artists

  However, for Mulligan, the advent of tools for artists to develop their careers and monetise their music is going to be one of the drivers of growth.

 

  The way people access music is also in a state of flux. Radio may have lost listeners but surveys still show that it remains the first tool for music discovery, although streaming is catching up. "Radio is about contact," he said. "It is programming led, while streaming is consumer led. Not just how do we get more revenue but also make people fall in music more?"

 

  Covid has been a great disrupting agent, one that was not on anyone's plans. To measure the impact of Covid, Mulligan looked at Disney and Live Nation, noting that in one quarter the two companies lost $10 billion in revenues. "The question is: will this spend come back and how quickly?" he asked.

 

  Covid is also changing behaviours and for Mulligan "some will quickly disappear and some will have long term legacy." One of them bound to stay is people spending more time at home and less commuting, which will have an impact on consumption. "Bars, restaurants and venues will have less passing trade and so many can be impacted by this change in how we behave," he explained.

 

Uncharted territory
 

  He is also convinced that the second wave of the pandemic, combined with lockdown, will "coincide with recession," which will impact the music sector. He offered different scenarios, suggesting that global music industry revenues (including, recorded music, publishing, live performances, merchandising and sponsorship), which reached $76.2 billion in 2019, could contract by 30% to $53bn in 2020 as a base scenario, with a mid scenario down 36% to $48.6bn, and a "bear scenario" with revenues down 43% to $43.5bn. "This is uncharted territory and anyone who tells you they know this will work out is lying! You can only have best guesses."

 

 With recession, "people will eat out less, go out less, cancel video or audio subscriptions," according to surveys. When it comes to music, he noted, is will not necessarily mean less consumption, because consumers can "cut their subscriptions and still get a good supply of music." 

 

  On the concert side, Mulligan predicts that it will take longer to get back to normal because a lot of consumers will be reluctant to take risks and go into venues. In the live music sector small venues are the most at risk. "They are not like Live Nation and have no access to financing," he explained. "They rely on grants and many won't make it and many are too small to make a social distancing gigs."

 

  Post lockdown, if small venues shut down, he predicts it will leave "a gaping hole in the live music industry system," and make it harder for new artists to build a career because there will be less venues to play at.

 

Searching for alternative revenues

 

  So what are the alternatives to boost music revenues? Covid has started a wave of livestreaming events and that's a positive for Mulligan. "The technology was ready and there's been a massive amount of innovation for concerts," he said. "The downside is a fragmentation of the scene and various business models."

 

  Consumers used to spend the most money on concerts because it was a scarce commodity. One of the risks with livestreaming is that a lot is given away for free, creating a Napster moment for the live sector. "To give away stuff for free, that's what we did with Napster and took 15 years to educate people back into spending," he said. "We need to work out how we can bring back a sense of premium and scarcity. We need a bit of structure around innovation." Overall, he added, live streamed events need to be a new format, not a poor imitation of another one."

 

  Mulligan suggested that the industry should work towards setting up a proper structure around live with a virtual live circuit. "This is a new format. It is not replacing concerts but it is creating a new stage," he said. He also believes that virtual events could be to live music "what TV is to live sports" and deliver bigger audiences and better ways to monetise them, while creating an "entire new value chain and ecosystem."

 

Monetising fandom

 

  One of the ways for the music sector to increase revenues is to build from fandom, which Mulligan called "the next monetisation frontier."

  "We need to work out a way for artists and fan to build a relationship," said Mulligan who added that artist to fan relationship had been "a collateral damage" because of streaming, which provided an open tap into music, but cut out the relationship between the users of music and artists. "Streaming is diluting fandom by shifting the focus from artists to the utility of always-on music," he explained.

  So he invited the industry to look at Asia and maybe take its cue from the way platform such as Tencent can extract more revenues from fans that just charging for access to music. "There's an amazing amount of stuff going on in Asia," said Mulligan, adding that Tencent makes twice as much revenues from not music directly. "Gaming, Chinese streaming apps, K-pop and Japanese Idol acts all show audience will pay for fandom," he said.

 

The growth of livestreaming

 

  For tech companies, added Mulligan, the next big opportunity would be to provide the tools to develop fandom formats and increase the monetisation of the relationship between fans and artists. Mulligan believes that "livestream will be huge" but there are already lots of companies in this market, while fandom remains a pretty open market.

 

  For Mulligan, YouTube could also deliver increasing revenues through the monetisation of content. "Let's forget all this massive tension between rights holders and YouTube and think about what it is in music eco-system," said Mulligan. "It is the biggest platform and most widely used digital platform to discover music and it generates a large amount of revenue. It is not not just about what YouTube pays but how you can monetise. Music as a format is about four minutes songs and this does not work in the monetisation system. Look at video gamers, they are constantly monetising. A four minute pop song does not have the same opportunity, but when you look as non-Western companies, they have taken a different approach [with YouTube]."

 

Reassessing the use of YouTube

 

  To stay engaged with the audience will also require artists to think and work differently. "It is arrogant to assume that you can stop talking to your audience and expect them to be as engaged as you left them when you are back," said Mulligan, who showed a slide listing how often channels like T-series or Channel KondZilla post new content (18 each in less than a day) versus the main channels of artists such as Justin Bieber or Ed Sheeran (zero new content in two weeks and nine months, respectively). 

 

  "Labels and artist have to think about how they use YouTube. Music can do a better job at monetising YouTube," asserted Mulligan, adding that Asian music channels "have embraced the dynamics of the YouTube music economy in a way that Western ones have not."

 

  A new approach could also come from streaming services, acting more like labels in the discovery and exposure of new talent. Spotify, said Mulligan, has understood that to have a connection with artists is important but his question is, will it make the move "to become what a record label will be tomorrow?" he asked.

 

  "With streaming, we are at the end of the beginning," he concluded. "The next ten years will be about building the house when the past were about building the foundation."

US Department of Justice files antitrust lawsuit targeting Google's monopoly in search

By Emmanuel Legrand

The US Department of Justice, joined by 11 US States, including Texas and Florida, have filed a complaint under Section 2 of the Sherman Act in the US Circuit Court in the District of Columbia, in which it claimed that Alphabet-owned Google has unlawfully maintained monopolies in the markets for general search services, search advertising, and general search text advertising in the United States, via "anti-competitive exclusionary practices."

  “Two decades ago, Google became the darling of Silicon Valley as a scrappy start-up with an innovative way to search the emerging internet. That Google is long gone. The Google of today is a monopoly gatekeeper for the internet,” reads the opening of the filing.

  The DoJ noted that Google is "a monopolist in the general search services, search advertising, and general search text advertising markets. Google aggressively uses its monopoly positions, and the money that flows from them, to continuously foreclose rivals and protect its monopolies.” 

Google must be stopped

  Presenting the case to the press, Associate Deputy Attorney General Ryan Shores said: "Google is a monopoly under traditional antitrust principles and must be stopped. We are asking the court to break Google's grip on search."

  Google intends to fight the lawsuit. Google SVP of Global Affairs Kent Walker, reacted in a blogpost by stating: "Today’s lawsuit by the Department of Justice is deeply flawed. People use Google because they choose to, not because they're forced to, or because they can't find alternatives. This lawsuit would do nothing to help consumers. To the contrary, it would artificially prop up lower-quality search alternatives, raise phone prices, and make it harder for people to get the search services they want to use."

  Scott Cleland, author of the book 'Search And Destroy: Why You Can't Trust Google Inc.', wrote in a blogpost that the DoJ was "wisely not making the case about Google’s discrimination of search results," which were angles that were pursued by the Federal Trade Commission or the European Union's antitrust division, but rather focusing on Google's “anti-competitive and exclusionary” business contractual arrangements. In the former case, Cleland said Google’s antitrust defense are "relatively strongest and most developed," while on the latter, Google’s "good legal defenses are meager." 

A change in government policy

  He elaborated: "By design, this case evidently is constructed not to satisfy a broad variety of complainants and grievances, but to win, and win handily in court, on the most unlawful and harmful, 'anti-competitive and exclusionary' parts of their core search and search advertising businesses that comprise over 80% of Google’s revenues and most all of Google profits and market valuation."

  For Sally Hubbard, director of enforcement strategy at antitrust nonprofit the Open Markets Institute, the lawsuit reflects a change in the antitrust dogma that dominated at the DoJ in the past years. “It’s a major, major change in the government’s orientation toward monopoly power," she said in an interview in Recode. 

  The outcome of the case will be srutinised by all sides, from tech companies, in particular Amazon and Apple, but also by civil rights movement and rights holders. "US v. Google has the potential to be as significant as the Microsoft case and follows a similar argument," wrote Austin, Texas-based lawyer Chris Castle in a blogpost.

CD Baby music publishing collections exceed $10m

 

By Emmanuel Legrand

 

CD Baby, the service company for independent musician, said it has collected over $10 million in music publishing royalties on behalf of its songwriters clients since it introduced the service a couple of years ago. CD Baby Pro Publishing manages over 1.7 million songs out of the 9 millions tracks from the 950,000 artists it represents.
 

  CD Baby Pro Publishing is powered by sister company Songtrust, both part of music group Downtown Holdings. CD Baby and Songtrust said they have tailored their services to provide independent and self-managed artists and songwriters "to collect all publishing revenues earned by their work, something remarkably difficult for a music creator in the past." Songtrust claims to collect from more than 215 countries and territories, making it the "largest open-access royalty collection network in the industry."
 

  “It is extremely important to be collecting all income sources as an independent artist, especially if you write or compose your own music,” explained Jon Bahr, VP of Business Development & Licensing at CD Baby. “The time has come for all artists, no matter what their career stage, fanbase or geographic market, to get paid promptly and fairly for their work.”

 

Collect what songwriters are owed

 

  Bahr added: “Publishing is complicated, fractured, granular and global. As our hundreds of thousands of songwriters from dozens of countries know, CD Baby Publishing allows them to focus on their music and career growth while we proactively collect what they’re owed.”
 

  Bahr said that in views of the changes in the music publishing landscape in the United States, with the launch of the Mechaical Licensing Collective in 2021, CD Baby’s expertise will ensure that independent songwriters will be able to colelct their mechanical royalties.
 

  “In 2021, with the launch of the MLC in the United States, CD Baby Publishing’s songs will already be registered and earning, as we continue educating the tens of thousands of unpublished songwriters on the value of collecting every penny of song royalties” said Bahr.

Quincy Jones is an investor in AI music start-up Musimap

By Emmanuel Legrand 

Composer, producer and entrepreneur Quincy Jones has become an investor in Belgium-based "emotional" Artificial Intelligence company Musimap. Details of the transaction have not been disclosed. Jones will also become a special adviser to Musimap, utilising his industry standing "to foster relationships and help the business grow."  

  In addition, Andreas Spechtler, the CEO and founder of Silicon Castles and former President of Dolby International, has also become an investor in Musimap and will be joining its board of directors. Investment fund and start-up accelerator LeanSquare is also investing in Musimap.

  For Spechtler, Musimap has "married deep music metadata with other relevant data in their unique AI engine to serve the entertainment markets and beyond. Musimap will support all markets where emotions are key for consumer behaviour like in e-Commerce, dating and advertising.”

A tremendous potential

  Musimap said Jones made the decision to invest in the company after he tested its psycho-emotional profiling engine, MusiMe, which builds emotional profiles for listeners, detailing mood, feelings and values based on their listening history. “I’m incredibly impressed by Musimap’s technology and am delighted to be able to help them grow with this investment," said Jones. "I was pleasantly surprised by how accurate my personality profile was when testing MusiMe, and it’s apparent that the product has a tremendous amount of potential.”

  Jones, who produced Michael Jackson's album 'Thriller', is no stranger in investing in new technologies as he invested early on in Spotify and in piano-learning software Playground Sessions. He is also the founder of Qwest TV, offering high-definition streams of concerts and musical documentaries.

  “We are delighted that Quincy Jones has shown such an interest and enthusiasm for Musimap and our products," said Musimap Managing Director, Patrick Zucchetta. "We are looking forward to working with him and learning from the expertise he and his team will provide.” 

Emotional and contextual data

  Musimap claims to have developed "the largest AI-powered emotion-sensitive music database to date, having analysed and manually annotated one million songs to form the backbone of its recommendation system." Its technology automatically generates emotional and contextual metadata, personality profiles and emotional states of mind based on music consumption. 

  Musimap is a member of music standards organisation DDEX and its clients include Universal Music Group, Vevo, BMG Production Music and MotionElements.

Short-form entertainment service Quibi closes six month after it launched

By Emmanuel Legrand

The founders of short-form content platform Quibi have decided to cut their losses and have shut down the service, just six month after its launch. Hollywood executive Jeffrey Katzenberg and former HP CEO Meg Whitman, the co-founders of the service, announced the decision in a letter to "employees, investors, and partners who believed in Quibi and made this business possible."

  They wrote: "Quibi was a big idea and there was no one who wanted to make a success of it more than we did. Our failure was not for lack of trying; we’ve considered and exhausted every option available to us. While the result was not what any of us wanted, we did accomplish a number of things and we are very proud of what the talented Quibi team has built with the blood, sweat, and tears that they poured into this business over these past two years."

A difficult decision

  Katzenberg and Whitman raised $1.75 million ahead of the launch in April 2020. Quibi projected over 7 million subscribers in its first year, but it only had about 500,000 subscribers paying $4.99 a month, as of a few weeks ago, according to CNBC. The company was not bleeding cash, but the co-founders decided to stop before they reached that point.

  “While we have enough capital to continue operating for a significant period of time, we made the difficult decision to wind down the business, return cash to our shareholders, and say goodbye to our talented colleagues with grace,” Whitman said. “We continue to believe that there is an attractive market for premium, short-form content. Over the coming months we will be working hard to find buyers for these valuable assets who can leverage them to their full potential.”

Launching during a pandemic

  They added in their letter that Quibi was not succeeding "for one of two reasons: because the idea itself wasn’t strong enough to justify a standalone streaming service or because of our timing. Unfortunately, we will never know but we suspect it’s been a combination of the two. The circumstances of launching during a pandemic is something we could have never imagined but other businesses have faced these unprecedented challenges and have found their way through it. We were not able to do so."

  The service promised entertainment and news content packaged in 10-minute maximum, reflecting the era. However, even with the appeal of personalities such as Chrissy Teigen and Idris Elba, not enough subscribers found the content compelling enough to justify the subscription.

  Investors in Quibi included Disney, Comcast’s NBCUniversal, and AT&T’s WarnerMedia. 

British Parliament launches inquiry into the economy of music streaming and its impact on artists and labels

 
By Emmanuel Legrand

The British Parliament has launched an inquiry into the business model of music streaming to determine if the current system allows for artists, songwriters and musicians to be properly compensated for the music streamed on services such as Spotify, Apple Music, Google Play and Amazon Music.

  Julian Knight (pictured, below), chair of the House Of Commons' committee on Digital, Culture, Media & Sport (DCMS), said the the Parliament will be looking into "whether the business models used by major streaming platforms are fair to the writers and performers who provide the material. Longer-term we're looking at whether the economics of streaming could in future limit the range of artists and music that we're all able to enjoy today."



  He added that the DCMS committee will also look into the impact of streaming on emerging careers. "Algorithms might benefit platforms in maximising income from streaming but they are a blunt tool to operate in a creative industry with emerging talent risking failing the first hurdle," said Knight.

  The DCMS committee said that music streaming in the UK brings in more than £1 billion in revenue with 114 billion music streams registered in the last year. However, the DCMS also noted that "artists can be paid as little as 13% of the income generated."

Consider actions against piracy

  The inquiry will "examine what economic impact music streaming is having on artists, record labels and the sustainability of the wider music industry" and is scheduled to start in November. The Committee will also consider "whether the government should be taking action to protect the industry from piracy in the wake of steps taken by the EU on copyright and intellectual property rights."

  This latter point brings back into the UK debate the European Union's Copyright Directive, which introduced via Article 17 the need for platforms to make "best efforts" to properly license content. The British government said that in the wake of Brexit, the UK will not be bound by EU law and decided not to transpose the Copyright Directive into UK law.

Seeking comments from all parties

  The inquiry is seeking the perspectives of industry experts, artists and record labels as well as streaming platforms themselves. Interested parties are invited to answer before November 16 the following questions:

  > What are the dominant business models of platforms that offer music streaming as a service?

  > Have new features associated with streaming platforms, such as algorithmic curation of music or company playlists, influenced consumer habits, tastes, etc?

  > What has been the economic impact and long-term implications of streaming on the music industry, including for artists, record labels, record shops, etc?

  > How can the Government protect the industry from knock-on effects, such as increased piracy of music? 

  > Does the UK need an equivalent of the Copyright Directive? 

  > Do alternative business models exist?

  > How can policy favour more equitable business models?

A more equitable model

  The decision from the DCMS committee to launch an inquiry into music streaming is the culmination of the #BrokenRecord and #FixStreaming campaigns launched by musician Tom Gray, with the support of the Musicians' Union and The Ivors Academy, which regroups songwriters and composers. A petition calling for a Government review secured over 17,000 signatures.

  “It is extremely welcome that the DCMS Select Committee has announced an inquiry into the economics of music streaming at a time when musicians are making very little money from live performance due to Covid-19," said Naomi Pohl, MU Deputy General Secretary, who added that the current crisis "has highlighted that the royalties generated by streaming are far too low and the market is failing the vast majority of our members." Pohl said she hoped the inquiry will show that "a more equitable model is possible and that streaming royalties can and should play a significant role in sustaining the careers of creators and artists.”

  For Graham Davies, Chief Executive of the Ivors Academy, most creators "cannot make a living from streaming, it simply does not pay enough and millions of pounds each year is not properly allocated due to poor data. Following our campaigning with the Musicians’ Union, performers and creators to Fix Streaming this is an opportunity to create a transparent, fair and equitable approach.” 

The vital role of labels

  Geoff Taylor, chief executive of the BPI, which regroups major record companies and indie labels, said he welcomed "the opportunity presented by the DCMS Select Committee to examine the impact of streaming on the music industry, including the vital role labels play as the leading investors into new music, to the benefit of fans and the whole music ecosystem."

  The DCMS announcement came a few days after a YouGov survey commissioned by #BrokenRecord campaign, in association with the Musicians’ Union and The Ivors Academy, showed that a large majority of consumers believe the share received by creators and performers from digital music streaming is unfair.

 

 

  The YouGov survey, based on a nationally representative sample of over 2,000 British adults, also indicated that British consumers were not adverse to an increase in streaming subscription rates if they knew performers and songwriters received a fairer share of the revenues.

  “These statistics show, inarguably, that consumers want a fairer share of streaming income to go to artists, songwriters and musicians. The system is unethical and unsustainable and needs to be sorted out by the industry or, if necessary, via Government intervention," said songwriter and artist Tom Gray, who launched the #BrokenRecord campaign and noted that part of the problem was that streaming services such as Spotify had not increased their rates in a decade.

Songwriters are underpaid

  Key findings from the survey include:
  > 77% of the people surveyed said artists are not paid enough.
  > 76% believed songwriters were underpaid. 
  > 81% would like session musicians to receive some share of streaming revenue.
  > 83% were of the opinion that most record labels are receiving a too large piece of revenues. 
  > 68% claimed the streaming platforms are take a too big share of revenues. 
  > 69% of consumers surveyed responded negatively when asked if they’d be willing to pay more for their streaming subscription under the current distribution model.
  > However, of those who said no, approximately half said they would pay more if their subscription went directly to songwriters and artists they listened to.

Need for a dramatic reinvention

  For the #BrokenRecord campaign, the results of the survey shows consumers "would prefer their subscriptions to be distributed differently and, were it to be reformed, an increasing amount would be willing to pay more for their service."

  The Ivors Academy welcomed the results, which show that consumers would embrace changes in the music streaming business models if it included a fairer remuneration of creators. “What music now needs is a dramatic reinvention of the outdated manufacturing business models that still prevail," said Ivors Academy chair Crispin Hunt (pictured, above).

  "Everyone in the music industry knows that streaming does not currently sustain the careers of most creators. Put simply, not enough of the streaming money paid by the consumer is trickling down to the creators who drive the value. As this YouGov poll makes clear, consumers thankfully agree.”

IFPI and WIN's repertoire data exchange service RDx is now 'fully operational'

 By Emmanuel Legrand

The global repertoire data exchange service (RDx), the joint venture between the International Federation of the Phonographic Industry (IFPI) and the Worldwide Independent Network (WIN), is now "fully operational."

 

  RDx's goal is to provide a supply chain for performance rights data among record companies and music licensing companies (MLCs) "to help improve the accuracy of revenue distribution to rights holders when their music is used." RDx is designed to bring simplicity, standards and efficiency to the exchange of data between rights holders and MLCs on a global basis.

  Following a request for proposals in 2018 and a competitive tendering process, IFPI and WIN chose British neighbouring rights society PPL to develop and operate the technology systems on behalf of Repertoire Data Exchange Limited.

 

Simplifying data-handling processes

  RDx aims at standardising data delivery processes to supply data to individual MLCs around the world, in order to boost the efficiency of information flows. According to the two partners, RDx "simplifies the data-handling process by offering recording rights holders, of all sizes and from any country, a single registration point to supply their repertoire data in a standardised format (DDEX RDR) that can be quickly and easily accessed by participating MLCs."

  The RDR message requires a valid ISRC to identify the Sound Recording being messaged about. A single registration point can "improve the timeliness, accuracy and efficiency of MLCs’ revenue distributions to rights holders worldwide. and provides mechanisms for increasing data quality and automatically alerting rights holders when potential rights conflicts are detected." 

  RDx is expected to "substantially simplify" the delivery by independent record companies of their repertoire and rights data to music licensing companies around the world, explained Charlie Phillips, Chief Operating Officer at WIN. He added: “WIN has long advocated for the benefits of a ‘global single point of entry’ for performance rights data, available to all right holders and MLCs. The 50:50 joint venture between WIN and IFPI has delivered on this objective, with the initial participants in the project having now set up RDx for all other right holders and MLCs to join from now.”

 

Over 1.4 million registrations

   For the past 12 months, PPL has been implementing and testing the systems, followed by a soft launch during which record labels got to use the system, including Beggars Group, Sony Music, state51 Music Group (read below the comments from state51's Paul Sanders on the benefits of the new system for indie labels), Universal Music Group and Warner Music Group. 

 

  The service is now live and exchanging production data between the participating parties. To date, there were over 1.4 million registrations of repertoire data from labels partner that have been processed by RDx.

  Neighbouring rights' collective management organisations receiving production data from RDx include GRAMEX in Finland, PPL in the UK, Re:Sound in Canada and SENA in the Netherlands. Additional record companies and MLCs will join RDx in the coming months.

 

An innovative and transformative project

  “Music companies have made it a priority to invest in and develop systems for music data to be accurately managed and reported. Now live and available worldwide, RDx will significantly contribute to this aim," said IFPI Chief Executive Frances Moore. "The addition of more and more record companies and MLCs will drive further operational efficiency and cost reduction for music right holders whilst also enabling MLCs to retrieve authoritative repertoire data from a single point – further enhancing the speed of accurate revenue distribution.”    

  Peter Leathem, Chief Executive of PPL, said the project was "innovative and transformative" for the recorded music sector. He added: "As a user of RDx, PPL has already begun to see the benefits of improved standardisation and quality of repertoire data, and the automation and efficiency that RDx enables.”


Paul Sanders (state51 Music Group): 'A more accurate and efficient system'
 

Paul Sanders, founder of state51 Music Group, which includes of music platform OpenIMP, digital music distributor and services company Consolidated Independent, and a recorded music division, The state51 Conspiracy, explains here what will be the impact of the RDx initiative for independent labels.

 

The issues had been obvious for a long time: Most MLCs operate their own repertoire databases and ask for registrations direct from producers. That means massive duplication of effort into a very heterogeneous environment, and then little pockets of chaos when rights change hands or mistakes have been made.

  Independent producers were, and still are, very badly affected by this, particularly when their recordings are played outside their home territories. Monitoring and distribution rules are a whole other can of worms, of course, but if as a small and under-resourced producer you can’t get your recordings in the database in the first place you have lost before you start.

  The agencies that represent independent producers are some help, but naturally take a top down approach so there is almost certainly a layer of independent repertoire that is uncompensated. 

 

A collaborative spirit

  Right at the start of the process that led to RDx, I was asked to attend an IFPI meeting at which the subject of repertoire registration and updates was discussed. Richard Gooch [Chief Technology Officer] at IFPI was proposing a short report be commissioned but needed some rights owner involvement to justify it. I offered to pay independent market share of the cost — by distribution of course, not by ownership. The report was written and discussed. 

  We then hosted two large workshops at The state51 Conspiracy’s lovely building in East London, to get some of the technical and operational issues discussed and worked out with people from the major labels and large MLCs. There was an amazingly collaborative and constructive spirit. If only more music industry projects worked like that!

  Out of it came the RFI/RFP process, and we were of course delighted that PPL won the contract. 

 

Feedings data to MLCs

  Simultaneously we were involved in a lot of DDEX working group activity to align the old MLC internal data exchange protocol to the rest of the DDEX standards, as it was a bit of an alien due to its different origins. The principle is of course that the producers send DDEX RDR (the updated DDEX MLC format) metadata to RDx where it is deconflicted and checked before being fed on to as many MLCs as have been brought into the system. 

  So the next phase for us was to bring the state51 Music Group’s technical platform — which we brand OpenIMP — up to DDEX RDR compliance. It’s not easy moving from a product-centered world to one built around the sound recording asset, so that took a bit of effort. We completed that work at the beginning of 2020, and validated Consolidated Independent — our platform services company — as a multi-party data supplier to RDx. 

  The state51 Conspiracy is a producer member of many MLCs, and we have another company in the group — Open Music Rights — that is an agency member of many MLCs too. So we cover our own recordings, can represent other rights owners, and can provide the technical service for other MLC members. 

 

A more reliable set of data

  So what does this project means for an indie label and what are the pros and cons? The implications for indie labels right now are a bit limited as few MLCs are involved. But even at this stage if your local MLC is using RDx you have a stable and well managed metadata format and some infrastructure which means repertoire can be registered and maintained reliably and at much lower cost than before.

  The DDEX consortium and team have been outstanding — and together we have removed the threat of supply chain competition from the commercial market, to the great benefit of independent producers. The same will now happen for public performance and broadcast, and of course this will have implications for private copying levy distributions too, as better coverage seeps into the systems. 

  The next phase will be even more interesting, as it seems to me that international repertoire data flows are likely to improve dramatically, and so international royalty flows should follow suit. There’s a big gap between the ex-home territory earning in streaming, for instance, versus public performance, even though we know a huge amount of international repertoire is played in public via the consumer services. 

 

Transparency and efficiency

  It might be that more independent producers find it possible to join MLCs outside their home territory. Whether they do or not, the international collections via MLC mandates and agency agreements will be more accurate and more efficient. 

  This, by the way, is a huge credit to the major labels, which should be thanked for seeking accuracy and fairness as well as efficiency, when many would say they had been beneficiaries of the inefficiencies. 

  There is another aspect to this, which is that as more MLCs move to RDx, the whole system will become more transparent and more efficient. Naturally MLCs serve their members, who tend in smaller markets to be local producers, and we know some struggle to invest in systems that would make their markets more open.

 

Impact on smaller markets

  RDx is highly likely to have a secondary effect particularly in these smaller markets, which I expect to start clustering around shared technical systems and processes. This of course means that local producers in small markets will find it much easier to register and collect in the larger markets. Anything that gives musicians access to bigger and more efficient markets is very welcome! 

  What are the cons? Well, all this requires investment from small independent producers in processes and in data management. And RDx does not address monitoring and distribution rules, areas where smaller independent producers are still at a huge disadvantage.

TikTok inks multi-year licensing deal with Dutch society BUMA/STEMRA

 
By Emmanuel Legrand

Short-form mobile video app TikTok has signed a multi-year licensing deal with Dutch collecting society BUMA/STEMRA. This is the first of such deal with an important European rights society. Sources at TikTok said other similar deals as the one with BUMA/STEMRA are in the pipeline.

  According to the deal, songwriters, composers and publishers represented by BUMA/STEMRA will be able to receive a remuneration when their  repertoire is played on TikTok. Bernard Kobes, CEO of BUMA/STEMRA said the negotiations with TikTok were "intense but constructive."

Explore creativity

  The two parties said the agreement "builds on the previous relationship between both organisations." As part of the partnership deal, the team at TikTok "will work with BUMA/STEMRA’s members to deepen understanding of the platform and the opportunities it presents to those creating and also performing music."

  “This deal with BUMA/STEMRA secures royalty payments to the Dutch song-writing and publishing community and underlines TikTok's commitment to paying creators when their music is used," said Ole Obermann Global Head of Music at TikTok. "Through our platform, a global audience can appreciate and explore their own creativity, using the musical talent of renowned producers, DJs and songwriters from The Netherlands. I'm delighted we've built on our existing relationship and put this multi-year deal in place."

Good news for authors and publishers

  Kobes said the agreement was "good news for our authors and publishers, especially in these days where our members income has diminished in other markets. We look forward developing this partnership deal further with TikTok and our members."

  TikTok has agreement in place with the three majors record companies (Sony Music Entertainment, Universal Music Group and Warner Music Group) as well as with independent labels' agency Merlin, but so far only few deals with rights societies have been announced.

  TikTok recently announced 100 million monthly active users in Europe in addition to a similar number in the United States. The app has been banned in India and is facing an executive order from President Trump to prevent the Bytedance-owned company to operate in the USA if it continues to stay under Chinese ownership.

Australia's APRA AMCOS feels the impact of Covid-19

By Emmanuel Legrand

Australia's music rights society APRA AMCOS has reported A$474.5 million (€286.6 million) in revenues for the 2019-2020 fiscal year, slightly downgraded from original projections due to the Covid-19 pandemic and the impact of bushfires on the country's economic activity. The society distributed A$407.3m to songwriters, publishers, affiliated societies and rights holders, down 0.9% year-on-year.

  "Individual and collective resilience has been tested and we’ve had to adapt quickly,” said APRA AMCOS CEO Dean Ormston. "As the bushfires devastated enormous areas of Australia, and then Covid-19 spread across the globe, we moved quickly to provide direct support and advocate to government the plight of those that live and work in the original gig economy."

Take a hit in 2020-21

  The society said the 0.6% increase in revenues from the year prior "was down A$14.4m on the budgeted figure of A$488.9m," and that music royalties are expected to "take a more substantial hit in 2020-21" due to on-going restrictions on live music, concerts and touring. "Diverse revenue streams from the licensing side of APRA AMCOS’ business, bolstered by the continued strength of digital, helped to weather the ongoing storm," said the society.

  Public performance income (including live music and concerts) was the hardest hit revenue category with A$73m of income, down from the previous year’s A$92.4m. Digital revenue reached A$206m, up 17.4% year-on-year, and accounted for 43.4% of APRA AMCOS income. "Multi-territory digital licensing saw phenomenal growth in the Asian market as more than one trillion music uses were processed on behalf of rights holders," said APRA AMCOS.

International success

  International income reached A$54.4m, the society's highest annual amount ever, on the back of the of the global success of homegrown artists such as Tones And I, Jawsh 685, Joel Little, Sia, 5 Seconds of Summer and Kevin Parker’s Tame Impala. "The natural timing in international earnings means that the revenue impact of the pandemic – which has been mirrored across the world – will not be felt until FY2021," said the society.

  Looking at the year ahead, Ormston said music will be a critical part of the social, cultural and economic recovery of both Australia and New Zealand" and called for the government "to fully realise the economic, cultural and social return of the music sector. Our music industry is, by definition, a fast-moving, dynamic, agile, locally invested and globally facing industry. Now more than ever there is an opportunity to redefine and build the local and international opportunity for the local music industry, based on an integrated whole-of-government approach that fully reflects music’s impact across society."

> This year’s APRA and AMCOS annual general meetings (AGMs) will be held virtually on Wednesday 18 November 2020, due to on-going Covid-19 restrictions. Voting for the election of directors to the APRA and AMCOS Boards will once again be conducted prior to the AGMs and will close at 5pm on Wednesday 11 November. The results of the election will be announced at the virtual AGMs on Wednesday 18 November 2020 and published on the APRA AMCOS website.