The MLC has received over $424 million in unmatched royalties from 20 DSPs

By Emmanuel Legrand

The MLC has a riches problem: It has been handed $424 million by music streaming services, and it now needs to find the rightful beneficiaries of these unpaid royalties.

  Last week the Mechanical Licensing Collective (The MLC) – which started on January 1, 2021 to licensed and administer mechanical rights in the USA for the online use of music on behalf of songwriters and publishers – said it has received a total of $424,384,787 in accrued historical unmatched royalties from a total of 20 digital service providers (DSPs).

  The package came with together with corresponding data reports that identify the usage related to these royalties: 1,800 data files, which contain in excess of 1.3 terabytes and nine billion lines of data.

Months-long efforts

  The amount transferred by each DSPs matches more or less their market share.  It goes from Apple ($163.3m) to Pacemaker ($278). It is led by Apple Music, Spotifyand AmazonMusic, the three of them accounting for 84.4% of the total. The amount does not include money previously paid out in multiple settlements.

  The transfer of money and data was required by the Music Modernisation Act. DSPs had until February 15, 2021 to transfer all accrued royalties for unmatched uses of musical works that occurred prior to January 1, 2021. It was one of the conditions of eligibility for a specified limitation on liability for prior infringements.

  For The MLC, the transfer of these monies "represents the culmination of a months-long effort on the part of The MLC and these DSPs to develop and implement the specifications for these usage reports." The MLC said it will begin the process of reviewing and analysing the data in order to identify and pay the proper copyright owners.

A massive win for songwriters

  Reacting to the announcement, David Israelite, President & CEO of the National Music Publishers' Association (NMPA), said in an op-ed published by Billboard that while unmatched money "has plagued the music industry not only because money wasn’t being paid out, but also because the services wouldn’t divulge the scope of how much they were holding on to," now "that once elusive amount [...] can make its way to its rightful owners."

  The transfer of the sums to The MLC, according to Israelite, "proves how broken the system was" and is "a massive win for music creators and also reveals a great deal about the streaming services themselves, most notably, how much they needed the MMA as well."

  He noted that the $424m turned out to be "on the high end of reported estimates, while still falling short of the rampant rumours spread by third parties with something to gain by inflated falsehoods."

Mountains of matching

  Israelite added: "The actual number exposes several realities, most notably that streaming services should have been doing a much better job at finding copyright owners, and now we know why they were so reluctant to say just how much they were keeping."

  As far as matching in concerned, Israelite said he was convinced that the MLC "will do mountains of matching on its own," but he added that "it is also up to every copyright owner to delve into the portal once it’s launched and claim what is theirs. The good news is there is time. The MLC is working on making this information public and it rightfully decided to extend the matching period to liquidate the money from the law’s minimum of 18 months to three full years, giving copyright owners even longer to act."

  "Do not let anyone tell you that this is some great victory by the lobbyists–this is a great victory by the lobbyists for Big Tech. They are paying us with our own money through a pig in a poke. If our lobbyists are going to celebrate anything, they need to celebrate when every penny is accounted for and paid to the right person," wrote songwriter and performer David Lowery (Cracker, Camper van Beethoven) on his Trichordist blog.

Keeping pressure on the MLC

  For Lowery, the "hot potato" is now with the MLC, with the task to identify the songs and distribute the royalties. "But all in all," he concluded, "a potentially good day provided that money immediately begins flowing to songwriters. There’s a long way between here and there, but keeping pressure on will keep attention on that juicy target."

  The Artist Rights Alliance said it was an "historic transfer" of unmatched royalties and "a great start," but the organisation added, "There’s a lot of work still to be done to get that money to the songwriters that earned it. We are grateful to the Copyright Office team that skillfully and doggedly worked through a number of complex issues in the months leading up this transfer, including major disagreements about the proper treatment of past industry settlements.

  The ARA said that in the months ahead, it will engage further with the Office "about efforts by publishers who have already been paid for historical usages via settlement agreements to seek double payment out of these new funds." For the ARA, the major publishers that already settled with digital services and received payment from them "should not be allowed to claim a further share of the monies transferred to The MLC today."

  Going forward, The MLC said it would provide additional information about historical unmatched royalties on a newly-created page on its website entitled 'Historical Unmatched Royalties'.

[Commentary:
Few businesses start their first operating weeks by being handed a piggy bank of over $424 million. So it must feel good to be at the MLC at the moment.
  That's the easy part. The problems start now.
  The first issue is the source of the money: these are sums for the use of songs that have not been identified by platforms over the years. So the follow-up question must be: Is that all? How can the MLC make sure that all the royalties have been accrued?
  The estimated figure for the so-called "black box" of unidentified and unpaid mechanical royalties was in the region of $1.5 billion, a figure that was circulated by Jeff Price of Audiam, but hard to confirm. Austin, Texas-based lawyer Chris Castle surmises that the full amount of unpaid royalties is probably in between the two figures.
  (As an aside, it is still fascinating to see that streaming platforms, three of them belonging to three of the biggest tech companies in the world — Amazon, Apple and Google — did not manage to get systems in place internally to deal with these issues. They got away with NOIs and the fact that they have not been held accountable for holding money that should have been paid to rights holders without paying penalties is just shameful. It's another $424m that they should be putting into the MLC's box, just for compensation.)
  So now, who is going to go on a fishing expedition to ensure that platforms have indeed paid all the backlog related to unidentified songs? The NMPA? The MLC? The Copyright Office? Is Congress, which has voted for the Music Modernisation Act that created the MLC, going to investigate?
  The second point is a crucial one for the future of the MLC: ensuring that it manages to match as many as possible of these unidentified songs and pay the rightful owners. The best result possible would be that there would only be a small amount to be put in the "to share" box at the end of the process.
  Ensuring proper matching will be the most important stress-test for the newly-created MLC. And one that will be scrutinised by armies of songwriters and publishers in the US and abroad, as surely there must be a good share of this money that was generated by non-US repertoire.
  There are too many assumptions going around that the royalties will not go to their rightful owners, so it is of the utmost importance for the MLC to succeed in matching the highest volume of songs possible in order to appease everyone and put to rest accusations that the MLC has been built by and for the big publishing companies.
  This is just the start of the journey.

Emmanuel Legrand]

CISAC gives global push to grassroots campaign on copyright buyouts affecting mostly AV music composers

 

By Emmanuel Legrand

The 'Your Music Your Future' campaign to alert and inform creators about the growing practice of copyright buyouts, is getting a global push with the involvement of CISAC, the International Confederation of Societies of Authors, and a new online resource, 'Your Music Your Future International'. The initiative is also supported by CIAM, the International Council of Music Creators.

  The campaign, which was first launched in the USA in 2019, was created by American composer Joel Beckerman, who told Creative Industries Newsletter that the mouvement was a reflection of his own experience. Working as a composer for audiovisual products, he started in advertising, then went on to score music for documentaries, TV shows and films. The payment was usually a fee, which "did not always amount to much" and performance royalties when the shows or films got played on TV. 

  "The nature of the business of writing music for audiovisual means that the only remuneration that we have is from the upfront fees, which have been going down over the years, and the royalties," he explained. "It is impossible to make a living without our royalty income. And if a film is successful, we have the opportunity to earn a fair share of that success." 

Reap the benefit over time

  What he noted over the years was that while the number of channels, networks and online streaming services were growing, composers were facing increasing pressure to sign bundles covering all their rights, including the performance rights. The movement, he added, accelerated with the arrival of platforms like Netflix that ask global rights without additional payment, whether or not the shows are successful. 

  "The way the model has worked for about 100 years was that we would allow our employers – studios or production companies – to own our copyright for a nominal fee upfront, with the knowledge that we would get royalties at the back end," said Beckerman. However, more and more, creators of programmes "are trying to diverge from that model."

  He added that composers bring "immense value" to AV products and that they should get a fair share of the value created by these programmes or films. "A network or a streaming service will continue to receive money from advertising or subscription fees for continuing to play these shows or films," he elaborated. "They continue to reap the benefit over time. Composers should be able to do the same."

The power of information

  For Beckerman, this unwanted evolution required action. So he set up an information campaign destined to raise awareness, especially with younger composers in mind, to ensure that they had an understanding and knowledge of the issues they face. 

"It's amazing what happens when people understand what they deal with," he enthused. "Composers do not always have the knowledge or access to a lawyer, and they may be tempted to accept deals that are not in their interests. In the end it is about composers' choices, but at least we give them information so that they can make their choice. That's the power of information."

  CISAC is now on board and will amplify the reach of the campaign, said Beckerman (pictured, below). "This is a global issue and we are extremely grateful that CISAC is putting time and effort to bring this issue to a new audience," he said.

  Jean-Noël Tronc, CEO of France's rights society SACEM called buyouts "a negation of copyright which calls into question the entire model set up in Europe and in a large part of the world for two centuries for the benefit of creators." He added: "Many contracts are now offered as buyouts, particularly by major platforms, both among filmmakers and among screenwriters and composers of film scores. We are clearly faced with a problem of informing creators about their rights and safeguarding their interests."

A growing concern

  The new website covers topics including the options of royalties vs buyouts, the typical use of buyout clauses in contracts and the different laws governing buyouts internationally.

  For CISAC Director General Gadi Oron copyright buyouts "are a growing concern for creators and for CISAC societies which represent them and protect their interests. By partnering with Your Music Your Future, CISAC helps fill the information gap and provide a practical and useful educational resource about buy-out contracts and creators remuneration. This should assist creators in making an informed decision about contracts they’re offered and their options.”

  According to CISAC, the projection of global collections is expected to fall by 35% in 2020 had "added a great deal of urgency to the issue of songwriters/composers’ remuneration from the revenue streams that are fast growing – most of all subscription video on demand which has soared during the pandemic."

A self-destructive path

  All over the world, 2020 has seen an increase in subscription video on demand revenue, according to data from Futuresource, which forecasts that total consumer spend in the sector will rise from $41 billion in 2019 to $67bn in 2021. "It is in this area more than any other where copyright buyouts for composers are becoming a big issue," said CISAC.

  "This is just the beginning," echoed Beckerman, who believes that raising awareness on this issue will be beneficial for creators and will hopefully help stakeholders around the world understand that a creator-centric ecosystem is paramount to ensure that new generations of composers will embrace the business.

  "If buy-outs become the norm, and composers cannot make a living, this will be self-destructive for the industry because if it goes on, composers will have no incentive to make music for audiovisual. In the long run, it will be good for everyone if composers can continue to be remunerated, and it starts with composers being educated."

Canada opens a public consultation on the extension of the term of copyright protection

By Emmanuel Legrand

The Canadian government has opened a public consultation related to the implementation of the extension of the general term of copyright protection "to consider whether to adopt accompanying measures to mitigate the potential implications of this longer term of protection."

  Canada has agreed to extend its general copyright term of protection from 50 to 70 years after the life of the author. The new provision is made necessary by Canada being party to the Canada-United States-Mexico Agreement (CUSMA), which requires that the new term extension be implemented by the end of 2022. Canada is the only of the three countries to have to adjust its copyright legislation since the USA already has the provision in its copyright law, while Mexico has an even longer term of protection.

  According to the Canadian government, the consultation will "provide the public and interested stakeholders with an opportunity to discuss possible impacts and to consider measures that may address potential implications of the extended term of copyright protection."

Move forward with copyright reform

  Canadians are invited to share their views on: the adoption of accompanying measures to term extension, including which measures, if any, should be considered; and any additional ideas, comments, legal analysis and evidence in support of potential accompanying measures.

  “Every Canadian is affected by Canada’s copyright laws and I invite them to share their views on term extension," said Philippe-François Champagne, Minister of Innovation, Science and Industry. "Canadians expect copyright law to be fair and balanced, and to keep pace with technological and social change. These consultations will help meet our commitments under CUSMA and guide us as we move forward with copyright reform.”

  Steven Guilbeault, Minister of Canadian Heritage added: “We want Canadian creators to be able to operate on a level playing field with their international partners. Our creators and rights holders should reap the full rewards of their work, and Canadians should have access to a variety of content. Implementing our CUSMA commitment to extend the general term of copyright protection will contribute to a healthy Canadian copyright marketplace.”

The case for orphan works

  Of particular interest to the government is the impact of the new term on works due to enter the public domain and that will be given copyright protection for another 20 years; access to orphan works; availability of out-of-commerce works, among other issues. The government will consider measures to enable use of works not currently being commercialised in exchange for remuneration.  

  Several options are under review:

  1 — Expand Canada's current orphan works licensing regime/extend regime to out-of-commerce work, so that it includes unpublished orphan works and/or published out-of-commerce works for the entire term of protection, to facilitate broader access to such works following term extension;

  2 — Develop a collective licensing regime inspired in part by the EU orphan works and out-of-commerce works directives to facilitate uses of orphan works and/or out-of-commerce work;

  3 — Permit non-profit libraries, archives and museums (LAMs) to use orphan and/or out-of-commerce works by default, without being required to first obtain a license from the Copyright Board, in order to achieve aims related to their public interest missions;

  4 — Provide exception for use of works during the final 20 years of protection so that non-profit LAMs could be permitted to use works during the additional 20 years of protection in order to achieve aims related to their public interest missions;

  5 — Introduce an exception permitting non-profit LAMs to use a work 100 years after its creation, in order to achieve aims related to their public interest missions.

A combination of measures

  "Canada's term of copyright protection could be extended without accompanying measures, with one or a combination of the measures presented in this document, or possibly with alternative measures raised by stakeholders," noted the government in a white paper about the consultation.

  The consultation will close on March 12, 2021.

European artist managers urge rights societies to consult them before setting up livestream licensing rates

By Emmanuel Legrand

The European Music Managers Alliance (EMMA) has called on "all collecting societies across Europe" to fully consult with artist representatives when setting new licensing rates for livestreams.

  EMMA said that due to the pandemic, most artists and their managers have lost around 80% of their income in the past year and that "paid or ticketed livestreaming has emerged to be a lifeline and one of the few ways artists and crew can earn from music performance."

  "We believe a percentage of gross ticket sales from online shows should be paid to Performing Rights Organisations (PROs) so that songwriters can be fairly compensated," said EMMA, but objected to the decision by "certain PROs and major music publishers" to have determined – without consultation – "that livestreams are closer to digital streams, and therefore liable to a much higher audio digital rate."

An alternative for artists

  Per Kviman, Chair of EMMA, said that during the pandemic, livestreaming "has provided one of the few alternatives for artists to perform before an audience, build a fanbase, and generate revenues through ticket sales."

  He has therefore urged PROs across Europe "to be sensitive to these facts, and that the imposition of any new licensing tariffs should involve full and open consultation – including with artists and their representatives. Get the balance right, and we could nurture a vibrant new format that complements live events and provides artists and songwriters with a valuable source of revenue. But set licensing rates too high, and the costs of producing livestream shows simply won’t stack up."

  EMMA brings together Music Managers Forums in Finland, France, the Netherlands, Norway, Poland, Sweden and the UK.

CreativeFuture urges the Biden Administration to adopt a strong copyright agenda

By Emmanuel Legrand

The CreativeFuture coalition, representing more than 560 companies in the creative sector (film, television, music, publishing, photography, and other core copyright industries), has urged the Biden administration to adopt policies that will "maintain America’s role both as the global leader in the creative arts and a global champion for free expression and intellectual property rights."

  In a letter to President Joseph R. Biden, the CreativeFuture coalition said that creative industries have been hit hard by the pandemic in 2020 and that they needed all the support it could get to whether the crisis.

  "2020 was particularly cruel to the creative industries," reads the letter. "The pandemic largely shuttered film and television production for much of the year. It closed live music venues, from stadiums to local clubs, and has forced stores that sell our books, video games, and other creative products to close their doors."

Economic challenges

  It added: "To make matters worse, the pandemic led to a rapid increase in digital piracy, as criminal enterprises capitalised on the fact that so many Americans were forced to remain at home. At a time when many are still unable to work, piracy is cutting into the already reduced legitimate revenue streams from our creations, exacerbating our economic challenges"

  For Ruth Vitale, CEO of CreativeFuture, there is "critical work to be done, both in Congress and in the Executive Branch, to ensure that copyright law works better to promote American creativity. We must ensure that the internet, which can be a great tool for creativity, cannot serve as a weapon to harm creatives on a massive scale."

  The signatories also said they expected the Biden Administration to support "ongoing efforts to ensure that the biggest internet platforms – companies such as Facebook and Google – have greater accountability for addressing the unlawful conduct occurring across their worldwide services." 

Combat commercial piracy

  Vitale told The Hill that the coalition is looking for the the strict enforcement of two pieces of legislation that were signed into law at the end of 2020: the Protect Lawful Streaming Act, which made massive copyright infringement a felony rather than a misdemeanor; and the CASE Act, the small-claims court set up within the Copyright Office, which will allow independent creators to seek up to $30,000 in damages for copyright infringement.

  The letter concludes: "We hope that as our President, your team will build upon your ongoing commitment to strong copyright protection as a bedrock element of American domestic and foreign policy and will help us to combat commercial piracy in the United States and around the globe."

Music Tech Works unveils new database to help identify rights holders for syncs

Jarett Hines (left) and Bryson Nobles (photo credit: Todd Plitt)

By Emmanuel Legrand

Jarett Hines and Bryson Nobles, co-founders of Music Tech Works, believe they have solved one of the critical problems facing synchronisation licensing: finding the controlling publisher and label information of music tracks to be used for syncs.

  They have set up rightsholder.io, a database of over 60 million songs, ready to access for anyone involved in the licensing of music for uses in TV, film, video games, and advertising. "We just took on the challenge and tried to answer the question: who owns what?" explained to Creative Industries Newsletter Atlanta-based Hines, who is CEO of Music Tech Works, which was founded in 2019.

  Nobles and Hines have worked together in the past to create the digital split sheet app SongSplits, and were looking for a new challenge. After some research, in 2019, they realised that there was no consolidated database of rights information, so they set out to build one, as part of the Project Music Accelerator in Nashville, TN. 

An underserved market

  In 2020 Music Tech Works was part of the Google For Startups Founders Academy, and was awarded in October 2020 capital from the Google for Startups Black Founders Fund. The company also closed at the end of 2020 a round of funding from Collab Capital, an early-stage investment fund focused on start-ups by Black founders, which counts as partners hip hop artist Lecrae and Kapor Capital.  

  rightsholder.io provides users a clear and complete way to search for publishing and master recording ownership information. In addition to ownership data, users can quickly identify past use data from shows, movies, and brands that have previously licensed a track as well as sample audio for each track in the database.

  "We looked at syncs and we found that it was a group that was underserved," said Nobles, who is based in New Jersey and serves as CTO. The process, he explained, was to help music supervisors by organising information in a way that could help them do their searches in a timely and accurate way. 

Simple and intuitive interface

  One of the problems with the music industry, said Nobles, is that it is "based on silos of data that do not communicate with each other." Without going into details, Nobles said they have looked at what is available such as the IMDB database and other "trusted sources" displaying information. The data is then recouped using machine learning and is made available via what Nobles describes as a "simple and intuitive" interface. 

  "The system is designed to help people find the information," said Nobles. "We try to make things simple and provide high value to our customers. We are a small team but we are disciplined and focused in solving this data problem."

  One thing that the database is not is user-generated. "You have the possibility to flag information," said Nobles, "but we are not crowd-sourcing information."

Create value for users

    "What we've done is to reduce the time needed for research," said Hines. "In 10 seconds you can access all the data you need to make the calls [to clear songs]. We make sure our data is accurate. We won't feature something if we are not 100% sure."

  Their business model is based on subscription. "Users pay a monthly fee and can access the database without limit," said Hines, who added that the company is now focused on developing its clients' base. "We want more people to use the database," he said. "We understand the value we can create for them, and we want to make sure we serve them well."

IFPI, BMAT and music rights societies in Asia collaborate to launch SoundSys

By Emmanuel Legrand

Global record labels' trade body IFPI and four music licensing organisations in Asia have launched SoundSys, a cloud-based, fully scalable, shared system for the distribution of sound recording performance rights revenue around the world, in partnership with data provider and music technology company BMAT.

  SoundSys provides a "complete, cost-effective back-office distribution system for revenue collected for the broadcasting and public performance of sound recordings and karaoke videos" in Indonesia, India, Singapore and Thailand.

  Neighbouring rights organisations involved in the project include Indonesia's ASIRINDO, PNR (Phonorights) in Thailand, Music Rights Singapore and PPL in India.

Cost-efficient system

  SoundSys uses proprietary technologies to organise, store and match usage and recording data, which enable rights organisations "to distribute royalties in a timely and cost-efficient manner, in line with global best practice."

  The development of SoundSys follows the launch of the repertoire data exchange service, RDx, developed jointly between IFPI and World Independent Network (WIN), which enables record companies to exchange authoritative data with neighbouring rights organisations through a single, centralised hub.

  IFPI said the roll-out of both systems globally will provide "a standardised, high quality recording metadata supply pipeline and data processing capability for MLCs that will significantly improve the performance rights management landscape worldwide."

Unprecedented international cooperation

  IFPI Chief Executive Frances Moore said SoundSys was "truly transformative." She praised the "unprecedented cooperation internationally" that led to the launch of the system. “We have launched in Asia in close collaboration with the music licensing companies (MLCs) that have helped shape and refine the system," she said. "It’s proving to be highly effective in assisting the operations of MLCs and we will now be looking to roll it out in other regions that can benefit most from the software.”

  Jusak Sutiono, Director of ASIRINDO, said SoundSys has already delivered benefits to the society, not least through its matching process to "accurately identify the music content we are allocating revenues to, with the software improving the speed with which we can then process the revenue and distribute it to our right holder community.”

UMG combines its artist and services resources under the Virgin brand

 

Universal Music Group (UMG) has consolidated its artist services division under the new brand Virgin Music Label & Artist Services. The new artist and label services' global network has been inspired and influenced "by the spirit and ethos of the iconic Virgin Records label," the company founded in 1972 by Richard Branson and Simon Draper.

  "Virgin has long been a name synonymous with disruptive innovation, musical creativity and entrepreneurialism," said UMG Chairman and CEO Lucian Grainge. "We are thrilled to announce the reinvigoration of this iconic music brand as a new model for global distribution and label services – combining UMG's unrivalled regional executive teams with dedicated resources and best-in-class services and technology, to help foster long-term partnerships and deliver global success for the next generation of independent labels and artist talent."  

Reaching new audiences

  UMG explained that Virgin Music Label & Artist Services will be led in each region by "highly skilled executive teams, providing fully resourced regional hubs that combine UMG's industry-leading technology platforms, specialist local networks and expertise with UMG's global strength and reach, alongside a suite of resources to help position labels and artists for long-term success globally and to empower the next generation of independent artists and labels to reach new audiences around the world."

  "I'm proud that half a century after we opened our first independent record shop in London, the Virgin Music name continues to represent the very best entrepreneurs, innovators, and artists from the world of music today," said Branson.

   The top five music markets (US, Japan, UK, Germany, France) and Latin America have fully staffed operations providing artists with global solutions. Additional operations will launch in the coming months.

  > In the USA, distribution and service company for independent labels and artists Caroline will be renamed Virgin Label & Artist Services and will continue to be led by Jacqueline Saturn, who becomes President, Virgin Music Label & Artist Services, reporting to Capitol Music Group President and COO Michelle Jubelirer.

  > In the UK, Vanessa Higgins has been appointed as MD, Virgin Music Label & Artist Services UK. She joins UMG from Regent Street Records, the independent record label and music publishing company she founded in 2014. Higgins will report to David Joseph, Chairman & CEO, Universal Music UK. 

  > In France, the new division will be built from the foundations of Caroline France, with operations led by Thomas Lorain who has been appointed as MD, Virgin Music Labels & Artist Services France. Lorain has overseen Caroline France since 2014 and reports to Universal Music France CEO Olivier Nusse.

  > In Germany, existing Caroline operations will be incorporated and expanded into Virgin Music Label & Artist Services, led by Tina Adams, who will assume the role of Label Manager. The label will be based in Berlin and Adams will report to Frank Briegmann, Chairman & CEO Universal Music Central Europe and Deutsche Grammophon. The new division will operate alongside domestic front-line label Virgin Records Germany. 

  > In Latin America & Iberia, Virgin Music Label & Artist Services will launch in early 2021 across a handful of key markets including Mexico, Spain and Latin operations in the US. The label will have dedicated teams and resources based in Los Angeles, Miami and Mexico City. Virgin Music Latin America will be led by Víctor González, who has been appointed to the position of President, Virgin Music LATAM & Iberia. He was most recently President of Universal Music Latin Entertainment (UMLE). Based in Los Angeles, he reports to Jesús López, Chairman & CEO Latin America & Iberian Peninsula. 

  > In Japan, Virgin Music Label & Artist Services Japan will launch from existing capabilities of Caroline Japan and operate alongside domestic front-line label Virgin Music. It will be led by Hirokazu Tanaka, reporting to Naoshi Fujikura, President and CEO, Universal Music Japan. 

  > In addition, Caroline International's label services operation based in the UK will be renamed Virgin Music Label & Artist Services, under the continued leadership of MD's Michael Roe and Jim Chancellor. It will support the Virgin worldwide network to represent and distribute independent talent and labels around the world. 

Artists and Labels to be distributed globally via Virgin Music Label & Artist services include: Because Music (Christine & The Queens, Major Lazer – global markets outside of France), Van Morrison, Steven Wilson, Sophie Hunger, Peter Gabriel, Tame Impala (ex UK, US and Australia), Iggy Pop, Underworld and DAVE (excluding UK and US).

Digital audio consumption went up during the pandemic in 2020 in the United States

By Emmanuel Legrand

Time US adults spent with digital audio grew 8.3% in 2020, compared to 2019, for a total of 1 hour and 29 minutes per day, according to data from eMarketer.

  At the start of the pandemic, digital audio took a huge hit in user engagement and in the amount of time listeners were spending with the medium to a point that analysts at the research and marketing firm predicted "dire results" in the short term. However, once people settled in their new routines, digital audio consumption went up.

  "Listeners developed new habits and preferences while working and schooling from home," noted eMarketer. "Apps like Spotify and Pandora reported increased usage via smart speakers and smart TVs, and increased usage at unusual times of day; for instance, weekday usage began to resemble weekend usage."

Digital audio to overtake traditional radio in 2021

  eMarketer estimates that digital audio accounted for 11.0% of total media time per day for US adults in 2020 and will account for 11.7% in 2021 (1 hour and 34 minutes per day). When it comes to active digital audio listeners, the time spent per day was 2 hours and 5 minutes in 2020, and eMarketer anticipates that active users will spend an additional 5 minutes a day in 2021.

  The company also predicts that 2021 will mark a major milestone between traditional radio and digital audio with a majority (50.8%) of US adults’ total audio time spent listening via digital services. This will be the first time digital audio will surpass traditional radio in time spent.

Music Deals -- Week 8 of 2021

The Beach Boys have entered into a partnership with Irving Azoff’s new venture, Iconic Artists Group, which has purchased a controlling interest in the band's intellectual property, including their sound recordings, brand, select musical compositions, and memorabilia. Terms of the transaction were not disclosed. The members of The Beach Boys and their heirs will retain an interest in their assets "to participate in the upside Iconic expects to create by actively marketing and promoting The Beach Boys," said the company. The deal involves Brian Wilson, Mike Love, Al Jardine, and the CarlWilson estate. "As we look towards the upcoming 60th anniversary of The Beach Boys, we wanted a partner to help expand opportunities for our brand, while continuing to preserve our tradition as a band whose music transcends the test of time," said the band. "We are confident that Irving and Iconic are the ideal partners and are confident that The Beach Boys’ ongoing legacy is in the best possible hands." Azoff, Chairman and CEO of The Azoff Company, commented: “I am honoured that the Beach Boys have entrusted Iconic to preserve and grow their legacy. And I’m thrilled that the Beach Boys want to stay invested in the growth of the incredible cultural brand they created.”

South Korea's independent music company Big Hit Entertainment and Universal Music Group have sealed an expanded their strategic partnership that will see the two companies work closely together "to increase opportunities for artists through innovation and technology, whilst expanding the global reach of K-pop music and culture around the world." The agreement will allow UMG artists to explore enhanced "direct to fan" communications through Big Hit's community-based platform Weverse, which is already used by UMG artists Gracie Abrams, New Hope Club and Alexander 23. In addition, the two companies plan to "to assemble and debut a new global K-pop boy group together in the US for the first time." The new artist project will be released under a new JV label to be created between Big Hit and UMG's Geffen Records. "Our two companies indeed share values and visions in that we both pursue constant innovations and are committed to providing our fans with genuine music and content of the highest and uncompromising level of quality," said Bang Si-Hyuk, Chairman & CEO of Big Hit Entertainment. "In this sense, I strongly believe that UMG and Big Hit will create a synergy that will rewrite the global music history."

Warner Chappell Music has signed a publishing partnership with Atlanta-based independent music company Love Renaissance. The partnership includes new signings with Atlanta rapper BRS Kash, Cruel Santino, GMK and Genio Bambino. Warner Chappell has also extended its deal with LVRN R&B artist and songwriter Summer Walker. “Our main focus since the label’s founding has been the development of artists.  “We are now committing the same focus and approach with publishing to develop the best songwriters, producers, and artists," said LVRN Co-founder and President, Tunde Balogun, and Co-founder and Head of A&R, Justice Baide.

British company Sentric Music Group has signed a music publishing deal with singer and songwriter Danny Dearden, through its Black Rock division. He has worked recently with the likes of Mark Villa, Going Deeper, Aexcit, Erlandsson, Dario G and Bobby Harvey. 

British independent music publisher Blue Raincoat Music Publishing, in conjunction with Reservoir, have acquired the catalogue of D:Ream founder, vocalist and principal songwriter Peter Cunnah. The deal includes the UK's No.1 song 'Things Can Only Get Better' and the albums 'D:Ream On Volume 1' and 'World'. 

Sony Music Publishing has signed Australian artist, songwriter, and producer TheKid LAROI (a.k.a. Jeffrey Howard) to a worldwide publishing deal. “The signing of The Kid LAROI signals an important new era for Sony Music Publishing. LAROI is an international talent that represents the next generation of iconic superstars, and we’re excited to support his future as a songwriter,” said Sony Music Publishing VP, Creative, Adrian Nunez.

Musical Chairs -- Week 8 of 2021

 USA

Private equity advisor Mona Sutphen (pictured, below) has been tapped to join the board of directors of music streaming service Spotify in April 2021. The appointment, subject to shareholder approval, was announced by Spotify co-founder and CEO Daniel Ek, who said she would bring "a new and highly valuable perspective to the Board as we focus on driving our strategy forward during this time of exceptional change around the world.” Sutphen, who is currently a senior advisor at Chicago-based private equity firm The Vistria Group, has advised and co-founded several start-ups. She was a former White House Deputy Chief of Staff for Policy for President Barack Obama between 2009 and 2011.


Online song marketplace and licensing platform Rocket Songs has hired California-based music supervisor, songwriter and producer Jody Aaron Friedman as its new Director of Content Acquisition. A member of the Guild of Music Supervisors, Friedman has an expansive resume, covering music publishing, music supervision, songwriting and performance. He reports to Jonathan Stone, Co-Founder, President and Creative Director of Rocket Songs.

Livestream platform Looped has appointed Faisel Durrani as co-CEO, with a mandate to focus on strategic initiatives, new business opportunities, marketing strategies and talent relationships. Durrani was CEO of Ariyumi Consultingand worked previously for Live Nation and Def Jam Recordings. 

US independent music company Sumerian Records has appointed Jill Pedone to the newly created position of Chief Strategy Officer, reporting to Founder and CEO Ash Avildsen. Pedone will be leading the Washington, DC- and Los Angeles-based company's publishing and sync operations, and work with Avildsen to implement strategies to “uplevel all facets of the Sumerian business.” She worked previously for Lava Records, Dualtone and BMG. Pedone is expected to relocate from LA to London by the end of 2021 to run the label's new operations in the UK. Sumerian Records' roster includes Asking Alexandria, Poppy, Palaye Royale, Bones UKand Smashing Pumpkins. 

Warner Music Group (WMG) has hired and promoted a series of executives to the position of Senior Vice President of Catalog Development and Marketing: Blake Foster, who re-joins WMG from Skrillex’s label OWSLA; Ingrid Erickson, who joins from Warner Records, where she was VP of Marketing; Alicia Yaffe, who joins from Jampol Artist Management and The Spellbound Group; Nigel Reeve, who most recently served as VP of Catalogue A&R at Warner Music UK; Mike Engstrom, who was marketing and content development for WMG’s global catalogue. In addition, Andrea Craig has been promoted to Senior VP of Content Development and Curation, leading WMG Arts Music’s projects in kids, family, musical theater, jazz and crossover. They all report to Kevin Gore, WMG’s President, Global Catalogue, Recorded Music and Arts Music.

BMG Production Music has appointed Deb Oh as Senior Director of Creative Licensing. Based in New York, she reports to Amberly Crouse-Knox. head of BMGPM US sales team. She joins from creative audio agency Squeak E. Clean Studios where she was Executive Producer.

Grammy Awards' organiser the Recording Academy has hired RayStarck as Vice President of Digital Strategy, leading the Editorial, Digital Media Production and the Product teams. He will be responsible for content strategy and website management and reports to Chief Operating Officer Branden Chapman. 

Why&How Management founder Bruce Kalmick has partnered with Sony Music Entertainment's services and distribution company The Orchard to launch Hazel Street Records, a new label operating out of Nashville. Kalmick will serve as CEO of the new venture and LauraBenderhas been appointed to run the label's day-to-day operations. She was most recently working at Hard 8 Management/Folsom Records. The label’s first signings are Goldpark and Nox Holloway.  

UK

The British live music industry has formally set up a industry organisation to represent its interests: LIVE or Live music Industry Venues & Entertainment. The federation regroups artists, managers, venues, festivals, promoters, agents, production and ticketing companies through the 13 principal industry associations across the sector, representing 3,150 companies, over 4,000 artists and 2,000 backstage workers. Greg Parmley, publisher of trade magazine IQand organiser of the ILMC conference, has been appointed CEO of LIVE. “LIVE is an opportunity to represent the whole of the live industry, from the smallest show to the biggest festival. We are delighted that the founding associations include organisations at the very top of our industry and those with deep connections into the foundations on which that industry is built," said Parmley.

Dan Gopal has been appointed Chief Commercial Officer of British rights society PRS for Music, effective 1 March 2021. He will be leading commercial and strategic partnerships and drive the society's digital transformation. He will be part of PRS for Music’s Executive Leadership Team and will be reporting to CEO Andrea Martin. Gopal joins from Hasbro-owned Entertainment One where he was EVP & Head of Sales EMEA.

Sentric Music Group has hired Shino Parker as creative manager to its Sentric Electronic division. Parker is tasked with facilitating collaborations between the publisher’s electronic music producers and the Group’s singers and songwriters. Parker is the owner and director of artist management company Motion. 

Vivendi plans to list Universal Music Group on Amsterdam's Euronext exchange by the end of 2021

By Emmanuel Legrand

French entertainment group Vivendi  has unveiled plans to spin off by the end of 2021 its music division, Universal Music Group (UMG), on the Euronext NV exchange in Amsterdam.

  The company has set a minimum target of €30 billion for UMG’s enterprise value, which is consistent with the recent purchase of 10% of UMG's shares by a consortium led by China's Tencentfor €3bn, in addition to the 10% it already owned.

  Vivendi said in a statement that its leading institutional shareholders "have been pressing for a number of years for a split or the distribution of Universal Music Group (UMG) to reduce Vivendi’s conglomerate discount," and that following an assessment on how to "obtain a fair value for UMG to better serve the interests of its shareholders" decided that the listing of UMG will take place by the end of this year.

Bolloré will control 36% of UMG

  The Management Board of Vivendi is considering a distribution of 60% of UMG’s share capital to Vivendi shareholders, in the form of a "special dividend." Vivendi owns 80% of UMG. Vivendi's Chairman of the Board Vincent Bolloré, owns 27% of Vivendi through his family holding.

  Reuters calculated that UMG's listing would net Bolloré about 16% of Universal’s shares directly, which combined with the 20% Vivendi will still own, should give Bolloré control of about 36% of UMG's capital.

  The listing of the shares of UMG would be applied for on the regulated market of Euronext NV in Amsterdam. Vivendi explained that the choice of Amsterdam was related to the fact that UMG's holding company is currently being incorporated in the Netherlands, a country which has been one of UMG’s "historical homes."

An undisputed market leader

  The latter point was a reference to PolyGram, the Philips-owned music company that was acquired by Seagram in 1998 and merged into its music division Universal Music Group. Vivendi then merged its assets with Seagram's and eventually became the sole owner of UMG.

  Yannick Bolloré (pictured, below), Chairman of Vivendi’s supervisory board, and Vivendi CEO Arnaud de Puyfontaine, said in a memo to employees that the plan "is the result of the joint efforts in recent years by the Vivendi and the Universal Music Group, under the leadership of Sir Lucian Grainge, to further the company’s position as the music industry’s undisputed leader.”

  They added: “UMG has strengthened its worldwide leadership by focusing on its creative DNA and uniqueness: talent, both new and established, both local and global. At the same time, UMG has succeeded in leading the massive transformation in consumer adoption of streaming and subscription.” 

A validation of Vivendi's strategy

  UMG Chairman and CEO Lucian Grainge commented on the project to establish UMG as a stand-alone company in a memo to staff, seen by Music Week: "I couldn’t be prouder: not only is this a validation of our strategy, our teams, and our unprecedented record of success, it’s a natural evolution in the storied history of our company that will enable our entrepreneurial and creative culture to continue to soar. We’ll continue to drive towards our strategic goals – full steam ahead. We’ll remain committed to our artists and songwriters. And we’ll continue to innovate and help lead the music community towards an incredible next chapter."

  Vivendi said it would call for an Extraordinary Shareholders’ Meeting for March 29, 2021 to modify the company’s by-laws and make the distribution of shares possible. "Subject to a positive shareholder vote, Vivendi will continue to work on this project, including a Shareholders’ Meeting to approve the distribution and subsequent completion of the transaction before end 2021," said the company. 

MEPs express concern about EU Commission's proposed guidance on the transposition of the Copyright Directive

By Emmanuel Legrand

Officials from the European Commission’s DG Connect have met virtually with EU lawmakers after they voiced in a letter their concern about the Commission's proposed guidance on how EU members should transpose the Copyright Directive, in particular Article 17, which relates to the liability of digital service providers. 

  The meeting, which took place on February 12, was attended several MEPs, including Sabine Verheyen, Chair of the Culture Committee at the Parliament, Axel Voss, Sylvie Guillaume, among others, and by the Director-General of DG Connect, Roberto Viola, and Giuseppe Abbamonte, responsible for media policy at DG Connect.

A positive dialogue

  Spanish MEP Ibán García, who initiated the reunion, commented on Twitter: "Positive dialogue with @EU_Commission to ensure proper guidance of art 17 Copyright, essential for creators to earn a decent living."

  Throughout 2019, the Commission held a series of consultations with stakeholders in order to come up with a consensus on how to deal with Article 17. However, several countries, led by France, objected in a non-paper to the approach taken by the Commission, which they saw as drifting away from the letter and the intent of the Directive. The same concern was expressed by MEPs in their letter to the Commission.

Need for a different approach

  “The current approach to the Guidance would not properly reflect the agreement hardly achieved after long negotiations on Article 17 of the Copyright Directive,” reads the letter, seen by Euractiv. “The latest response to Parliamentary questions on this matter by the Commission and recent public remarks made by members of DG Connect services have not helped to assuage these concerns."

  Sources in Brussels suggest that the guidance draft will be made public around mid-March of this year.

  The Copyright Directive is due to be transposed in EU members States' national legislation by June 2021, and so far few countries have completed the process.

US indie sector urges Congress to adopt the HITS Act

By Emmanuel Legrand

A group of some 120 executives from the US independent music sector from 19 states, led by American Association of Independent Music (A2IM) President and CEO Richard James Burgess (pictured, below), have sent a letter to Senate Majority Leader Charles Schumer (D-NY) and Speaker of the House Nancy Pelosi (D-CA) to urge them to include in the forthcoming Coronavirus Rescue Legislation a "modest" relief provision for the creation of recorded music.

  More specifically, the signatories of the letter — artists, managers, agents, executives and independent record label owners — have asked that the Help Independent Tracks Succeed (HITS) Act, sponsored by Senator Dianne Feinstein (D-CA), Representative Linda Sanchez (D-CA), Senator Marsha Blackburn (R-TN) and Representative Ron Estes (R-KS), be enacted into law.

  "The HITS Act would allow recording artists and their record label partners to immediately expense the cost of most indie projects, rather than having to spread out the tax benefit over time," reads the letter, adding that extending the provision to recordings would be "a reasonable, bipartisan and fiscally responsible measure that represents a needed lifeline for our suffering industry."

Important tax credits

  For A2IM, the legislation "would grant the same tax treatment to sound recording production costs that is currently afforded to other arts productions including live theater, television and motion pictures."

  “The American Rescue Plan already includes important tax credits to support working class families and recognises the economic importance of small businesses, especially in black and brown communities,” said Rosie Lopez, President of New York-based label Tommy Boy. "The HITS Act is a natural extension that recognizes the way our industry partners with artists by financing their projects."

Benefits for individuals too

  A2IM said one of the benefits of the HITS Act is that unlike many other relief proposals that entail direct federal spending to support ailing industries, the HITS Act simply speeds up music creators’ ability to deduct the first $150,000 of sound recording production costs from their taxable income. "Because of advances in technology, many artists record and even release their own music today, and the benefit would extend not only to businesses but also to individuals," explained A2IM.

  "Musicians generally manage to cobble together a livable income only by combining live performances with the release of recorded music,” said Burgess. "With half of their income stream dormant for the foreseeable future, and elected officials frequently pointing to the power of music as a positive force to uplift people in tough times, we sincerely hope that we won’t get left behind." 

Canada's Quebecor acquires indie company Audiogram

By Emmanuel Legrand

Canadian media group Quebecor, through its division Quebecor Sports and Entertainment, has acquired Québec's leading independent music company Audiogram for an undisclosed amount. The transaction includes the record label and distribution unit as well as music publishing house Éditorial Avenue, Canada’s largest French-language music publisher.

  Audiogram was founded in Montréal in 1984 by Michel Bélanger and Rosaire Archambault and quickly became the largest independent music company in Québec. Philippe Archambault, who has led the company since 2015, will remain Audiogram’s General Manager and also becomes Vice President Music of Quebecor’s Sports and Entertainment Group. Daniel Lafrance, CEO of Editorial Avenue, will also stay at the helm of the publishing unit.

  "It was important to Rosaire Archambault and me to keep the music catalogue in Québec hands," said Bélanger. "I am confident that the artists will continue to enjoy outstanding support and the freedom to give full expression to their talent. Seeing our company acquired by a Québec-based owner that cares about Audiogram and will give it the respect and sensitivity it needs, with Philippe Archambault staying at the helm, is all I hoped for."

Preserve creative freedom

  Martin Tremblay (pictured, below), Chief Operating Officer of Quebecor Sports and Entertainment, said Quebecor will "preserve the artistic personality and creative freedom that have been Audiogram’s hallmarks since its inception." He added: "We are determined to support our creators and will continue producing diverse musical content and introducing new artists."

  Audiogram's roster includes recordings from Bran van 3000, André Gagnon, Isabelle Boulay, Jim Corcoran, Pierre Lapointe, Pink Martini, among others. Éditorial Avenue represents songwriters such as Eric Lapointe, Jean Leloup, Lhasa de Sela, Ariane Moffat, and is also the sub-publisher for Québec of catalogues such as peermusic France, Métisse Music or Sony Music Publishing France.

  In a LinkedIn comment, Lafrance said he was "not ready to retire" and that he believed that the deal will allow Audiogram and Éditorial Avenue to "retain their artistic integrity, their corporate values and their decision-making autonomy."

Commitment to Québec culture

  "We have been committed to Québec culture for decades and we are delighted to be able to continue supporting talented local artists with this acquisition," said Pierre Karl Péladeau, President and CEO of Quebecor. "Music is a source of pride and richness for Québec and we will continue to do everything we can to promote it and bring it to the widest possible audience. I want to pay tribute to Michel Bélanger and Rosaire Archambault, who have played such a pivotal role and will remain valued contributors to Audiogram."

  Quebecor Sports and Entertainment already owns Musicor and STE-4, headed by Anne Vivien, Executive Vice President, Music Development of Quebecor, and MP3Records, headed by Mario Pelchat.

Google $76m deal with French news publishers criticised as 'opaque'

By Emmanuel Legrand

Google's agreement to pay directly $76 million over three years to a group of French news publishers has been described by other publishers who are not party to the deal as "opaque."

  Reuters reported that the deal includes a framework agreement which will see Google pay $22 million annually in total to a group of 121 national and local French news publications, represented by the Alliance de la presse d’information generale (APIG), pending individual licensing agreements signed with with each of them.

  Another document disclosed by Reuters is a settlement agreement by which Google will pay $10m to the same group of publishers "in exchange for their commitment to end all present and future potential litigation tied to copyright claims over the duration of the three-year agreement," said Reuters.

Commit to use Google News Showcase

  APIG and Google reached an agreement at the start of the year but had not disclosed the terms of the deal. “These opaque agreements don’t ensure the fair treatment of all news publishers, since the calculation formula isn’t made public,” said SPIIL, the organisation regrouping independent online news publishers.

  Reuters disclosed that publishers willing to access the yearly $22m pot each organisation will have to sign an individual licensing agreement with Google. France's leading daily Le Monde would receive $1.3m while local publisher La Voix de la Haute Marne would cash in $13,741. In addition, national dailies such as Le Monde, Le Figaro and Liberation have negotiated about €3m ($3.6m) each per year on top of this, and have agreed to sell subscriptions through Google.

  APIG members also have to commit to use and feed Google’s news platform Google News Showcase, currently rolled out in Brazil and Germany and to be launched in Australia too.

Complaint with antitrust authorities

  Google was forced into an agreement in France as the country was the first to transpose into national legislation the European Union's Copyright Directive, which introduced, through its Article 15, the concept of a neighbouring right paid to news publishers by platforms using news or indexing news. 

  However, many news organisations complain that the direct deal between APIG and Google leaves too many publishers out of the agreement and distorts the law. News agency Agence France-Presse (AFP) has filed a complaint with the France's antitrust authority against Google.

  The agreement with French publishers is one of the first of such deals signed by Google, which has also started making deals with local publishers in Australia, while still combating the country's proposed Code that will force online services using news content to remunerate news publishers.