Absence of recognized licensing structures in the Gulf States opens the door to international collection-societies

Few regions in the world have escaped the spread of digital-music services. Even in the least developed territories, basic digital services, such as ring tones and ring-back tones, have been rolled out in an effort to tempt customers to go digital. But even though many of the Gulf States have highly developed technology infrastructures, digital-music services have been slow to take hold. Moreover, the lack of collection societies to administer rights collections has left the region as something of a rights wasteland. Could overseas involvement kick-start the rights-administration process?

Despite political unrest in much of the Middle East, technology developments across the region have progressed at a rapid pace. According to Informa Telecoms & Media, at end-June the average mobile population penetration for the region was 99.5%. Although broadband household penetration is relatively low when compared with developed countries, some of the Gulf States have highly developed broadband infrastructure. For example, household penetration is above 100% in Bahrain, Qatar and the UAE.

But despite having ideal conditions for digital-music services to flourish, consumers in the region remain underserved. Earlier this month the Lebanese digital music provider Anghami launched a mobile and online music streaming platform. The service can be downloaded as an app and gives access to two million Arabic and international titles. Anghami allows for free streaming on mobiles, but charges US$5 a month for online streaming. However, Anghami is the first such service in the region.

Notable by its absence in any of the Gulf States is international subscription streaming service Deezer, which has become synonymous with mass country availability. Last month it rolled out its service in 76 countries, taking the total closer to its stated aim of 200 countries. But no Middle East countries were part of the latest rollout, with the closest being Libya and Afghanistan.

International rescue
High rates of piracy in the region have certainly played a major part in the lack of legal digital-music action. Moreover, the lack of established collection-societies hasn’t helped. But, the region is not devoid of all hope. Authors’ and publishers’ rights in Egypt, for example, have long been administered by the Society of Authors, Composers and Publishers of the Arab Republic of Egypt (SACERAU). SACEM of France has had relations with SACERAU for several years and represents Egyptian artists outside of the country. More than 1,000 rights holders in SACERAU are also members of SACEM.

SACEM has also been present and active in Lebanon for 70 years, and with most Arabic music coming from Egypt and Lebanon, the collection society is ideally placed to further rights administration in the region. At end-2009, Rotana became a SACEM member, and SACEM handles the management of Rotana’s rights on a global basis, except for Turkey.

UK authors’ society PRS for Music has been active in the Middle East for about three years. The collection society shares SACEM’s view that the initial requirement is to raise awareness of copyright in the region and then develop rights organizations in partnership with local governments. At end-2011, PRS for Music and SACEM teamed up for a joint initiative with Emaar Properties in Dubai to license the public performance of music that accompanies the Dubai Fountain, a choreographed fountain system set on the Burj Khalifa Lake in Downtown Dubai. Discussions are ongoing with Emaar Properties regarding licensing requirements for its other properties and interests.

PRS for Music and SACEM are an ideal fit, given their different repertoire strengths and experience in pan-regional licensing. However, there are opportunities for both collection societies to increase their influence in the region aside from helping to establish local societies. In Europe, for example, collection societies’ national boundaries are often cited as being one of the main reasons digital-music licensing in the region is cumbersome and has not reached anywhere near its full potential. All of the major music publishers and a number of independents have withdrawn their digital-rights mandate from national collection societies in Europe and either created a licensing hub in partnership with one collection society or launched an initiative for collection societies to sign up to.

Setting up a collection society in each of the Gulf States is a laudable aim and would benefit rights holders by having in place an administration system for the collection of royalties from the local use of their music. But in most of the region’s countries the physical recorded-music sector has been lost to pirates, and the future of recorded-music sales in the Middle East is in digital form. Creating some form of digital-music licensing hub for the region would seem the ideal solution to the problem, and those collection societies in Europe already heavily involved in similar licensing structures are in the best position to establish something similar in the Middle East. The initial challenge, however, is simply to convince all music users of their responsibilities to rights holders, a process that has already taken several years of painstaking negotiations and one that is expected to go on for several more years.

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