New issue of Music & Copyright

The latest issue of Music & Copyright is now available for subscribers to download. Here are some of the highlights.

Guvera lifts the lid on its finances and business strategy
Guvera’s plans for an IPO remain in the balance after the Australian Securities Exchange (ASX) decided to block the streaming service’s listing. The Australian service detailed its IPO plans at the end of May, but when it published its supporting prospectus, the Australian Securities and Investments Commission (ASIC) forced a revision of the document. Then, 24 hours after the new prospectus was submitted, the ASX said it was refusing Guvera’s admission to the official list. A meeting between the two parties is set to take place to discuss the decision. Whether the listing takes place at all will soon become clear. Either way, the IPO prospectus has provided an insight into Guvera’s operating performance as well as its future plans. In common with most streaming services that are running up some pretty heavy losses, Guvera’s cost of sales heavily outweigh its revenue. Although the service is available in 20 markets, the prospectus revealed details of Guvera’s plans to concentrate on 10 of those markets, most of which have provided little in the way of earnings for record companies in previous years. Also included in the document is an assessment of the risks faced by investors, fueling the already intense debate on the robustness of the music-streaming business model.

Digital and overseas gains boost STIM revenue to new record
Swedish authors’ society STIM has reported another record financial year with total collections and distributions to its members topping the previous records set in 2014. Collections from online and new media services again registered impressive year-on-year growth. Although broadcasting is still the biggest domestic source of collections, a slight decline in overall broadcasting income, coupled with gains in digital collections, meant the two revenue sources accounted for almost the same share of total domestic income. Collections from overseas remained the biggest income source for STIM’s author and publisher members and last year foreign earnings, particularly from the US and UK, grew sharply. Royalties from festivals and live music concerts suffered a second year of decline after a sharp rise in 2013.

Music’s year of virtual reality has the potential to pay off
The music industry is making a play for virtual reality (VR), and this year will see an array of VR initiatives, leaning primarily on live performance video. The VR segment is set to explode, with gaming likely to be the biggest beneficiary, but music companies could develop a new revenue category built on VR. However, to succeed, they need to ensure that their output is more than mere 360º video. Music content will need to be deeply engaging and immersive if it is to cut through.

JASRAC reports stable year for royalty collections
Japanese authors’ society JASRAC has reported a small decrease in royalty collections in the 12 months to end-March 2016, after a similarly small increase in the previous 12-month period. Despite a rise in general performance and digital collections and a flat year for broadcasting income, the continued decline in mechanical royalties resulted in an overall dip in collections. However, in contrast to collections, JASRAC reported that distributions to members edged up slightly in the year. Broadcasting remained the biggest single source of earnings for Japanese authors.

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Music & Copyright is published by Ovum.