Category: Collection societies

New issue of Music & Copyright with Canada country report

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

Streaming the case to Vivendi for a UMG sell-off
Vivendi investor and hedge fund P. Schoenfeld Asset Management (PSAM) has presented a case to Vivendi to spin off UMG and create a stand-alone company. According to PSAM, UMG would benefit from operational and structural advantages as an independent company. Included in its presentation are forecasts for the global music sector, in particular, some fairly optimistic projections for the growth of streaming. PSAM suggests that an independent UMG would become an attractive strategic acquisition target for companies with digital streaming platforms since royalties and performance rights capture 50–70% of digital streaming revenue. PSAM bases its revenue projections on a big rise in the installed base of smartphones, which the hedge fund claims will act as a catalyst for the transformation of the recorded music sector.

19 Recordings fends off SME’s dismissal motion in royalties dispute
Recorded music major SME has failed in a bid to have a case brought against it by the record company 19 Recordings dismissed. A New York federal court judge ruled in March that several of the claims brought by 19 Recordings should be heard at trial. SME was accused by 19 Recordings in February 2014 of underpaying royalties amounting to $7m earned by a number of contestants on the TV show American Idol including Kelly Clarkson, Clay Aiken, and Carrie Underwood. 19 Recordings, which is the subsidiary record company of 19 Entertainment, the creator of the show, signed the contestants to exclusive recording agreements and licensed the winners and runners up to SME to exploit their music releases. SME filed a motion in June to dismiss all the claims, which were uncovered by 19 Recordings after an audit of SME’s accounts.

Mixed fortunes for the major music groups in 2014
All of the major music companies have now published their financial details for 2014. A comparison of their respective performances reveals differing fortunes for the three in terms of earnings from recorded music and music publishing sales. Consolidation in the two sectors and exchange-rate fluctuations has greatly muddied the year-on-year performance waters in the last couple of years. When these distortions are factored in, the financial details suggest that, in group terms, SME and WMG made gains in 2014 while UMG suffered a decline. Recorded music earnings for UMG came under pressure last year. However, the global leader can draw some relief from a good performance from its publishing division UMPG.

Streamers look for pole position in in-car entertainment
Apple is building a very strong presence in in-car entertainment via its iOS-based CarPlay system, with that position set to be bolstered by the imminent launch of a new – and likely to be very competitive – music streaming service. The company, along with rivals like Pandora and Google, has been busy ensuring that its music gets onto vehicle dashboards to take advantage of the forecast growth of in-car entertainment consumption likely to come with the surge in production of connected vehicles. However, streamed music will not have everything its own way as it still has work to do to convince consumers to give up on a very popular incumbent in the shape of much-loved AM/FM radio, while services need to be much easier to use than they are at present if they are to gain mass acceptance.

Canada country report
In addition to the usual set of music industry statistics and news briefs, the latest issue of Music & Copyright includes a detailed Canada music industry profile. Canada experienced a second consecutive year of recorded music contraction in 2014. Trade revenue figures will be published by the IFPI later this month, but, according to Nielsen SoundScan, unit sales of recorded music were down. Streaming gains are expected to have reduced the rate of contraction in trade revenue in 2014 compared with 2013 and continued gains could well result in growth in 2015. Preliminary details published by authors’ society SOCAN show royalty collections were up for the second year in a row. Canada’s live music industry also had a good 2014.

If you want to know more about Music & Copyright then follow the below links.

Music & Copyright is published by Ovum.

Has the music industry forgiven Justin Timberlake for his MySpace links and accusations of artist exploitation?

myspace_2452447bDepending on where a musician sits in the music industry value chain, a top-10 list of what’s most important to an unsigned artist will differ greatly to one compiled by a million-album seller. Scratching a living out of music is something tens of thousands of musicians do every day. Although the Internet has opened up the promotion and distribution of music to anyone with a computer, it has also made selling music a lot more difficult as almost every single release in a digital-music store is available for free somewhere online. Continue reading

Is repertoire fragmentation the new enemy of digital-music services in Europe?

Last year the European Commission introduced new proposals for a directive on the collective management of copyright and multiterritory licensing of music. The proposals, which target collection-society transparency and the efficient working of digital-distribution businesses in Europe, are working their way through a series of committees. After that, they must be agreed upon by the European Parliament and European Council of Ministers.

What the directive will not do is interfere with the way music publishers administer their rights. All of the major publishers and a number of independents have withdrawn the rights to certain repertoire for licensing on a multiterritorial basis. Some see these moves as a step towards the creation of a new form of fragmentation, one based on repertoire, rather than national borders. Publishers have long claimed that withdrawing certain repertoire rights streamlines the licensing process. However, music ownership can involve multiple publishers and therefore digital services that want to provide an all-encompassing offering still need to sign more licensing deals than the number of countries they operate in. Continue reading

A short history of the music industry: different formats, familiar names but the same old problems

M&C coverIn the past 20 years or so, all sectors of the music industry have been through massive change. Format transitions, company consolidation and greater scrutiny of copyright and licensing have changed the industry beyond all recognition. But have the changes made for industry improvements, and more important, have the main players learned from their mistakes? The recent discovery of the first issues of Music & Copyright has allowed for a unique look at just how much certain things have changed, and how much they haven’t.

The newsletter’s 20-year anniversary came and went in September, but thanks to a long-standing subscriber, copies of the first 24 issues published have been found and make for interesting reading. Despite containing names that have either long since left the music industry or been swallowed up as part of industry consolidation, the headlines for a number of news stories resonate closely with happenings today. Continue reading

Why emerging markets are taking center stage in international digital-service rollouts

Toward the end of last year, Deezer and iTunes extended their footprints to include several countries that are often considered emerging markets. The growth of broadband Internet use around the world, providing access to a wealth of unauthorized recorded music, has made life difficult for new digital-service rollouts. But with the balance of economic power expected to shift away from the current leaders, is now the time for the emerging markets to start living up to their name? Continue reading

When royalty collection costs outweigh the benefits, is it smaller artists that miss out?

Blog picThe accuracy of data regarding the reported use of music is key in determining the level of royalties paid to authors, publishers, performers and producers. Improvements in technology to identify what music has been played and performed at all manner of venues and establishments has resulted in higher collections and greater confidence that royalties are reaching the correct recipients. But is there a point where collection costs outweigh the benefits? And if so, are the smaller, less commercial artists the ones in danger of missing out? Continue reading

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? Continue reading