New issue of Music & Copyright with Spain country report

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

Flat year for authors’ royalty collections in 2014
Combined royalty collections for the 20 biggest authors’ societies and organizations that have published results increased 1.6% in 2014. Although the growth rate was down on the 2.8% rise in 2013, it marked the second consecutive year of rising collections after a slight dip in 2012. French authors’ society SACEM was the leader in terms of collections, with European collective rights management organizations (CMOs) accounting for the top three positions. However, the US is the clear leader in terms of authors’ collections at country level with combined collections by the rights organizations ASCAP and BMI surpassing the $2bn mark. Europe is biggest region, accounting for more than half of the global total.

Big jump in global performance rights earnings in 2014
Performance rights distributions broke new records in 2014 with total payments rising to their highest levels and distributions to performers topping $1bn for the first time. Often seen as the poor relation to authors’ rights, combined global payments to producers and performers exceeded $2.4bn and accounted for just under 15% of global recorded music industry revenue. Global receipts from performance rights remain dominated by the US organization SoundExchange and the continued growth in payments to SoundExchange is the biggest source of growth for the performance rights sector. However, even excluding the US organization, distributions to performers and producers were still up on 2013, albeit by a reduced rate.

Music goes mobile in India with Saavn leading the charge
Indian digital music provider Saavn had been grabbing headlines recently as “India’s answer to Spotify.” The company secured a huge injection of cash last summer and has some high-profile names in its management team, while its user numbers are growing apace. But Saavn faces some serious competition, not least from powerful telcos such as Airtel. Moreover, Apple Music landed in India during the summer and is clearly very well placed to take market share. As elsewhere, digital music consumption is migrating to mobile, so getting services right on that platform in a fast-growing smartphone market will be key. Content will be important too, with local music an essential part of the mix for Indian consumers.

Spain country report
In addition to the usual set of music industry statistics and news briefs, the latest issue of Music & Copyright includes a detailed Spain music industry profile. Spain’s music industry is on something of a roll at the moment after many years of contraction. Recorded music sales increased in 2014, the first time in 12 years, and have continued to rise this year. Royalty collections in the country edged up in 2014 after three straight years of decline. The live sector also registered a positive year with turnover up and prospects for 2015 thought to be good. The optimistic figures come at a time when the Spanish economy is showing real signs of improvement. However, it is worth remembering that the music industry, particularly the recorded music sector, has a long way to go before it can declare itself out of the woods. Also, the live sector is continuing to push for a lowering of the VAT rate on cultural events, which continues to exert downward pressure on promoters’ earnings.

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Music & Copyright is published by Ovum.

New issue of Music & Copyright with Japan country report

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

Little change forecast for global recorded music retail sales
Ovum has published new forecasts for retail sales of recorded music that suggest little variation in overall spending levels, but the continuation of the transition from ownership to access. Although global consumer spending on recorded music will change very little in the years to 2020, spending on digital formats and services will overtake physical formats this year and go on to account for almost three-quarters of all sales in just six years. According to Ovum, music subscriptions will lead the charge, dominating retail spending for the foreseeable future. Record companies are set to benefit most from the streaming gains, given the lower costs involved, and are expected to register increased earnings annually.

The corporate live music sector is heading for a record year
All of the leading players in the corporate live music industry have now published financial details for the first half of 2015. An assessment of how the sector has performed suggests the live music industry could well be heading for a record year. Combined earnings for the seven featured companies showed healthy growth overall with only the Brazilian promoter Time For Fun suffering a year-on-year decline in revenue. Live Nation is by far the biggest of the seven events companies detailed but the strongest revenue gains were registered by the most recently listed promoter SFX Entertainment. However, turbulence in SFX’s delisting process has hit the company’s share price and there remains a big question mark over the company’s future.

Music industry gets legal but digital compromise is coming
A recent court case in the US that has gone against the music industry has highlighted the fact that record companies have been ignoring the concept of “fair use”, which allows third parties to use IP-protected content for purposes such as news reporting, criticism, or parody without the permission of the copyright owner. At the same time, online service providers such as YouTube and SoundCloud are coming under increasing pressure from rights holders to license content shared by their millions of users. The music industry is challenging US and European “safe harbor” provisions which enable service providers to disseminate music without licensing the content first. However, while the two parties are currently at loggerheads over who extracts the value produced by artists, they do have strategic objectives in common which may see them working more closely together in the future.

Japan country report
In addition to the usual set of music industry statistics and news briefs, the latest issue of Music & Copyright includes a detailed Japan music industry profile. Japan is the second-largest recorded music market in the world. According to the IFPI, the country ended 2014 behind the US in terms of overall trade revenue but was the global leader for trade income from sales of physical formats. Japan is unique among the leading markets in so many ways: Its trade revenue from sales of physical formats still accounts for more than 80% of total record company income. After several years of decline, digital earnings have started rising again and subscription services are showing considerable promise. Major record company dominance is ably challenged by a number of local independent companies. Japan also boasts one of the world’s largest authors’ societies in terms of royalties collected and it has a buoyant live sector.

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Music & Copyright is published by Ovum.

New issue of Music & Copyright with Sweden country report

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

Mid-year trade results hint at a flat year for global recorded music sales
Almost all of the world’s biggest recorded music markets have published their mid-year sales figures. An assessment that the total global trade revenue from the sale of physical and digital recorded music and income from music access services will return to growth suggests the industry is heading for a stable year. Although music subscription services are continuing to experience gains in most of the leading markets, it remains on a knife edge as to whether the rise in record company earnings from access services this year will fully offset the lower income being generated by download and CD album sales. There have been some very positive mid-year results from countries that have suffered steady annual declines in recorded music sales for several years. But such is the ongoing dominance of a small number of markets, a return to global growth remains in the hands of the few.

SIAE reports slight growth in music repertoire collections in 2014
Italian authors’ society SIAE has reported a return to growth for royalty collections in 2014. Following a difficult 2013 when music collections fell and overall royalty income suffered a decline, SIAE said authors’ earnings from music repertoire edged up in 2014 with growth also reported for collections from dramatic works as well as opera. Although income from movies, literary works, and visual arts suffered a decline, the overall collection total for SIAE was positive. Digital music collections rose for the second consecutive year, but, as a share of total income, the collection source is still very low.

Rights holders use carrot and stick approach for music sampling
The art of music sampling had its heyday prior to the music industry’s sharp reversal of fortune. However, rights holders are increasingly eager to monetize the practice. Chasing unauthorized samplers through the courts is one way to do this, although EMI Production Music is choosing to give users of uncleared samples the opportunity to come clean, while also offering a spot of forgiveness for past sampling transgressions. But EMI’s initiative is a short-term promotional exercise above everything, and the threat of litigation will remain the primary mode of licensing enforcement — and revenue collection — going forward. However, those artists looking to legitimately use samples in their compositions are not finding it easy to clear rights and publishers really need to simplify their systems to accommodate them.

Sweden country report
In addition to the usual set of music industry statistics and news briefs, the latest issue of Music & Copyright includes a detailed Sweden music industry profile. Sweden has quickly become the world leader in terms of music access, with home-grown service Spotify dominating not only record company earnings from digital music, but also total Swedish recorded music trade revenue. There have been signs of a slowdown in music subscription take-up, but earlier this year the local IFPI branch said it was confident there was still considerable room for growth. The IFPI made its comments after mid-year figures hinted at a return to growth in total trade revenue after a slight dip in 2014. One of the major beneficiaries from the digital growth has been STIM, the authors’ society, with collections last year rising to record levels on the back of authors’ growing digital earnings.

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Music & Copyright is published by Ovum.

New issue of Music & Copyright

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

PRS for Music begins legal action against SoundCloud
UK authors’ society PRS for Music has begun legal action against the online audio streaming service SoundCloud. In a notice to its members, Karen Buse, executive director, membership and international at PRS, said the decision came after “careful consideration” and followed “five years of unsuccessful negotiations” to agree a license. No license means PRS members are not being paid for music streamed by the service. SoundCloud responded to the lawsuit by claiming that it does not need a license for its existing service and said it has deals in place with thousands of rights holders including record labels, publishers, and independent artists. The service described PRS’s actions as regrettable given that commercial negotiations with the authors’ society were ongoing.

Live music competition heats up in Germany as Live Nation muscles in
In August, the global events giant Live Nation Entertainment (LNE) formed Live Nation Concerts Germany (LNCG) with the local concert promoter Marek Lieberberg to promote concerts and festivals in Germany, Austria, and Switzerland from the beginning of next year. LNE said at the time that Lieberberg was the fifth largest promoter in the world and that the deal would add more than 700 shows and 2 million fans to LNE’s current platform of 23,000 shows for 60 million fans across more than 40 countries. Under the terms of the deal, Marek Lieberberg will be chief executive officer of the new division with Andre Lieberberg serving as president. However, LNE has already failed once to crack the German live music sector and there are no guarantees the company will succeed this time around.

Crunch time for SFX as company faces possible bankruptcy and break-up
Live music promoter SFX Entertainment is facing the real prospect of being broken up and sold after chairman and CEO Robert F.X. Sillerman failed in his move to take the company private. Sillerman has embarked on a second attempt to take back the company that went public at the end of 2013 but, with a new deadline of the beginning of October – a month that will also see Sillerman face up to legal claims from ex-business acquaintances that they were partly behind the founding of SFX – the future of the company looks bleak. Revenue keeps rising but so do losses and the ongoing uncertainty surrounding the future of company has driven up talk of bankruptcy and driven down the share price.

Physical formats are still the backbone of Japan’s recorded music sector
The Japanese music trade association, the RIAJ, has reported positive physical and digital recorded music trade figures for the first half of this year. Production levels of physical formats and record company earnings from digital sales and services increased year-on-year between January and June raising speculation that the total trade sales for the full year may return to growth after two consecutive years of decline. Although local record companies will welcome a rise in revenue, physical formats still account for around three-quarters of total trade income. Digital sales have proved resilient in the last year or so after some big annual falls, but should sales of CDs start going the same way as they have in many developed markets in the West, Japan’s recorded music sector may face some very tough times again.

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Music & Copyright is published by Ovum.

New issue of Music & Copyright with Brazil country report

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

Music Piracy: No longer headline news, but the problem persists with big brand support
The fifth annual survey by Music & Copyright of online music distribution through unauthorized music sites and services has found little change to the status quo. Although the number of sites that are now blocked by ISPs around the world continues to rise, so does the number of sites offering unlicensed content. Moreover, blue-chip companies and media-content services are still unwittingly supporting the sites through advertising placements. In a recurring theme, most companies notified of the presence of advertising on pirate sites stated a willingness to have their adverts removed but offered little assurance that dealing with misplaced advertising would become a high priority. There are a number of ongoing initiatives to raise awareness of the dangers of misplaced advertising, but the size of the task in hand provides little in the way of optimism that the situation will change any time soon.

SIAE reports flat year for Italian live entertainment in 2014
The Italian live events sector experienced a flat 2014 according to new figures published by the Italian authors’ society SIAE. Although box office receipts edged up slightly, total attendance at events was down. The sectors with the best results were exhibitions and shows, travelling shows and amusements, sports and theater. A decrease in the number of live music shows staged resulted in a fall in box office receipts and total turnover for the sector.

Music start-ups take digital to the next level
Digital innovation has opened up innumerable opportunities for music industry start-ups, which are often able to operate on a shoestring from a founder’s garage until they grab the attention of Silicon Valley’s VCs. While the likes of Spotify and Pandora operate in the limelight, a huge number of outfits develop their often groundbreaking services in the wings, developing new apps, running live music operations, or promoting emerging artists. But some of these startups have become good-sized businesses in their own rights and are starting to interest record companies, artists, and brands.

Brazil country report
In addition to the usual set of music industry statistics and news briefs, the latest issue of Music & Copyright includes a detailed Brazil music industry profile. Trade revenue from recorded music in Brazil increased for the fourth consecutive year in 2014 with higher digital sales more than offsetting a decline in physical format sales. Record company earnings from music streaming rose sharply and accounted for just over half the digital total. UMG held on to the leading position it gained from SME in 2013 despite suffering a slight fall in market share. Umbrella rights organization ECAD reported growth in royalty collections and distributions in 2014. Difficult trading conditions impacted on the performance of the country’s biggest live music promoter Time for Fun in 2014. However, the company started this year well with a big rise in ticket sales and events promoted.

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Music & Copyright is published by Ovum.

New issue of Music & Copyright with Mexico country report

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

European Parliament adopts MEP Julia Reda’s copyright report
The European Parliament has voted by a large majority to adopt MEP Julia Reda’s report on the EU Copyright Directive 2001/29/EC. The report addressed provisions in the copyright directive that its author said had not been able to keep step with the increase of online cross-border cultural exchange. It called for an urgent review of copyright legislation and for a harmonization of copyright across Europe. Following the vote, a number organizations welcomed the Parliament’s backing of a fair balance between the rights and interests of creators and consumers, but their differences on what the vote represented and what course of action the EU should now take suggests a difficult few months ahead before the European Commission presents its specific copyright reform proposals.

Positive first six months of 2015 for recorded music sales in Germany
Figures published by the German music trade body Bundesverband Musikindustrie (BVMI) show total consumer spending on recorded music grew 4.4% in the first six months of this year compared with the same period of 2014. A big jump in music subscriptions was the main reason for the growth, but the continued revival of the vinyl LP and an unexpected rise in sales of album downloads also boosted overall sales. Despite a decline in spending on CD albums, the format still accounted for the majority of music retail sales. The boom in streaming sales meant combined spending on music subscriptions and advertising income from streaming services accounted for almost 13% of total sales.

ZAiKS bemoans low digital gains as collections edge down in 2014
Polish authors’ society ZAiKS has reported its financial statements for 2014. At a press conference, ZAiKS’ vice president Marek Hojda and CEO Piotr Wąsaty said total collections were down slightly compared with 2013, but were still the second highest in the society’s history. Moreover, the administration rate was down, to 16.4%, from 17.1%. Broadcasting was the biggest income source for ZAiKS. However, despite an increase in public service TV income, a decrease in public service radio and commercial TV collections meant overall broadcasting income was down. A big jump in cinema collections boosted public performance earnings but the ongoing shift to digital from physical recorded music formats meant mechanical collections for ZAiKS continued to fall.

Mexico country report
In addition to the usual set of music industry statistics and news briefs, the latest issue of Music & Copyright includes a detailed Mexico music industry profile. Mexico is Latin America’s second largest recorded music market and the region’s biggest live market. Although record company income from the sale of recorded music is suffering from the steady transition away from physical formats and, more recently, digital downloads, rising interest in streaming offers more than just a glimmer of hope for a return to trade revenue growth. SME maintained its lead as the biggest record company in Mexico, although a rise in share for second-placed UMG has closed the gap on the leader. Mexico’s biggest events company, Interamericana de Entretenimiento, suffered a fall in live music income in 2014. However, this year has started well for the promoter with revenue growth and a big jump in net income.

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Music & Copyright is published by Ovum.

New issue of Music & Copyright with Russia country report

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

Pressure shifts to Pandora as SiriusXM agrees pre-1972 deal
US satellite radio service SiriusXM has agreed on a settlement with the three major record companies and ABKCO Music & Records over the use of music fixed in copyright before February 15, 1972 (pre-1972 sound recordings). The settlement followed a California district court ruling in October that the broadcaster should pay royalties on the disputed recordings. The issue of royalties payable on the pre-1972 works has already seen a number of legal cases heard in several district courts in the US. Two members of the 1960s band the Turtles, Howard Kaylan and Mark Volman, who later became known as Flo & Eddie, have led the charge against the non-payment of royalties by SiriusXM and online radio service Pandora. Although SiriusXM is still battling against Kaylan and Volman despite legal defeats in New York and California, the broadcaster has decided to settle with the record companies rather than appeal the California court’s interpretation of the state’s copyright law, which means that the online radio service Pandora is now under the pre-1972 sound recordings spotlight.

SGAE membership approves accounts for 2013 and 2014
Spanish authors’ society SGAE has published its annual accounts for 2013 and 2014 after approval from its membership at the June annual general meeting. SGAE has experienced a turbulent last few years with arrests of senior executives for misappropriation of funds followed by antitrust investigations over high tariffs for live performance and broadcast fees. The collection society still has a long way to go to repair the damage caused, but SGAE said in June that total revenue grew last year compared with 2013 despite the difficult trading conditions which affected some of the main income sources. Digital collections registered good growth and mechanicals benefitted from the big rise in sales of CD albums.

Music TV still plays the world’s global juke box
Music TV has come a long way since the early days of MTV, with music videos having made the leap from being pure promotional collateral to premium content able to pay its own way. YouTube and Vevo have essentially replaced broadcast music television in the living room with on-demand tracks across multiple devices. But while large players dominate the space, there is still room for innovation, especially on the live music side of the business where brands are also eyeing the opportunity.

Russia country report
In addition to the usual set of music industry statistics and news briefs, the latest issue of Music & Copyright includes a detailed Russia music industry profile. For more than a decade, the two major music industry sectors, recorded and live, experienced very different fortunes in Russia. Recorded music sales suffered under the weight of piracy and the live sector went from strength to strength. However, in the last couple of years, the situation has turned on its head with recorded music on the up and live music suffering a decline. Rising digital sales have boosted record company earnings and there is real hope that the country may be just about to start delivering on its potential. In contrast, Russia’s live sector has been hit by a devaluation in the ruble and souring relations with the West over Ukraine that have forced the country’s economy into a deep and subsequently damaging recession.

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Music & Copyright is published by Ovum.