Live royalties growth surpasses radio/TV in 2018
Music collections grew almost 2% in 2018, generating €8.5 billion, with the growth of live/background music royalties surpassing that of frontrunner TV/radio.
The most recent figures released by Cisac, the association that represents global copyright collection societies, show the traditional revenue streams of TV, radio, live and background music – that played in restaurants, bars and clubs – “continue to be the backbone of royalties collections”, despite the “mass migration to digital channels” in recent years.
In Cisac’s Global Collections Report 2019, which documents overall royalties collected in the areas of music, audiovisual, visual arts, drama and literature, the association’s director general, Gadi Oron, puts “comparatively modest” growth down to the “devaluing effect of the exceptionally strong euro”.
Revenue from live and background music combined has grown 0.8% from 2017 to €2.6bn, while TV and radio has seen a decline of 3.1%, generating €3.3bn.
In conjunction with TV/radio’s decline, live/background royalty collections surpass that of broadcast in Italy and Chile. Live and background royalties reach €322 million in Italy (-0.9% year-on-year) and CLP10,960m, or €13.43m, in Chile (+8.4% YOY).
“The large traditional revenue streams continue to be the backbone of royalties collections”
Europe remains the largest region for collections, generating over 50% of global music revenues. According to the report, the live music sector “continues to grow healthily across Europe, with strong demand for concerts and festivals.” Live/background collections lead the way in Europe, rising 1.4% in 2018 to €1.7bn, and by 11% over the past five years.
Live collections are also up in Asia-Pacific by 3.1% to €306m and 2.2% in Canada/USA to €345m. Elsewhere, royalties are down -0.9% in Africa (17m) and 9.5% to €194m in Latin America and the Caribbean, where live music still remains the leading source of collections.
Digital is where Cisac president Jean-Michael Jarre sees the “future”, with increasing subscription revenues driving growth of 185% over the past five years.
“More than ever, societies are working in a landscape of fragmenting income sources,” writes Oron. “This calls for more versatility: protecting the large traditional collections streams of live, background and broadcast, while striking new deals to monetise creators’ works on YouTube, Facebook and other digital platforms. The role of authors’ societies in generating monetary value for millions of creators has never been more vital.”
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SGAE postpones upcoming reform vote
Spanish collection society SGAE (Sociedad General de Autores y Editores) has postponed its general assembly – due to take place in October – to January 2020, when a number of current members will have departed from the society.
Members of the controversial SGAE, which was expelled from international authors’ rights association Cisac in May, were due to vote on statute reforms at the assembly on 15 October.
The society has failed to obtain a member majority on changes to statutes on three separate occasions. The reforms are necessary in order for the society to comply with European Union intellectual property law and with demands made by Cisac and Spanish Minister of Culture, José Guirao.
The decision to postpone the vote comes after members including Julio Iglesias, José Luis Perales, Iván Ferreiro, Ramón Arcusa (Dúo Dinámico) and Jorge Ilegal asked to terminate their membership to the society. By moving the vote to January, the departing members will no longer be able to participate.
“SGAE is postponing its assembly to 2020 to guarantee legal certainty following the request from the Ministry of Culture,” reads a post on the society’s Facebook page.
“SGAE is postponing its assembly to 2020 to guarantee legal certainty following the request from the Ministry of Culture”
The Ministry of Culture had demanded that SGAE “respect” members that wanted to leave, after various members, including Southern Music Española SL, Peermusic and Lugar Music, complained that the society had attempted to limit their right to vote after they announced their intention to leave.
However, according to the society, the Ministry of Culture had also demanded it implement article 27 of it current statutes, “under which asking to leave SGAE constitutes the loss of the right to vote in the general assembly.”
According to the SGAE, the Ministry of Culture has created a “legal paradox”. By moving the assembly to 2020, reads the society’s statement, any doubts relating to legal rights, are dissipated.
SGAE is no stranger to controversy. The society recently received a €2.95 million fine for anti-competitive practices by the Spanish competition regulator and has been linked to a scandal known as ‘the wheel’ (la rueda).
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SGAE suffers third statute reform failure
Spanish collection society, Sociedad General de Autores y Editores (SGAE), is facing increased pressure from the government and international author’s rights association Cisac, after failing to make reforms to its statutes.
The beleaguered collection society lacked member votes to implement reform at its General Assembly in Madrid on Monday (24 June). 62.8% of members voted in favour of the changes proposed by SGAE president Pilar Jurado, 4% short of the two-thirds majority required.
Of the 18,000 eligible members, only 1,356 participated in the vote.
Changes to the society’s statutes are necessary in order to comply with current European Union intellectual property law. In the run up to the vote, Jurado stressed that the society was facing its “last opportunity” and that failure to comply with the changes would be “terrible for creators”.
In failing to reform the collection society has also failed to meet the demands of Spanish Minister of Culture José Guirao and the International Confederation of Authors’ Societies
In failing to reform – for the third time – the collection society has also failed to meet the demands of Spanish Minister of Culture José Guirao and the International Confederation of Authors’ Societies (Cisac).
Last week, the National Assembly rejected Guirao’s call for governmental intervention in light of SGAE’s upcoming General Assembly. Following the decision, Guirao stated that failure to pass the reforms would leave “no other option other than to strip SGAE of its authority.”
In May, Cisac temporarily expelled SGAE as a member, due to the society’s failure to convince the body of its commitment to reform. The sanction, which “can be lifted or adjusted at any time” provided positive change is made, remains in place.
Earlier this month, the society received two fines from the Spanish competition regulator, one of €3.1m in relation to “abusive” 10% concert tariffs, and the other of €2.95 for anti-competitive conduct.
SGAE has been embroiled in controversy surrounding a scandal known as ‘the wheel’ (la rueda) since 2017.
Cisac expels controversial Spanish member
The International Confederation of Societies of Authors and Composers (Cisac) has voted to expel Spanish society SGAE for a one-year period, following the society’s failure to convince the body of its “commitment to reform”.
The decision to expel SGAE, known as the Sociedad General de Autores y Editores, was made at Cisac’s annual assembly in Tokyo. The expulsion follows Cisac’s resolution to undertake a sanctions process against SGAE in December, “in view of the society’s breaches of Cisac rules”.
The expulsion is set to last for one year but “can be adjusted or lifted at any time”, provided that the Cisac board of directors concludes that SGAE has made sufficient progress towards implementing its requirements. Cisac recommended a series of changes to its rogue Spanish member following an in-depth investigation which concluded in May last year.
“Today’s vote to proceed with the sanction of a one-year expulsion follows an in-depth analysis of recent reforms set in motion by SGAE’s new President, Ms Pilar Jurado,” reads a Cisac statement.
“Further important technical work and changes are needed and expected by CISAC to ensure SGAE’s compliance with the Confederation’s professional rules”
“While a number of welcome changes have been proposed, they have not yet been approved by the SGAE General Assembly. Further important technical work and changes are needed and expected by CISAC to ensure SGAE’s compliance with the Confederation’s professional rules for member societies.”
SGAE appointed Spanish soprano singer Pilar Jurado as president in February following a vote of no confidence against former chief José Ángel Hevia, who held the position for just three months.
Jurado states that “Cisac is giving SGAE the opportunity to decide its own future”, and called on members to support her proposed reforms in the General Assembly in order for the society “to leave this situation behind us”.
Earlier this week, minister of culture José Guirao demanded SGAE produce a detailed outline of the steps it would take to comply with regulations. Failure to do so would result in intervention from the court.
SGAE has been at the centre of a scandal known as the wheel, or ‘la rueda’, for a number of years. The scam, which saw SGAE members and TV execs create “low-quality music” to broadcast on late-night TV, allegedly brought in several millions in performance royalties over the years.
India’s IPRS readmitted to Cisac after 2016 expulsion
India’s performance rights organisation, the Indian Performing Right Society (IPRS), has been readmitted to international authors’ rights association Cisac as an associate member after two years of reform.
IPRS was temporarily expelled from Cisac (International Confederation of Societies of Authors and Composers) in 2016 after a compliance review found “serious shortcomings and lack of compliance with Cisac’s rules”, according to the organisation, which represents 239 collection societies and performing rights organisations in 122 countries.
That decision, taken by Cisac’s board and general assembly, has now been reversed following “major reforms” in corporate governance, transparency, licensing, collections and distribution of royalties.
The society has also been re-granted registration under India’s copyright law by the Indian government.
“We are delighted to have IPRS back in our global network, following extensive reforms”
Cisac director-general Gadi Oron says: “India is an important market with a huge potential for creators and the creative industries. We are delighted to have IPRS back in our global network, following extensive reforms conducted at the society with Cisac’s support and guidance.
“Cisac’s best practice rules ensure high standards and mutual trust among our member societies and, as the India case shows, they also act as a lever for positive reforms where needed.”
“This homecoming is the occasion to acknowledge the decisive support received from the government of India when all hope was lost, as well as the unsparing assistance from and support of Cisac towards transparency and a compliant IPRS, for which the creative community will be forever grateful,” adds IPRS chairman, and former Cisac vice-president, Javed Akhtar. “Now we must look to the future.
“I want to assure all those who entrust their copyrights to the ‘new IPRS’ of our determination to become, in the shortest possible time, a world-class society, accurately tracking and monetising all usage of their musical works in the country.”
CISAC readies sanctions against SGAE
Cisac – the association representing the world’s copyright collection societies – has announced plans to impose sanctions against SGAE, amid continued alleged rule-breaking by its rogue member from Spain.
At a meeting of its board of directors yesterday (4 December), Cisac (the International Confederation of Societies of Authors and Composers) resolved to initiate its sanctions process against SGAE, which could result in the Spanish society’s expulsion.
“Cisac’s board of directors, at its meeting of 4 December 2018, discussed the serious situation at SGAE and the society’s breaches of Cisac rules,” reads a statement from the association. “In view of SGAE’s failure to remedy these breaches, the board decided to launch a sanctions procedure under Cisac’s statutes.
“This procedure could result in various sanctions and measures, including the expulsion of SGAE from Cisac.”
SGAE (Sociedad General de Autores y Editores) has been embroiled in controversy since June 2017, when police raided its offices in search of documentation relating to an alleged scam dubbed ‘the wheel’ (‘la rueda’), in which SGAE members and TV execs allegedly conspired to create “low-quality music” – often reworked versions of songs in the public domain – then broadcast on late-night TV, generating performance royalties collected by SGAE.
SGAE maintains it is “totally willing to comply” with Cisac’s recommendations
Royalties from music licensed under la rueda account for around 70% of monies collected by SGAE from television, despite reaching only around 1% of the TV audience, according to Spanish paper El País.
In July, four of the five big music publishers – Warner/Chappell, Sony/ATV, Universal Music Publishing and BMG – along with the smaller, US-based Peermusic, wrote to the society requesting to pull their international catalogues, which include the likes of Bruce Springsteen, the Rolling Stones, Radiohead, Lady Gaga, Beyoncé and Enrique Iglesias, collectively comprising almost 60% of broadcast collections in Spain, from SGAE.
In a 65-page report published in May, Cisac found “serious concerns” relating to “distorted and inequitable distribution of royalties” at SGAE, and ordered the society to overhaul the way it does business.
While SGAE maintains it is “totally willing to comply” with Cisac’s recommendations – including the appointment of a new director-general (Gerardo Rodríguez, hired last month) and the creation of an external monitoring body, the association says SGAE has failed to fix its shortcomings. A final ruling is scheduled for Cisac’s annual general meeting in May 2019.
European PROs drum up support before second Article 13 vote
Global music rights bodies, including the International Confederation of Societies of Authors and Composers (Cisac), European Grouping of Societies of Authors and Composers (Gesac) and International Council of Music Authors (CIAM), today launched Europe for Creators, a new venture aimed at securing a vote in favour of the controversial EU Copyright Directive on 12 September.
The second vote follows an earlier defeat for the bill, on 5 July, which was met with disappointment by much of the music industry. Music industry bodies, especially collection societies/performance rights organisations, and their counterparts in the tech sector are sharply divided on the merits of the new directive, especially its controversial Article 13: songwriters’ representatives say the legislation would ensure fair remuneration of creators when their works are used online, while internet freedom activists, including the web’s creator, Tim Berners Lee, have said it would transform the internet into a “tool for the automated surveillance and control of its users”.
Article 13, if passed, would compel “online content sharing service providers”, such as social networks or video-sharing sites like YouTube, to take “effective and proportionate” measures to combat the sharing of copyrighted works.
Internet freedom activists claim this would effectively ban memes – the internet fads, often in the form of a humorous picture or video overlaid with text, that spread virally across the web – leading creators to repackage popular memes sans copyrighted material, to highlight what they see as the absurdity of the proposed legislation.
This, however, is not true, says Europe for Creators: memes and animated gifs are already protected under existing legislation, Directive 2001/29/EC, with companies such as Google – the owner of YouTube, a platform frequently targeted by those wishing to close the ‘value gap’ between the online use of music and payment of creators – simply wishing to “hide” from their responsibilities to fairly compensate authors.
“We have enriched the lives of Europeans, and now we are calling on Europe to act”
In a launch statement, Europe for Creators says it calls on “all citizens to preserve culture and democracy in Europe” in the face of what it calls a “massive lobbying campaign” by tech companies, who, it is alleged, are profiting from the use of music online without fairly remunerating creators.
“Digital economic powers continue to profit as working artists struggle to make ends meet,” says Véronique Desbrosses (pictured), Gesac’s general manager. “The balance between the revenues generated by internet platforms and the money they give to the creators who are responsible for their success is entirely distorted.”
In the coming days, the coalition will send an open letter to all members of the European parliament, “activat[ing] them in this fight”, as well as organising “strike events” to take place in several European cities in the run-up to the vote.
“The creative and cultural industry in the European Union represents €536 billion per year, more than the combined revenue of the automotive and telecoms sectors, and is responsible for 12 million jobs,” says Desbrosses. “We have enriched the lives of Europeans, and now we are calling on Europe to act.”
Cisac: Live now European songwriters’ biggest earner
Live/background music is now the biggest source of revenue for songwriters and music publishers in Europe, reveals Cisac’s 2017 annual report, overtaking TV and radio for the first time.
Cisac, which represents authors’ rights societies internationally, saw total music collections on behalf of its members grow 6.8% to €8bn in 2016, boosted by a 52% increase in digital revenues (such as those from streaming services) and continued growth in live performance royalty payments, mirroring the trend seen in 2015.
While TV and radio still make up biggest segment globally, income from live and ‘background’ music, such as that played in nightclubs, bars and restaurants, overtook broadcast it in Europe, reflecting both “pressure on rates from broadcasters” and, particularly, the health of the live sector.
In total, royalty collections from live and background music were worth €2.7bn globally, a 2.4% increase on 2015. Overall collections, meanwhile, rose for the third year in a row, growing 19% compared to 2012.
The numbers were released today in the Cisac Global Collections Report, which collates and analyses 2016 data received from the organisation’s member societies. Cisac (Confédération Internationale des Sociétés d’Auteurs et Compositeurs, International Confederation of Societies of Authors and Composers) represents 239 collection societies and performing rights organisations in 123 countries.
“The system of collective management of creators’ rights is robust, successful and ready for more growth”
“This year’s report shows the system of collective management of creators’ rights is robust, successful and ready for more growth,” says Cisac director-general Gadi Oron. “The big traditional revenue streams, led by broadcast and live performance, remain stable and strong. Digital royalties continue to surge and in some markets already overtake other forms of income.
“The figures we’re releasing today reflect our societies’ relentless effort to be more efficient and innovative, and drive income growth.”
Cisac’s president, electronic music pioneer Jean-Michel Jarre, warns, however, that while digital revenues are growing fast – 51.4% in 2016, to just under €1bn – creators are still being shortchanged by some streaming services. “This is a vast sector of cultural and economic activity, worth an amazing €9bn worldwide,” he comments. “Despite its growth, however, collections are nowhere near the level they should be.
“Large industries that use creative content are driving down the value of our works. A simple illustration of this is the ‘transfer of value’ in the digital market where platforms such as YouTube are paying mere crumbs to authors. There is no greater priority that we ask from governments today than a solution to the transfer of value.”
Cisac, Aripo partner for African creative growth
Cisac, the world’s largest association of collection societies and performance rights organisations, has entered into a ‘memorandum of understanding’ with the African Regional Intellectual Property Organisation (Aripo) aimed at strengthening copyright and promoting creative-sector growth in Africa.
The African market was the biggest growth area for Cisac members in 2015, with royalty payments from live and background music increasing 33.2% year on year.
Despite this steady growth, total royalty collections in the continent stood US$68.6 million – under 1% of the global total of $9.5 billion.
According to Aripo – an intergovernmental organisation whose membership comprises 19, mostly English-speaking, countries (a similar organisation, Oapi, represents francophone Africa) – the partnership with Cisac “paves the way for joint projects on strengthening copyright, technical exchange, education and training of organisations collecting revenues for creators”.
Speaking at the signing of the agreement, at Aripo’s headquarters in Harare (Salisbury), Zimbabwe, yesterday, Cisac director-general Gadi Oron said: “In today’s economy, creators and creative industries are a huge driver of growth and jobs, and this is only going to escalate in the future. African governments, like their counterparts globally, are realising that to nurture this potential, more actions are needed to promote and protect creators’ rights.
“Africa has it all in creativity, but there is a need to develop and implement strategies to promote and support the growth of the creative industries”
“We look forward to a close collaboration with Aripo, including opportunities for research that can demonstrate the huge economic benefits of the creative industries in Africa. Today’s agreement is a positive forward step, bringing together two hubs of international expertise to work on improving the environment for the creative sector”.
Aripo’s director-general, Fernando dos Santos, added: “Africa has it all in creativity, but there is a need to develop and implement strategies to promote and support the growth of the creative industries. More studies on the creative industries’ contribution to the national economy have to be undertaken to assist policymakers to make informed decisions on copyright matters.
Within Aripo member states, only Malawi, Kenya and Tanzania have [undertaken] such a study […] and findings showed that the creative industries contribute 3–5% GDP of national economy. This should act as a catalyst for African governments to continue supporting and promoting the creative industries.”
Cisac (the International Confederation of Societies of Authors and Composers) represents 239 collection societies and performing rights organisations in 123 countries.
Global live royalties up 8.5% YoY in 2015
Global royalty payments for public performance rights grew 9.1% to €6.8 billion last year, accounting for 78.8% of all collections, Cisac’s 2016 annual report has revealed.
As in 2014, TV and radio made up the biggest chunk of those collections, with over half (53.7%) of all performing rights-royalties generated from traditional broadcast, although live had another strong year, growing 8.5% to maintain its position as the second-largest source in revenue in music.
The biggest growth for live and ‘background’ music (such at that played in nightclubs, bars restaurants) was in Africa (33.2% on a fixed-currency basis) and Latin America (20.2%).
Total royalty collections for all sectors in 2015 totalled more than €8.6bn, up 8.9% from 2014.
The biggest growth for live music was in Africa and Latin America
“Cisac members’ collections in 2015 experienced unprecedented growth of close to 9% year-on-year and, for the first time, broke the €8bn mark,” comments Cisac director-general Gadi Oron (pictured). “This is testament to the continued development of the global collective management network and the increased efforts of our members on improving their operations, adjusting their licensing solutions and responding to market demands.
“The strong growth experienced in all regions of the world in which Cisac members are active is particularly encouraging. It reflects the grassroots work undertaken in many countries by Cisac and its members to promote favourable laws, support societies’ operations and further improve their services to affiliated creators and publishers.”
Cisac (International Confederation of Societies of Authors and Composers) represents 239 collection societies and performing rights organisations in 123 countries.