Music Creators’ Earnings in the Digital Era

From your favourite rock and pop artists, to film and TV scores, to classical and ambient, music is often the backdrop to our lives. But how do artists earn money from their music? Before COVID-19 lockdowns, artists earned much of their income from live performances. But the pandemic changed that: artists could no longer rely on live performances to make a living and had to look at their other sources of income. This shift brought into sharp focus several issues around streaming, including the way in which artists are remunerated.

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  • Fairness Rocks news

    SOURCE: Intellectual Property Office

    Date: May 12, 2022

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  • CISAC releases its 2022 Annual Report

    Paris – 26 May 2022 – CISAC has today published its 2022 Annual Report, outlining its work supporting the world’s largest network of authors societies.

    CISAC’s members comprise 228- authors societies who together manage the rights of over 4 million creators from the music, audiovisual, visual arts, drama, and literature repertoires

    The 2022 Annual Report shows the Confederation’s diverse services including lobbying, development of best practices, technology, and the systems to support data exchanges, help identify works and pay royalties quickly and accurately.

    Read the report below

  • Fairness Rocks news

    SOURCE: CISAC

    Date: May 26, 2022

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  • World Intellectual Property Indicators 2021

    This authoritative report analyzes IP activity around the globe. Drawing on 2020 filing, registration and renewals statistics from national and regional IP offices and WIPO, it covers patents, utility models, trademarks, industrial designs, microorganisms, plant variety protection and geographical indications. The report also draws on survey data and industry sources to give a picture of activity in the publishing industry.

     

  • Fairness Rocks news

    SOURCE: wipo.int

    Date: 2021

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  • Performer Payments from Streaming

    This study sets out to explain if and when performers share in monies generated through the exploitation of their performances via streaming services. When they do, it also explains how those payments are negotiated, what share of any streaming income performers are likely to receive, and other complexities which can impact on what payments are actually made.

    Read the full study below:

  • Fairness Rocks news

    SOURCE: CMU Insights

    Date: September 2021

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  • Super-Low Carbon Live Music: a roadmap for the UK live music sector to play its part in tackling the climate crisis

    In this roadmap we outline a set of clearly defined and measurable targets that the live music sector could adopt to play a leading role in meeting the Paris Agreement on climate change. In our discussions and interviews with people from across the sector, we found widespread commitment to reassembling practices post Covid-19 so that they are fundamentally more sustainable. There are many excellent examples of super-low carbon practices already happening, however, progress must be rapidly accelerated and substantial shifts in industry practice are needed.

    Download the full document below

  • Fairness Rocks news

    SOURCE: Tyndall Center for Climate Research

    Date: June 2021

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  • Estimating the Size of the Global Song Streaming Data Gap

    The Ivors Academny, the UK’s professional association for songwriters and composers, is raising awareness of the need for music industry reform to meet the challenges and opportunities of the streaming era.

    Missing song credit information is a significant issue facing the industry and streaming is the area in which this problem is most visible and growing. Here the lack of accurate and complete data is resulting in the royalties due to songwriters and rightsholders being delayed, unallocated and/or mis-allocated to songs that have already received payment. Too often royalties are pooled into a “black box” to be distributed according to analogy0based policies.

    Download the full document below

  • Fairness Rocks news

    SOURCE: Ivors Academy

    Date: August 2021

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  • Guidance –Should I be engaged as a Session Musician or Featured Artist?

    Knowing whether you should be engaged as a session musician or a featured artist can often be obvious, but there are times when your role can be difficult to determine. This can be particularly difficult for lead vocalists going in to work with another artist or producer, but can also apply to an instrumentalist taking on a lead role.

    Download the Guide Below

  • Fairness Rocks news

    SOURCE: FAC

    Date: June 21, 2021

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  • The Beijing Treaty: A step forward in the protection of related rights in audiovisual performances

    In the midst of the economic and social paralysis arising from the COVID 19 pandemic, the tireless discipline of law has prevailed as always, if anything with increased activity. The Beijing Treaty on Audiovisual Performances (BTAP, hereinafter the “Treaty”) came into force on 28 April 2020 in the first thirty contracting parties (the minimum number required). It was a historic milestone in the area of rights related to copyright. Switzerland was the first State to join the list and, at present, 42 states are contracting parties to this Treaty.

    Download the Article Below

  • Fairness Rocks news

    SOURCE: Kluwer Copyright Blog

    Date: June 18, 2021

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  • ECSA’S Vision On How Europe Can Prevent Buyout Contracts

    In Europe and all over the world, audiovisual composers and their organisations have launched awareness and education campaigns to stop buyout contracts, which deprive them from a fair and proportionate remuneration. ECSA fully supports those campaigns and pays tribute to all the composers standing against buyouts.

    Download the full document below.

  • Fairness Rocks news

    SOURCE: ECSA

    Date: May 2021

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  • UK performers say post-Brexit visa rules spell disaster

    LONDON (AP) — Leading British actors including Ian McKellen, Patrick Stewart and Julie Walters warned the government on Tuesday that the U.K. culture sector faces irreparable damage unless artists can tour the European Union without visas.Since Britain made its final split from the EU at the end of 2020, U.K. citizens can no longer live and work anywhere in the bloc. British artists now have to comply with differing rules in the 27 EU nations, negotiating visas for performers and permits for equipment.

    Read More: https://markets.businessinsider.com/news/stocks/uk-performers-say-post-brexit-visa-rules-spell-disaster-9817868

  • Fairness Rocks news

    SOURCE: Insider

    Date: February 16, 2021

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  • Reversion rights in the European Union Member States

    The working paper presents the results of the mapping of provisions allowing authors and performers to reclaim their rights (reversion rights) which are currently or were historically a part of the national laws of the European Union Member States. The mapping is a result of a collaborative project between CREATe (University of Glasgow) and IPRIA (University of Melbourne), with the reCreating Europe consortium. The impulse came from the introduction of the right of revocation in art. 22 of the 2019 Directive on Copyright in the Digital Single Market, a reversion right following a use-it-or-lose-it logic.

    Read the full paper attached

  • Fairness Rocks news

    SOURCE: CREATe

    Date: November 19, 2020

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  • CISAC and BIEM submission on the Proposed Rulemaking on the Public Musical Works Database and Transparency of the MLC

    The International Confederation of Societies of Authors and Composers (“CISAC”) and the International Organisation representing Mechanical Rights Societies (“BIEM”) would like to thank the U.S. Copyright Office (“the Office”) for the opportunity to provide comments on the Proposed Rulemaking on the Public Musical Works Database (“Database”) and Transparency of the Mechanical Licensing Collective (“MLC”). This submission follows our previous comments to the Office, in particular on the Notifications of Inquiry from September 2019 and April 2020 (SG19-1116; SG19-1284; SG20-0614)…

    Read The Full Submission Attached

  • Fairness Rocks news

    SOURCE: CISAC

    Date: October 19, 2020

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  • United States Copyright Office Report: An Analysis of DMCA Section 512

    Since its establishment in 1998, as part of the Digital Millennium Copyright Act (“DMCA”), section 512 of title 17 has both provided critical guideposts for the expansion of the internet and produced widespread disagreement over its operation. This Report is the first full analysis of whether section 512 is working effectively in achieving its aim of balancingthe needs of online service providers (“OSPs”)1with those of creators.

     

  • Fairness Rocks news

    SOURCE: U.S. Copyright Office

    Date: May 2020

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  • Collective management of rights in a transforming market: A speech by Gadi Oron, Director General, CISAC, at the ALAI Copyright Congress

    I am delighted to be here today and I would like, first, to express my appreciation for all the people who made this conference possible. In particular, I would like to thank Mr Rudolf Leska, the president of the ALAI group here in the Czech Republic, and his team, who I know have been working tirelessly, for many months, to organise this ALAI event. I am very happy and proud that we, at CISAC, could partner with ALAI this year and be associated with this conference.

  • Fairness Rocks news

    SOURCE: CISAC

    Date: September 19, 2019

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  • PRESIDENT’S MESSAGE: Buyouts – Friend or Foe?

    One of the questions I’m most often asked, particularly by young or inexperienced members, is “why don’t composers have a union?” Virtually ever other craft in the film making process has a representative organization empowered to collectively bargain for wages and working conditions on their members’ behalf. The reality is that in days gone by, composers DID have a union – the Composers and Lyricists Guild of America (CLGA) – the forerunner to the SCL. For those who don’t know the story of the CLGA’s demise, I urge you to read our resident music historian, Jon Burlingame’s account of the chronology on the SCL’s website (http://thescl.com/about). While it can’t set minimums or conditions, I believe the SCL remains a media composer’s best resource to remain apprised of the prevailing state of the business, through its advocacy, education and exchange of pertinent information by its members.

  • Fairness Rocks news

    SOURCE: SCL

    Date: September 13, 2019

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  • WGA Challenger Craig Mazin: Union Needs to See the Agents’ Side on Packaging

    Vying to steer the Writers Guild of America, there’s a slate of high-profile dissident candidates. Among them is “Chernobyl” writer-creator Craig Mazin, who recognizes that his proposed strategy in the screenwriters’ battle against talent agencies — compromising on the controversial practice of packaging — isn’t exactly sexy.

    Read more: https://www.indiewire.com/2019/07/wga-dissident-craig-mazin-phyllis-nagy-agency-packaging-dispute-1202161842/

  • Fairness Rocks news

    SOURCE: IndieWire

    Date: July 30, 2019

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  • MMF Song Royalties Guide

    The MMF has spent the last few years exploring how money flows from streaming services through to artists via our ‘Dissecting The Digital Dollar’ series of reports and guides produced with CMU Insights. This has included reviewing the debate around how the ‘digital pie’ is sliced, ie the ongoing discussions over how streaming income is shared out between the different stakeholders, including artists, songwriters, labels, publishers and the streaming services themselves.

  • Fairness Rocks news

    SOURCE: MMF

    Date: May 9, 2019

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  • European Survey on the Renumeration of Audiovisual Authors

    Over the past decades, cultural and creative industries have gained recognition as important components of our society due to their role in the enrichment and development of culture (UNESCO, 2009). This importance of these industries are constituted by both economic and non-economic elements (impact on social cohesion, values, creative innovation, etc.). In recent years a lot of attention has gone on the economic elements, because of the acknowledged impact of cultural industries on e.g. GDP growth rates and employment, and the conviction that cultural industries can improve a country’s foreign trade position and competitiveness (UNESCO, 2009).

  • Fairness Rocks news

    SOURCE: FERA

    Date: April 8, 2019

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  • IFPI Global Music Report 2019

    The global recorded music market grew by 9.7% in 2018, the fourth consecutive year of growth. Figures released today in IFPI’s Global Music Report 2019 show total revenues for 2018 were US$19.1 billion.

     

  • Fairness Rocks news

    SOURCE: IFPI

    Date: April 2, 2019

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  • EUROPEAN SURVEY ON THE REMUNERATION OF AUDIOVISUAL AUTHORS

    The final results of a survey on European audiovisual authors’ remuneration demonstrate the urgent need for action to improve their situation. As the European Parliament is about to vote on the Directive for Copyright in the Digital Single Market which features essential provisions to improve authors’ remuneration, FERA, FSE and SAA urge MEPs to adopt it without amendment and further delay.

  • Fairness Rocks news

    SOURCE: FERA

    Date: March 25, 2019

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  • JOINT STATEMENT OF THE EUROPEAN FEDERATIONS REPRESENTING CULTURAL AND CREATIVE WORKERS

    Across the EU, the employment landscape has shifted significantly in recent years and the profile of the workforce has evolved in new directions. An increasing emphasis on flexibility and a move towards more intermittent, short-term, project-based ways of working across all sectors has resulted in a greater diversity of employment statuses. A growing percentage of the workforce can be described as independent /self-employed/ freelance/ casual workers – a whole range of terms that denote an increasingly common employment reality. This is certainly true of the cultural sector, where the nature of the work lends it particularly to this kind of employment regime. Thus, for actors, musicians, technicians, journalists, writers and others, this is the increasingly the reality they must work with. Short-term, contract-based work, on a freelance basis is the norm, however, the work itself (eg: acting or playing in live shows, films and TV programmes, or theatre/music companies; doing the technical work in such productions; or indeed producing news reports or articles) has hardly changed at all, though in the past it would have been done under an employee contract – in some cases, a permanent one.

  • Fairness Rocks news

    SOURCE: FIM

    Date: February 28, 2019

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  • PUTTING THE BAND BACK TOGETHER: Remastering the World of Music

    The music industry is in the midst of two profound changes. First, consumers are increasingly opting to rent — rather than buy — music. Second, the demise of physical music has prompted artists to tour more often, driving significant growth in concerts and festivals.

  • Fairness Rocks news

    SOURCE: Citi GPS

    Date: October 8, 2018

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  • Rights and Revenues for Music Performers

    Rights and Revenues for Music Performers

     

    Since its inception in 1948, The International Federation of Musicians (FIM) has been working towards the recognition of intellectual property rights for music performers. FIM’s efforts have led or contributed to the adoption, at international level, of the Rome Convention (1961), the WPPT (1996) and the Beijing Treaty (2012). However, these rights are not a guarantee of remuneration for performers as contractual practices – from the design of to the interpretation of contracts – may simply annihilate any benefit expected from the exploitation of their recordings.

     

    Online music: 1990-2017

    The democratisation of Internet and the rapid evolution of information technologies since the ’90s have enabled consumers to access a new music offer so vast that was unimaginable only a few years back. Beginning with downloading and then streaming; music became available almost without restrictions.

    While enthusiastically entering the digital era, Internet users also discovered the existence of copyright, a concept which even today is still difficult to grasp for many of them. This legal construction is a principle set out in Art. 27 of the Universal Declaration of Human Rights:

    Article 27 […] 2. Everyone has the right to the protection of the moral and material interests resulting from any scientific, literary or artistic production of which he is the author.”

    The principle was fine-tuned as technologies developed (LPs in the middle of the 20th century then the Internet at the turn of the millennium). An international instrument – the 1961 Rome Convention – was dedicated to giving performers and phonogram producers legal protection of a similar nature as that for authors. Labels and performers are entitled to be paid a royalty (known as “equitable remuneration” and managed by collective licences) when their recordings and recorded performances are broadcast or performed.

    Sixty-five years after the adoption of the Rome Convention, the choice to protect investors (such as record labels) with a copyright remains a frustrating one for performers. And, the United States is still not a signatory to the Rome Convention which is most disadvantageous to American performers.

    Outstripped by the pace of development, to begin with the phonographic (record) industry took a hyper defensive stance by promoting Technological Protection Measures (TPMs – inappropriately termed DRMs or digital rights management) and a few resounding law suits in piracy (against both commercial music pirates and, unhelpfully, individual music fans), before finding new economic models which today enable it to renew profits. These policies have meant, however, that the record labels have had to pay the heavy price of a seriously dented image.

    Leading music streaming services such as Spotify, Deezer, Pandora, Apple Music, YouTube, Tidal, Rhapsody, Qobuz, or Google Play try to win over a maximum number of customers, whether these pay or not, as quickly as possible. What differentiates the various services is not so much the catalogue made available (despite the sensational withdrawal of some artists) as other aspects such as interface or sound quality (Tidal now offers MQA- master qualiy authenticated). Subscription prices remain at psychological thresholds (€9.90 a month for Deezer or Spotify).

     

    But Something is Not Right…..

    The figures are clearly impressive and steadily growing. YouTube: approx. 1 billion users, Spotify: 140 million users (thereof 60+ million subscribers), Deezer: 16 million. Dissenting voices are, however, being raised among artists. Taylor Swift opposes the freemium models: “Valuable things should be paid for” she says. “It’s my opinion that music should not be free.” On the 21 June 2015, she successfully upset the streaming applecart when she came out against Apple Music’s new offer not to remunerate writers, composers and performers for the 3-month trial period after their initial launch.

    In reality, these illustrious voices, whom the media are quick to take up and who are followed directly on Twitter by millions of fans, are the trees which prevent us from seeing the wood. Clearly they justly denounce the shortcomings of streaming models and in particular the pitiful remuneration the talent receives in comparison to an often colossal number of times they are heard. The immense majority of performers, however, do not even receive this feeble income. Quite simply, they receive nothing. How is this possible?

    The economy of recorded music has for decades been based on a simple principle: performers do have intellectual property rights – they are known as “neighbouring rights” as they are akin to but not the same as copyright. These rights constitute a potential source of income, but it generally remains theoretical on account of the unfair conditions of transfer of such rights to the record label (known as the “producer”.)

    This imbalance in contractual relationships is explicitly recognized in a European Parliamentary report issued in July 2012 (the Cavada report):

    “48. Calls for the bargaining position of authors and performers vis-à-vis producers to be rebalanced by providing authors and performers with an unwaivable right to remuneration for all forms of exploitation of their works, including ongoing remuneration where they have transferred their exclusive ‘making available’ right to a producer.

    The Reda report published in July 2015 (https://juliareda.eu/copyright-evaluation-report/full/ ) goes along the same lines:

    “27. […] calls for improvements to the contractual position of authors and performers in relation to other right holders and intermediaries, notably by considering a reasonable period for the use of rights transferred by authors to third parties, after which those rights would lapse, as contractual exchanges may be marked by an imbalance of power.”

    Such imbalance between producer and artist often means that the latter is forced by contract to accept a single, lump-sum payment which remunerates both the recording of the performance and all subsequent possible and imaginable uses thereafter.

    There is, however, an exception to this global transfer, first established by the Rome Convention, which concerns broadcasting and communication to the public of commercial phonograms (diffusion of music in public places, dance halls, shops, hotels…). This type of use is not covered by an “exclusive” right but by an unwaivable “right to remuneration”. As such, no prior authorisation from right holders is necessary, but instead the payment of equitable remuneration is required. This payment by the user (a broadcaster, or night club for example) is shared between performers and producers and is in principle shared equally between these two categories of right holders.

    In practice, therefore, performers have generally only one right from which they receive remuneration –that of broadcasting and communication to the public–, because of its non-transferable nature. Since all other so-called “exclusive” rights have been transferred to the producer in the label contract, it is the label that receives income from these other uses – sale, download and interactive online streaming.

    There are signs that record companies may unilaterally decide to exploit pre-digital era recordings on the internet by ways of streaming or download, claiming that under the old contracts they own the performer’s exclusive right of “making available” even though such uses and the rights attached to them did not exist at the time the contract was signed.

    (There are other compensatory mechanisms for private copying, which come under an exception to exclusive reproduction right and allow users to make copies for private use in exchange for a levy of which performers receive a percentage – but these monies take the form of lump sum payments which carry their own challenges in terms of accurate allocations.)

     

    Downloading, streaming: exclusive right or right to remuneration?

    The case of downloading is clear: this is what is referred to in treaties as the “right of making available to the public on demand”. Making available is a recent legislative addition. It is a sub-set of the communication right and was created by an international treaty from the World Intellectual Property Office. The WIPO Performers and Phonograms Treaty 1996, or WPPT, accommodates a right from the internet delivery of performers and audio recordings of their work. The USA has not embraced the “making available right, notwithstanding its membership of WIPO, as US law applies other exclusive rights (operating either separately or together) from their domestic copyright statute, although in 2016 a study of the right was published by the US Copyright Office.

    Making available is defined in WPPT as an exclusive right:

    Performers shall enjoy the exclusive right of authorizing the making availableto the public of their performances fixed in phonograms, by wire or wireless means, in such a way that members of the public may access them from a place and at a time individually chosen by them.

    This type of use presupposes a triple choice: that of the recording the person wishes to listen to, the time when he/she has access to it and the place of access.

    Downloading by a music lover fulfils these conditions. But as the music is retained, akin to acquiring the music by a sale, the labels consequently only remunerate artists for a possible contractual sales royalty, if provisions are made for such in the contract.

    Streaming is slightly different. Users can either access a particular recording which they have selected, or listen to a curated or random playlist whose tracks are unknown beforehand, as is the order in which they are played.

    In the first case, this is making available on demand, whose three WPPT criteria are fulfilled, as with downloading. In the second case, however, this is a simple communication to the public for which payment should be made on the basis of equitable remuneration – as in a broadcast where the audience simply receives what is being chosen for them.

    But in this second case, despite their right unwaivable right of equitable remuneration, it is not, certain that artists will be paid. Some jurists claim that by just pressing a single key while listening (skip or pause for example), users introduce some level of interactivity which is sufficient to redefine this act as an exclusive right (passed to the label by contract), thereby eliminating equitable remuneration in favour of an exclusive right of making available on demand. This right is transferred contractually to producers and consequently, more often than not, only benefits the latter.

    For an artist with a record contract – a so-called “featured” or “contracted” artist – the label will apply the contractual sales royalty, either as a percentage of the actual price or a percentage of “wholesale” thereby reducing the royalty calculation base. Often a label will deduct packaging costs despite these not being incurred in online dissemination at all. One consequence for artists on old contracts with very low royalty rates is that as much as 90% or more of making available revenue will be retained by the label – even where any monies the artist was advanced has long ago been recouped from their record sales.

    For a session musician the situation is even more desperate. Their fees for recordings are part of the recording budget, and all their rights as performers (save for the unwaivable right of equitable remuneration) are acquired globally for a single fee. The result is that, of the revenue from the making available of recordings, nothing is paid to the session musicians – despite their important musical contributions to the recorded works.

     

    How to Remunerate Performers?

    As we have seen artists who do receive royalties are daily expressing their frustration over the pitiful amounts of money they receive

    When contracted or featured artists are both the performers and the authors of the songs they perform (a singer/songwriter), the average payment per stream they receive as indicated in April 2015 by the website http://www.informationisbeautiful.net/ is:

    YouTube: $ 0.0003

    Deezer: $ 0.001

    Spotify: $ 0.0011

    Apple Music : $ 0.0013

    GooglePlay: $ 0.0073

     

    As for the other artists –the majority– they receive nothing except for the lump sum payment at the moment of recording.

    It is clearly understandable that this situation is untenable and artists cannot be left by the wayside any longer as a result of economic models which deliberately ignore them. In order to try and put an end to this injustice, four organisations representing performers in Europe: AEPO-ARTIS (http://www.aepo-artis.org ), the International Federation of Actors (FIA), the International Federation of Musicians (FIM) and the International Artists’ Organisation (IAO) are carrying out a campaign to introduce into European legislation a right to remuneration for performers, collected from downloading and streaming platforms and managed by performers’ collective management organisations. Links to these organisations are found elsewhere on Fairness Rocks.

    This right to remuneration does not replace the exclusive right of making available but is an addition to it, thereby enabling all artists whose performances are exploited online to receive a fair share of the income generated.

    Promoted by the FAIR INTERNET campaign (http://www.fair-internet.eu ), this model is not new at European Union level as it already exists for the rental right (Directive 2006/115/EC, Article 5). Also, performers’ collecting societies already have a longstanding experience in this type of exercise. Consequently, the system proposed does not present any legal or technical problems.

    With the proposed European Directive reviewing copyright in the Digital Single Market, European performers have a once in a lifetime opportunity to be granted a fair share of the online income they help generate. This necessary advance is the key to the new equation that both artists and those who listen to them are waiting for, in Europe and on a global scale.

    The International Federation of Musicians (FIM) https://www.fim-musicians.org/

  • Fairness Rocks news

    SOURCE: FIM

    Date: October 2, 2018

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  • MID-YEAR 2018 RIAA MUSIC REVENUES REPORT

    Music continues its comeback story, powered by great new music, talented artists and a re-invented record industry. A business growing again, driven by a competitive paid streaming market, means new investments in more artists and more music. That is fundamentally what we’re all about.

     

  • Fairness Rocks news

    SOURCE: RIAA

    Date: September 26, 2018

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  • Key Vote for the Talent tomorrow at EU Parliament

    Tomorrow the European Parliament votes on new copyright law which has the potential to transform the livelihood of the talent.

     

    Every writer and performer should be looking eastward tomorrow (September 12th) for the EU Parliamentary vote on a new copyright law for the digital marketplace. Parts of the text have the power to be game changers for anyone whose creative work is exploited in the EU.

     

    Article 13 is an adjustment to what’s called “safe harbour protection”; these changes, mainly addressed to powerful sites such as YouTube will require them to pay fair license fees to the creative industries, for a change!   The Article won’t affect freedom of expression, memes, or upload services such as WordPress or Dropbox—only the platforms that have amassed vast fortunes distributing content to the public without paying for the work. The tech sector’s response at the time of the first vote in July was, unsurprisingly, that of digital hysteria. Volker Rieck, MD of content protection service, File Defense Service, gives a good account here.

     

    Any creator would welcome the prospoect of proper licence fees being paid when their work is used online. But for the talent, for authors and performers there is more, much more. Thanks to the tireless work of talent advocacy groups in the EU, on behalf of writers, directors, actors, musicians, and songwriters, the Directive’s text has the potential to revolutionize all our dealings with film producers, record labels, and publishers.

     

    The EU Legal Affairs Committe was enclouraged to adopt the radical (?) principle of equitable and appropriate remuneration for creators. The response is a text designed to ensure that “authors and performers receive fair and proportionate remuneration for the exploitation of their works”. And this includes online distribution.

     

    Here’s how they propose to do it. Chapter 3 of the draft Directive (Articles 14 to 16a) has been labelled by talent advocacy groups as the Transparency Triangle – but more lucidly might be described as giving authors and performers, when their work is assigned or licensed, the rights to, track transfers, revisit their reward, reclaim rights and determine disputes.

     

    Article 14 will give writers and performers of all stripes the right (at least once a year) to be given by those to whom they have directly licensed, assigned or transferred rights in their work “adequate, accurate and sufficient information on the exploitation and promotion of their works and performances from those to whom” including details of “modes of exploitation, promotional activities….revenues generated and remuneration due”. That would be refreshing.

     

    The talent is always the last mouth to feed in the royalty food chain.

     

    While digital music revenues look minuscule when they arrive on royalty statements, the fault should not necessarily always be laid at the door of Spotify, say, or Apple. The licence fees these services pay to the publishers and labels are not to be sneezed at. It is what happens to the money once it gets to the pocket of the corporation….

     

    The music business deals signed by writers and performers with publishers and labels almost all say that the companies do not have to share income with the songwriters/artists unless money can be “directly and identifiably” attributed to individual songs or tracks.   This contract term acts as an inbuilt disincentive for these companies to maintain accurate copyright data, because any money the label or publisher cannot attribute they can keep! A good reason for us all to want to see what went into the front end of the income sausage.

     

    Screenwriters and directors are both classed as film authors but unlike songwriters and musicians they have to sign away all their rights upfront for a single fee and have no right to be accounted to by the film studios or producers.

     

    As the Spinal Tap creators show in the Shocking Facts section of their site www.fairnessrocks.com Europe’s audio visual market was valued in 2013 at €122 billion. If one calculates the share of exploitation revenue from the entire EU audio visual market that goes to directors and screen writers it is less than half of one percent: 0.37% (source: SAA). In the USA, filmed entertainment was valued in 2017 at US$226.9 billion (source selectausa.gov) from box office, home video and tv subscriptions. If one calculates the share of this revenue that is paid to screenwriters and directors via their residuals (collected and paid out by the talent guilds – WGA and DGA) it is estimated that these two talent groups share approximately one half of one percent: 0.58%.  One can’t argue that a little fiscal leg up might be useful.

     

    If Article 14 of Europe’s new law is passed on Wednesday Europe’s film and music talent will be in a much better position to see the sausage in its entirety – though the inclusion of the word “directly” in referring to the talent’s licensing partners may make access right across the world a challenge (or moot?).

     

    Article 15 of the new law imports a legal principle known as the Best Seller Rule. Its aim is to give the talent a legal right to revisit the commercial terms of a contract with a distributor and renegotiate to better reflect actual income. It will be ground-breaking if this Article becomes law in Europe. The principle recognises that contracts are usually signed before the creator has any idea of what their work is worth. Those Fairness Rocks readers following the efforts of Chris, Rob, Michael and Harry to challenge Vivendi over their concealment of their entitlements from the film This is Spinal Tap, will understand why such a law would be a very good idea indeed.

     

    Article 16 would oblige EU Member States to create affordable dispute resolution to ensure the effectiveness of the transparency and contract adjustment mechanisms. The four plaintiffs can speak with some authority and wistfulness about the attractions of affordable dispute resolution. For younger or less successful creators such a forum would be a breakthrough in access to justice and redress.

     

    Finally, Article 16 (a) would give the talent a right of revocation – to regain control of works that are not being actively exploited. The USA has had a termination right on the statute book since 1976, and it has just recently “kicked in”. Across the USA, the talent is either reclaiming rights or renegotiating deal terms. It would be great to help our “older cousins” in Europe to be able to do the same.

     

    As one can imagine the corporations are all in favor of the Article 13 licensing opportunity but not so keen on the Chapter 3 rights (14, 15 , 16 and16a) that have the power to change the lives of the very people on whom the creative industries depend.

     

    Keep any eye out for news what the EU Parliament decides tomorrow.

     

    And sign up to www.fairnessrocks.com for regular news updates about your rights and the industry you have built.

    FR

     

  • Fairness Rocks news

    SOURCE: Fairness Rocks

    Date: September 11, 2018

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  • Magic Numbers

    Geoff Taylor, chief executive of the BPI, and Kim Bayley, chief executive of ERA, on why big-data and analytics matter for labels, artists and digital service providers alike

  • Fairness Rocks news

    SOURCE: BPI & ERA

    Date: July, 2018

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  • AV Remuneration Study

    INTERNATIONAL LEGAL STUDY ON IMPLEMENTING AN UNWAIVABLE RIGHT OF AUDIOVISUAL AUTHORS TO OBTAIN EQUITABLE REMUNERATION FOR THE EXPLOITATION OF THEIR WORKS Study updated – May 2018

    Submitted by Prof. Raquel Xalabarder
    Intellectual Property Chair – Universitat Oberta de Catalunya (UOC), Barcelona.

     

    EXECUTIVE SUMMARY

    authors of audiovisual works are granted exclusive rights to exploit their works. however, they rarely obtain equitable remuneration for the entire exploitation.

    despite international consensus that authors deserve to be fairly remunerated for the exploitation of their works, audiovisual authors seldom receive remuneration in the form of royalties or other proportional payments along the entire chain of exploitation. this is especially true in regards to new markets for online exploitation that, despite growing rapidly, do not generate additional remuneration for audiovisual authors.

    audiovisual authors’ remuneration depends largely on the contracts signed with the producer and these contracts fail to secure them an equitable remuneration for the entire chain of exploitation of their works.

    Signed before the audiovisual work is created, production contracts tend to convey a full transfer of exploitation rights in favour of producers, typically in exchange for a buy-out or lump-sum that also covers commissioning the authors’ contribution. follow up payments, along the exploitation of the work, are rarely agreed upon in production contracts. this ultimately deprives audiovisual authors of equitable remuneration in all markets of exploitation of their works…

     

     

     

    Continue reading this short guide: 4-pages-av-remuneration-study

     

    Alternatively by downloading the pdf below.

  • Fairness Rocks news

    SOURCE: CISAC

    Date: May, 2018

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  • HOW SONGWRITERS AND COMPOSERS ARE CONTRACTED AND PAID

    The function of a music publisher on behalf of a songwriter or composer is threefold: To fund the production of original works; to promote the works by seeking exploitation opportunities; and to manage the licensing of rights and the resulting income, paying the money to the author according to contract.

     

    Different cultures prevail as between a record label and a publisher. A song can have a much longer life than a single track, so the impulse in the label is to maximise earnings from the moment of release, knowing there is not likely to be a long exploitation life ahead. In contrast, for music publishers, because of the combined revenue opportunities of film and tv usage, advertisements and cover recordings by a range of artists, it is the longevity of a song that drives the business – though a huge hit by a new artists will bring out the chequebooks from the off because of the value of royalties generated by the song’s communication to the public (such as broadcasts).

     

    There are independent music publishers who do an excellent job nurturing their catalogues. But in a marketplace where three major companies dominate – Sony/ATV, Universal Music Publishing and Warner Music – it is difficult to see how effective promotion can be for the “majors” when they own hundreds of thousands of songs which are being “promoted” by internal promotional teams. It is quite a task to secure song placements in film, tv, games, ads, and cover versions by other artists for every song in the majors’ catalogues.

     

    There is a key principle embodied in the structure of rights and revenues from music publishing. While a label pays a royalty only after recoupment of an advance, acquires complete control of the sound recording copyright, controls a performer’s services but CMO income is not guaranteed, it is different for songwriters and publishers.

     

    Firstly NOT ALL the rights in the songs are granted to the music publisher. The communication to the public right (which includes the making available right) is granted by the songwriter to the songwriter’s local CMO. The music publisher acquires all the other strands on the copyright bundle but not the communication to the public right. (Check out the section on Collective Management Organisations.) The publisher has only a right by contract to share in the revenue that this right generates, but not ownership of the right itself.

     

    In every country but the USA the songwriter’s assignment to their local CMO is global and exclusive. The effect of this (everywhere but in the USA) is that the CMO issues the licences, shares data with other countries’ CMOs and collects domestic income from domestic licensees and foreign income from foreign CMOs. Nobody but the CMO can issue a licence or collect income. In the USA a songwriter’s assignment is non-exclusive which enables the publisher, subject to the express terms of the individual songwriter’s contract, to issue license direct to users. This does not always work to the benefit of the writers……

     

    The second difference between a performer’s situation with a label and a songwriter’s with a publisher is the revenue flow and the sources. A performer will receive some income – after their advance – from a CMO (see How Performers are Protected and Paid in the Library) but only in countries where the law makes this possible. But a songwriter will always receive a minimum of 50% from CMO in nearly every country in the world, and from the moment their songs start to be exploited. This revenue comes direct from the CMO and cannot be used by the publisher for recoupment of any advance. The other 50% is paid by the CMOs to the publisher and it is that half plus other income the publisher collects from the rights they DO own, that recoups any advance paid to the writer. It is because of this contractual right to income that publishers have Board representation at CMOs. The writers who share the Boards of the CMOs often have to fight hard to keep the writers’ interest to the fore in policy and distribution decisions. Be surprised.

     

    Publishers customarily pay an advance and may contract for a series of option periods during which a songwriter delivers a pre-agreed number of works. This is the model if the songwriter is either a performer as well (thereby guaranteeing song income from live performances or from the copying of the song on recordings), or has a reputation as prolific, or the publisher has sufficient confidence in their abilities. A writer will continue to have an exclusive relationship with the publisher for as long as the options are exercised and after an agreed period of time is free to take their song writing skills elsewhere. But the copyrights that the songwriter has created and has assigned to the publisher (as ownership of most but not all of the bundle of rights) might stay with the publisher for the full period of copyright – life of the author plus a number of subsequent years (plus 50 to 70 depending upon the country’s statutes). Writers with strong negotiating status can agree that the rights will revert to them after a pre-agreed time. And writers that are very powerful can do deals whereby they engage only the publishers’ services of promotion, funding and administration, but do not pass ownership of the copyrights across.

     

    It is the publisher’s responsibility to manage the licensing of the works for usage not just by an original singer/songwriter, but to find cover versions by other artists or use of the songs in ads, films and the like. Revenue from the copyrights assigned to the music publisher will be generated every time one of the so-called acts restricted by copyright takes place: copying (onto a CD, DVD, into a film or ad, copying and printing sheet music or from income from arrangements/adaptations, and the publisher’s 50% from CMOs.

     

    The share of revenue between a publisher and a writer is very different from the customary level of royalties from performers. The royalty split will be anything from 50/50 to 80/20, and can be 90/10 for the very successful. So, remember that 50% that a publisher gets from the CMOs? Well, after recoupment of any advance, the publisher may have to share a portion of that with a songwriter to conform to the royalty split agreed by contract. Old contracts still prevail where it is a strict 50/50 split. But more modern contracts will oblige the publisher to give say 75% of income from their revenues to the songwriter – so most of income from copying CDs and DVDs for example is paid to the writer.

     

    And where that 75/25 split applies to the income from communication to the public – live performance, radio, tv and streaming – the publisher will, after recouping the advance, have to use some of “their” 50% to top up the 50% the writer has already received. So, in the case of 75/25, the publisher will have pay onward half of their 50% (ie 25% of the gross) to bring the writer’s share up to the agreed 75% in the contract.

     

    From this one can see that in a band, it is the person who writes the songs that will be earning between 8 and 11 times as much as the band members signed only to the record label as performers. One very good way to keep a band cohesive is to agree – up front – to share song writing income, or credits and income, equally among all members of the band. That will leave “musical differences” to be the basis for disputes.

     

    A publishing contract has approvals provisions, so writers may be able to influence how their music is used in commercials for example. The contract will identify the length of the option periods, how often the publisher accounts, the rights of audit (because auditing is essential to make sure accounting is correct),and how long the publisher will own the copyrights after the actual contract is finished.

     

    One last word about streaming. Digital services have to acquire music licences from both labels and publishers – for the recording and the song. For the songs the services have to acquire the right to communicate to the public from the CMOs and the right to copy the songs from the publishers.

     

    The act of downloading a song uses the copying element of the copyright as well as a communication to the public. The money from downloading is weighted to allocate more to the copying element than the communication. This has helped publishers recoup advances that used to be recouped from revenues created by copying CDs – a market that has dived since the digital revolution.

     

    But for streaming one might expect that communication would take the lion’s share of every dollar, and the transient copy be a minor part of the allocation. In some cases this is indeed true. But increasingly, powerful publishers, have pressed CMOs to agree that the weighting should be 50/50, for communication/copy. One can see that the challenge of recoupment from diminishing copying revenues might prompt this commercially, but those contractual “three little words” (see Shocking Facts) tip the scales in favour of publishers. Remember, unless a publisher can match the money “directly and identifiably” to the individual songs, no payment will be made to the writers. Added to that the internal song identifiers used by publishers being different from those used by CMOs, and there remains an inbuilt disincentive for publishers to maintain accurate data internally. Or data and identifiers that match those held by the CMOs. Lump sums monies that cannot be exactly matched to individual songs in the catalogue can be retained, which is good news for publisher executives’ bonuses and shareholders.

  • Fairness Rocks news

    SOURCE: Fairness Rocks

    Date: April 24, 2018

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  • HOW RECORDING ARTISTS ARE CONTRACTED AND PAID

    A traditional contract between a band or solo artist and a record label is an interacting mesh of rights and obligations borne by both parties. No prizes for guessing which party carries the most obligations and which leads the field in having rights. That said, each party agrees to honour their respective roles in the deal.


    ARTISTS’ OBLIGATIONS
    To record and deliver a recording
    To promote the recording
    To pay for the costs (via a recoupable advance) including studio costs, instrument costs, the producer, the session musicians and singers.
    To make one or more videos
    To work to the best of their abilities
    To deliver subsequent recordings upon receipt of option exercise by label
    To share with the label income from merchandise, publishing, sponsorship and tour profits (if a 360 deal)
    ARTISTS’ RIGHTS
    To receive royalty accounting but only where the money is directly and identifiably attributable to their work.
    To audit the label (upon notice)
    To be consulted over (possibly approve) artistic choices such as producer choice, song choice, use of the tracks in ads or films
    To collect neighbouring rights income in territories where entitlement exists

    LABELS’ OBLIGATIONS
    To pay the advance specified by contract
    To reproduce, manufacture, (promote) and distribute the recordings
    To collect royalties, account and pay royalties to the artist but only where the money is able to be matched directly and identifiably with the artist’s work.
    To pay the mechanical licence fee for copying the songs on the recordings
    LABELS’ RIGHTS
    To control the exclusive recordings services of the artist & to exercise options and call for further recordings
    To require delivery of the recordings
    To own the copyright in the recording (in perpetuity)
    To determine the marketing strategy
    To conclude licence agreements with subsidiaries on customary company terms and receive foreign income
    To conclude licence agreements with third parties on terms in their absolute discretion and collect revenues
    To collect the 50% share of neighbouring rights income
    To be paid a share of income from merchandise, publishing, sponsorship and tour profits (if a 360 deal)

    A performer is supplying services not delivering a copyright. If however, they have independently paid all the costs of production themselves and therefore own the recording’s copyright, they can grant a short term licence to a label in exchange for the label’s manufacture, distribution and promotion services.

     

    The label’s function is to fund, manufacture, distribute, promote and protect the copyright sound recording that results from the artist delivering their services as a recording artist. Unless the contract specifically says otherwise the label will own the copyright in the recording, usually for the life of copyright (ie in many countries this is 70 years from publication). In industry folklore this is the metaphorical equivalent of the bank giving you a mortgage to buy a house, but when you pay off the mortgage the bank keeps the deeds and ownership of your house.

     

    ADVANCES

    The funding aspect has two elements. It is made up of a non-returnable advance payment and second recoupable element which is the cost of making the recording (ie studio costs, the fee for session musicians, the fee for the producer and engineer, instrument and equipment hire etc). The artist must recoup these two cost elements from income generated by exploitation. The key point to remember is that the income used for recoupment is the artist’s royalty percentage not gross revenue from the exploitation of the recording. So if the artist is on a 15% royalty then that 15% (after adjustments – see below) is the source of recoupment monies.

     

    ROYALTIES

    The royalty percentage is calculated by a “base price” which will be defined in the contract. It might be the wholesale price, or less commonly the retail price; but both prices will be subject to deductions before the final “base price” is arrived at. Common deductions are taxes, costs of physical packaging including the costs of the artwork – and these deductions will be percentages varying from 15% to 30% in some cases. As a result an artist might end up with a base price that has been chiselled by as much as 35% or 40% from the original wholesale price, once the total deductions have been made.

     

    Each use of the recordings will carry a specified royalty. So, for example while a sales royalty may mean a 17% royalty (after deductions) the royalty will halve if a track is included on a compilation album. If a track is used in a film or TV programme, or in an advertisement, it is usual for 50% to be paid to the artist (subject always to recoupment progress).

     

    The studio producer (most famous exemplars of this key production role being Quincy Jones, Jeff Lynne, Dr Dre, the late, great Sir George Martin, the currently incarcerated Phil Spector and Mutt Lange) is paid a fee (which is a recording cost) and a royalty percentage. So, if an artist’s royalty is stated as 25% and the producer royalty is 3%, this leaves the artists with 22% from which to recoup the advances (personal and recording). Some producers will negotiate their royalty from the very first record shifted (known in the trade as “record one”). The effect of this is that the artist’s recoupment account goes further and further into the red via the payment to the producer from the moment the record goes on sale.

     

    OPTIONS

    When a label is signing an artist to a multi-album deal, the contract will be framed as a series of options. Each option is for a defined period of time in which the artist is obliged to record, deliver and promote an album. A multi-album contract might contain three or four option periods. An option period is something of a moveable feast. It might be defined as a specific period of time in the contract but will be extended where an artist delivers the album late, for example. Once the first option period has passed, the label gives the artist formal notice and exercises its option to call for a second (or the third or fourth) album if it wants to continue the relationship. The exercise of an option will trigger a second (or third or fourth) advance for the artists and to pay for recordings.

     

    There is an absolutely genius mechanism (genius, from the label’s perspective, that is) behind this option/advance principle. Because it can take up to three years for foreign revenues to make their slothful way back to the country where the deal was originally made, an artist’s recoupment account may be unrecouped as far as actual money received by the label is concerned. But so-called “pipeline income” may be of sufficient value that it causes recoupment and is about to be paid to the artist as a cash royalty. However, once the option is exercised and the second (or third or fourth) advance is paid, no cash royalties are then due because the artist’s recoupment account has gone back into the red – ie unrecouped. In effect the label lends the artist their own pipeline income as an advance and then requires the artists to recoup it from sales from the next album. See what we mean? Genius!

     

    After fulfilling all the delivery requirements (known as the “minimum commitment”) in each period the artist is free to leave for another label, or re-sign with the same label. Notwithstanding the end of the deal, and the end of the recording relationship, the copyright in all the recordings remains the property of the label in perpetuity. (This perpetual ownership may be subject to any statutory termination rights – in the USA, for example – or contractual termination that might be triggered by, say, a label’s bankruptcy.)

     

    The contract might require an artist to make a video – and carry 50% (usually) of the costs of its production. This cost is added to the recoupment account along with any other monies the artist might request such as so-called “tour support” to help fund a live tour, or “loans” for other purposes that the artist might request.

     

    APPROVALS

    An artist may have certain conditional rights over the use of their recordings in film or tv, or in advertising for products or services, or over the choice of their producer. The strength of this control (ie the amount of genuine control the artist has) can vary from mere consultation to actual prior approval and will depend on their status, or negotiating power.

     

    ONLINE

    With the arrival of online delivery, and the accompanying plummet in income from sales of physical copies, many labels introduced what were called “360 deals” which meant that the label (ie the record company with a recording contract – the clue as to their role being in the name!) acquired a contractual entitlement to revenue from all an artists’ activities – live shows, merchandise and sponsorship and maybe even song publishing. The labels also exchanged shares in some online music delivery services, which will mean quite a windfall for the labels (only) in the case of a services’ IPO or other flotation such as that recently launched by Spotify. See also What Digital Did.

     

    NEIGHBOURING RIGHTS

    International law recognised performers’ (and labels’) ongoing interest in the use of the recordings aside from the sales of physical copies. While songwriters had long received royalties when their songs are broadcast or publicly performed, traditionally there was no equivalent for performers (or the copyright sound recording). So, in the period before WWII the International Labour Organisation lobbied hard for an ongoing right for performers that mirrored the royalty entitlement position of songwriters and composers. On reconvening after the interruption of war (during which time there had been the invention of magnetic tape) the performers were joined around the table by the broadcasters and record labels (via IFPI). The resulting international treaty (Rome Convention) was signed in 1961 and provided for a payment called “equitable remuneration” that was to be paid anytime that a commercial sound recording was broadcast or publicly performed (now called “communicated to the public”). The Convention allowed the payment to be paid to the label or the performer or both. The right upon which this revenue entitlement sits is known as a “neighbouring right”. The money is customarily allocated 50/50 – though in a few countries the performers get a larger share.

     

    Not all signatory countries implemented the Convention domestically in terms that gave performers a statutory right. Until a 1996 EU Directive the UK only gave performers an ex gratia payment. In contrast Continental European countries largely gave all performers a statutory right to the money. As the USA has not signed the Rome Convention US performers do not have a right to be paid this kind of revenue at all (except where their performances are delivered by non-interactive online radio – paid via Sound Exchange).

     

    One point to note: in most Rome Convention countries, the labels and the performers operate two joined CMOs together to negotiate and collect fees from the users of the music. However, when the UK implemented the EU law that obliged the UK government to give performers the right by statute, the performers were only given the right to claim this money from the labels! At a stroke of the legislators’ pens, the UK performer was reduced to supplicant (again) and had to apply via a CMO which is wholly owned by labels. So, while there are performer board members on the CMO (called PPL, Phonographic performance Ltd) the 50/50 allocation is calculated and paid under the direction of the powerful corporate right owners.

     

    And, as mentioned in Shocking Facts, the 50/50 allocation of neighbouring right revenues (equitable remuneration) is not applied to streaming revenues. The right of “making available” is legally a sub-set of the communication to the public right (which attracts equitable remuneration). But the labels in their wisdom did not mandate the UK CMO to collect streaming fees. The labels license their catalogues to the streaming services but treat the licence income as a sale when it comes to paying the talent. A recording artist’s contract may identify a sales royalty of 15% or much, much less for heritage artists. This sales percentage will be applied to, for example, Spotify revenues and in some instances, after the label has deducted costs such as packaging – in line with the definition of the royalty base price! Put bluntly, rights out from a label are for a licence, money out from a label is for a sale. So, in a blinding double standard, while 50% of the money is shared with UK performers from insignificant streaming services because they are licensed by the CMO, all the big streaming companies pay the labels direct and the labels give a much smaller slice to the talent. The deals are all subject to tight non-disclosure agreements, so an artist manager has very little ability to determine the terms on which their client’s rights have been granted and for how much.

     

    Another example of how this system works in practice is the unequal treatment of performers and labels from the USA. As the USA is not a signatory to the Rome Convention there is no legal entitlement to money. So, in fairness, neither US labels nor performers should have access to foreign neighbouring rights income as the USA offers no such reciprocity. But the US labels have offices and subsidiaries in the UK and in other countries that signed the Rome Convention. The effect in the UK, for example, is that the US labels collect their money for US recordings from the UK but not a penny, cent or peso is shared with US artists – the cash goes straight to the US labels’ bottom line, the shareholders and executive bonuses. [1]

     

    AUDITING

    An artist is accounted to and paid (if they are recouped) half yearly, sometimes quarterly, but between 60 and 90 days after the end of the accounting period. So if there is by contract half yearly accounting (June and December) plus 90 days, accounting will be issued on or around 31st March and 30th September each year. It is highly recommended that an artist audits their label. This is not just to determine that payments are correct, but it also sends a powerful signal to the company that the artist is awake and taking care of their business affairs. In a combined submission about music licensing made to the US Copyright Office in 2014, from the UK’s Music Managers Forum and the Featured Artists Coalition [2], there is an extensive and enlightening quote from an experienced music industry auditor:

    “I experienced an occasion where a label has asserted that they are not aware of the receipt of lump sum monies from licensees and has insisted that I, as auditor, identify a particular example of such a lump sum before they can comment. However, I am not able to obtain this information as the licensees have signed NDAs. In the case of other types of lump sums received by labels, such as settlements with copyrights infringers or audio and video public performance income, I am sometimes told that it is not possible to share this income with artists as there is no way of breaking the income down by recording. But the systems are NOT incapable of allocating the money. The [CMOs] and other rights organisations can allocate blanket licence fee money to individual songwriters. Data is always available which can be used to make a reasonable allocation.

    On the occasions that this income is shared with the artists, I have no ability to verify the allocation as there is no audit trail leading back to the income received from the source. I am told that this financial detail is not available to me as the source amount relates to all artists on the label and I am not entitled to that information as I am auditing at the request of an individual or single band. The company may in some cases describe a mechanism for allocation but I am not permitted to see the various stages of the calculation going back to the source of the funds. Also, where a payment is received in, say, the USA, for a global or a UK/USA deal, often the UK office is simply sent an amount, being the internal UK allocation. They themselves are not being given any detail of the original value of the licence.”

     

    THE INDUSTRY

    The most recent IFPI report on the music industry can be found here in the Library as well as an essay about music artists who control their recordings and publishing and use aggregators to get their product distributed – both digitally and in some cases, physically. Also the Library contains an article about song writing contracts, the latest figures from CMO regulatory body CISAC which show the health of music authors’ collections worldwide and a host of other industry-related articles.

     

    [1] For more useful information about US practices in music rights licensing try Steve Gordon’s book The Future of the Music Business (4th Ed., published by Hal Leonard). For practices in play elsewhere there are many books on the market.

    [2] https://www.copyright.gov/

  • Fairness Rocks news

    SOURCE: Fairness Rocks

    Date: April 6, 2018

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  • Fair Digital Deals Declaration


    “The big print giveth and the small print taketh away. ”

    – Tom Waits

     

    LABELS’ FAIR DIGITAL DEALS DECLARATION

    We make the following declaration in connection with the distribution of recordings in digital services.

    We will:

    1. Ensure that artists’ share of download and streaming revenues is clearly explained in recording agreements and royalty statements in reasonable summary form.
    2. Account to artists a good-faith pro-rata share of any revenues and other compensation from digital services that stem from the monetization of recordings but are not attributed to specific recordings or performances.
    3. Encourage better standards of information from digital services on the usage and monetisation of music.
    4. Support artists who choose to oppose, including publicly, unauthorized uses of their music.
    5. Support the collective position of the global independent record company sector as outlined in the Global Independent Standard below.

    We wholly disapprove of certain practices which leave artists under-recompensed and under-informed in the digital marketplace and will work together with the artist community to counter these practices.

    Signed on behalf of [Label]

     

    [Print name]

    [Date]

  • Fairness Rocks news

    SOURCE: Worldwide Independent Network

    Date: March 14, 2018

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  • ECONOMIC ANALYSIS OF SAFE HARBOR PROVISIONS

    Introduction

      1. A new class of website has arisen during this century that is based on users uploading materials (copyrighted and not) that other users can consume. These sites are described in several different ways, but I shall refer to them as user uploaded content (UUC) sites. The largest such site, YouTube, has well over a billion users and is the largest music streaming site in the world, as well as streaming other types of content.

     

      1. In the 1990s, prior to the emergence of UUCs, legislators were setting up rules for businesses on the Internet and were asked to help nascent Internet Service Providers (ISPs) by weakening traditional copyright laws with respect to copyright materials that might be uploaded to ISPs. Legislation was created that included provisions to help ISPs avoid being blamed for copyright infringement undertaken by their users, and a key component in doing so was the “safe harbor” which, as the name implies, allowed ISPs to avoid copyright liability as long as the ISPs followed certain rules, the most important of which is known by the term “notice and takedown,” essentially requiring them to remove infringing works quickly after being notified of such infringement.

     

      1. The safe harbor has become a contentious issue as music copyright owners feel that the safe harbor has allowed rich and powerful UUCs to arise while paying either nothing or what appear to be unusually small amounts to copyright owners, even though a large portion of the UUC users consume copyrighted music. UUCs argue that this is not the case at all.

     

    1. In the following report, I examine the intended purpose of the safe harbor, the nature of the UUC market that has arisen under the auspices of the safe harbor, and the economic consequences of the safe harbor.
  • Fairness Rocks news

    SOURCE: CISAC

    Date: February 27, 2018

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  • Nielsen 2017 year end music report us

    INTRODUCTION

    Welcome to the Nielsen Music Year-End Report, which examines the trends shaping the music industry with de nitive consumption gures and charts.

    The surge in streaming continued throughout 2017, topping all forms of music consumption. The industry had another record-breaking year, with 12.5% growth in music consumption year over year.

    For the rst time ever, R&B/Hip-Hop became the most dominant genre in the U.S., with nine of the Top 10 most-consumed songs coming from that genre, including breakthrough hits by new artists Migos, Post Malone and Cardi B.

     

  • Fairness Rocks news

    SOURCE: Nielsen

    Date: January 11, 2018

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  • SAA 2nd Edition White paper on AV Authors Remuneration

    INTRODUCTION

    The audiovisual industry makes a vital contribution to Europe both economically and culturally. There are approximately one million people directly working in the European audiovisual industry, an industry with ¤122 billion in revenues in 2013. 1,551 feature films were produced in 2013, box office receipts were ¤6.28 billion and a staggering 8,828 television channels and more than 3,000 on-demand platforms were offering access to audiovisual programmes1.

    Since the 1st edition of this white paper in 2011, box office receipts have grown despite a difficult economic climate. There are over 1,000 new television channels and the number of on-demand platforms has grown by over 400%.

  • Fairness Rocks news

    SOURCE: SAA

    Date: January 11, 2018

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  • Harry Shearer’s Keynote Speech at the W&DW conference in Venice on November 2017

    Keynote: Harry Shearer                                              

    Thanks very much.   I’m honored to have been asked to speak you today.   As a humble laborer in the twisted vineyards of comedy, there’s nothing really new I can tell you.   So, I invite you to enjoy a few minutes not so much of enlightenment, but more of a slightly dyspeptic pep talk.

    The concept of artists getting together has a checkered history at best. After all, we never had medieval guilds.   We had patrons.

    It wasn’t until Mary Pickford, Douglas Fairbanks Jr and two other superstars of the silent screen decided they’d had enough of the behavior of the first generation of film moguls and formed their own company, United Artists, that the concept got its first road test. The road was rocky. Most actors and writers, it turns out, make terrible businessmen; almost as bad as businessmen make actors and writers.   The company was ultimately swallowed up by a traditional studio, restoring the traditional position of creatives as petitioners for the favors of the mighty. The patrons were back in power.

    The past couple of months’ worth of news stories have drawn back the curtain on the behavior of certain members of the patrons’ ranks, leading to the rapid and inglorious defenestration of several of them.   Harvey Weinstein led the parade, with a few dozen actresses complaining of his sexual misdeeds.   Racing ahead in the victim derby has been producer director James Toback, with more than three hundred notches on his malodorous pistol. Kevin Spacey. Bret Ratner. Dustin freaking Hoffman. Louis f’ing C. K. Some days I think I may be the last man standing in showbiz. The public now knows, or has re-learned, that the powerful in Hollywood can and often will take advantage of the less powerful in highly unpleasant physical ways.   Unpleasant not just for the victims, but even for the nearby potted palms.

    It took actress Molly Ringwald, writing in the New Yorker, to make a crucial connection.   She wrote about her experience with the early Harvey Weinstein, just launching his career.   He didn’t assault me, Ringwald reports, although she was treated to his bullying jerk behavior on set.

    The resulting film bombed at the box office. But, she said, she learned that people who have gross points in a movie make money even if the film tanks. Ringwald learned that because her lawyer called her a year after the movie’s release with the news that Weinstein had not yet paid Ringwald the money he owed her.

    I had been planning to say at this meeting that what Harvey did to young actresses physically, his colleagues in studio front offices do to men and women, young and old, financially.   Molly Ringwald had just made that point concrete.

    Creatives have made some moves to unite against the powerful men, and very occasional women, who determined our fates.   We started forming unions in the 1930s, when that was still a dangerous idea, at least in the US.   Auto workers were getting beaten up for unionizing.   The messaging of the unions sometimes left a lot to be desired. Unlike the militant-sounding industrial groupings of the US and UK, the actors union’s name resulted in an unfortunate acronym: SAG.   Sir, the man from SAG is here, and the man from WILT is waiting.

    A serious attack on creative people’s rights actually came from inside the labor movement during the time when Ronald Reagan—I think you may have heard of him—was president of the Screen Actors’ Guild.   We later learned that he was serving the interests of Hollywood’s chief mogul of the time, Lew Wasserman, whose MCA, thanks to Reagan’s waiving of SAG rules, was allowed to be both a talent agency and a film studio.   As a further favor to Wasserman, Reagan’s SAG ended up excluding movies made before 1948 from the requirement to pay residuals.

    The Hollywood unions have a more enduring weakness: the vast majority of their members either don’t work or work at entry-level jobs.   Ownership of the copyright, or more control over their image and likeness, or payment for uses in unimaginable new media in countries Americans can’t find on a map— they’re all far down the list of those members’ priorities.   The main one is always the same: a slight increase in the basic minimum scale.

    And of course, unions are national organizations, being squeezed on one side by three decades of anti-union pressure from the US and UK governments and on the other by the increasing pace of globalization.   When the man from SAG sits across the table from the man from 21st Century Fox, it very accurately mimics the default state of the industry: a dramatic asymmetry of power between those on the creative and business sides.

    Because the dirty little non-secret of our industry is that many of if not most of us—writers, actors, musicians, maybe even directors—would do this work for free. In fact, we do, all the time—theater workshops, endless auditions, jam sessions after hours, creating demo reels, ghost-writing on spec—we prove it every day: we want to do this work no matter what.   Call it love, call it desperation, call it a sickness or a gift—the business guys know it.   They can smell it. And, by the way, they wouldn’t do their jobs for free if you paid them.

    That’s where we are.   Where can we go?   We get bigger, we get global.   Okay, and then? Why would the global business guys talk to us as anything but petitioning global peasants? No reason in the world, unless the current, long-standing business model—screw the talent, financially and otherwise—is successfully challenged, and probably more than once.

    That’s the little task I’ve taken on.   As you may have heard, unless we’ve totally wasted our publicity budget, my colleagues and I are suing a large company over the earnings of a small film called “This Is Spinal Tap”.

    I won’t name the company, they can spend their own publicity budget.   The four of us created the characters, many of the situations, and most of the songs long before there was any deal with any studio.

    We created what’s now known as the mockumentary form, in order to tell the story of a mediocre English heavy rock band on a somewhat disastrous North American tour in the most believable way. In 1982, my three partners and I signed an agreement with Embassy Pictures, Inc. for the production, financing and distribution of This Is Spinal Tap. The agreement ensured profit participation payments, at the rate of 40 percent of net receipts, to us based on all sources of revenue, including merchandise and music.

    Three-plus decades later, the film still shows in theaters on cable television, many of its more famous pieces of dialogue are almost overly familiar catch-phrases, and people on Twitter are telling me how many copies of he film they’ve bought, in every different format in which it keeps, somehow, being released. The film’s accolades include being named in the New York Times Guide to the Best 1,000 Greatest Movies Ever Made list, Total Film’s 100 Greatest Movies of All Time list, and achieving the coveted Number One spot on Time Out London’s 100 Best Comedy Movies list. In 2002, the US Library of Congress (the world’s largest cultural collection), designated it as a culturally, historically or aesthetically significant film. It was produced on a shoestring budget of US$2.25 million.

    Yet This Is Spinal Tap and the music and merchandise that it and the band have spawned, earned tens of millions of dollars in revenue, according to our complaint – through re-releases, album and singles sales, merchandise sales, and distribution of the film in various formats, across the globe over the course of the last 32 years.  However, these profits were not fairly shared with the four co-creators, cast or crew. In fact now, more than three decades later, we can count what we’ve been paid from the proceeds of what has turned out to be a quite successful film and its associated sound recordings in double digits.

    Let me be fair: high double digits.

    I’m not going to litigate the details of the case here, lest my attorney have a heart attack.   But it’s important to point out that the only thing that distinguishes our experience from that of our fellow creators is the fact that, through many strokes of luck, we’re in a position to challenge what’s happened to us.   Some numbers will tell the story: In 2013, EU writers and directors shared 0.37% of the EU audiovisual sector revenues which totaled €122 BILLION.   I’m sure it must have gone up more recently, maybe even to 0.38% .

    But don’t cry for them, Argentina.   US writers and directors enjoyed, as a percentage of the $632 BILLION US audiovisual market: a share equaling 0.34%.   Yes, it’s true—the US may no longer be leading in many other areas of human achievement, but when it comes to screwing the talent, We’re Number One!

    One successful lawsuit—obviously, I’m thinking positive thoughts here—or even several won’t solve this structural problem in our industry.   But my experience so far with our legal action tells me one thing: people who have helped create popular entertainment can garner important public attention for these issues.   When the audience sees the stars/creators of a movie or television show they very much like fighting against anonymous corporate predators, something amazing can happen: a little bit of that built-in asymmetry of the industry can get temporarily reversed.

    One way that can happen is through a website our team has created. It’s called Fairness Rocks.   Its aim is simple and grandiose.   We want to collect the stories of writers, directors, musicians who have been subjected to financial Weinsteinism. The point is to keep attracting the media’s attention to an incessant drumbeat of these stories, to pound home, hopefully in 4/4/ time, the message that this is what’s happening to the people who devote their lives to creating the entertainment you love.

    I also think it’s high time we correct a basic messaging error .   We’ve let the guys in the business offices make off with something very valuable that we owned—the title of creators. It started, of course, when the US Writers Guild turned the copyright over to the producers, allowing Fox and Warners and Disney and Sony and the others to say that they are the “authors” of their films and TV shows.   And ever since they have hidden their financial predation under the rubric of “creators”.   We even saw, during the Napster era, record companies posing as the defenders of creators’ rights.   Based on my personal experience and years of observation, record executives wouldn’t recognize a creative right if it crawled up their rump and bit them in the pancreas.

    So I suggest we re-brand ourselves, using the sometimes pejorative name they call us—namely, the talent.   Or, as it sometimes comes out of the mouths of the Weinsteins of the world, a “piece of talent”. It focuses the public’s attention on what we all bring to the table.   The producers may control the green lights of the world, but we control the processes that make something where there was nothing.   We are   The Talent.

    A “me-too” movement among some well-known talent has the potential to create a tipping point analogous to the current “Weinstein effect”. For our part, my team, and the journalists who’ve done stories on our legal action thus far, have all been careful to make one crucial point: that we were not being singled out or picked on, that, on the contrary, our experience is business as usual.   In fact, it is the very business model of our industry.

    Maybe that’s why so many companies from other industries—from Coca-Cola to Sony to Rupert Murdoch’s news empire—have seen and continue to see the business of ripping off the talent as a highly attractive investment.

    Some of you here today have to maintain business-like relationships with those on the other side of the table, to be moderate and responsible, to get your jobs done. The rest of you can join me in denouncing the financial predators of our business every chance you get.

    My experience with The Simpsons has taught me that people on our side of the fence only get what they deserve when they stay united.   I look at the unity of the cast from Friends and can only weep with envy.   So craft divisions and national divisions are our enemy every bit as much as the financial predators.   We need to be, and to stay, united.

    Let’s go get ‘em. Thank you.

    © Harry Shearer 2017

  • Fairness Rocks news

    SOURCE: W&DW Congress Keynote Speech

    Date: November 16, 2017

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  • The Music Aggregator: Getting Unsigned Artists and Boutique Record Labels into the Digital Marketplace

    The Music Aggregator: Getting Unsigned Artists and Boutique Record Labels into the Digital Marketplace

    Intermediaries emerge in markets to help reduce inefficiencies by lowering transactions costs, providing better information about market standards, technical requirements (in this case of music) and increasing quality by enforcing compliance.

     

    Aggregators in the recorded music industry act as legal intermediaries between small independent owners of sound recordings – usually artists and record labels – and digital services. They provide a rights holder the opportunity to have their recordings licensed to many digital services through a single entity.

     

    To use an aggregation service a rights holder must grant all rights necessary to enable the aggregator to sub-license their recordings to digital services. There is no transfer of ownership in this contractual relationship, only a short term assignment of rights (usually a year or two). In return, the aggregator agrees to license the recordings to digital services, collect all royalties due, and to account and regularly pay the rights holder.

     

    An aggregator’s revenue mostly comes from charging rights holders, not digital services. There are two dominant pricing models used across the industry. The first model is based on sharing the income generated by the exploitation of the recordings, from which aggregators retain an agreed share. In the second model rights holders receive 100% of the royalties in exchange for a fixed fee per track, or per month. This option is usually preferred by rights holders that have fewer recordings and high sales expectations.

     

    Most aggregators also act as technical intermediaries between rights holders and digital services; these aggregators are usually referred to as distributors. As well as licensing recordings, they store, encode and deliver audio files, artworks and all the underlying data to digital services. This is usually offered for an additional fee per track, or a higher commission rate (usually between 10% and 25%).

     

    So, do aggregators solve all the problems of supplying services with music, or do they introduce new problems?

     

    Many rights holders don’t have the resources or bargaining power to license their recordings to hundreds of digital services on favourable terms, and manage royalty reporting and payments on a global scale. Aggregators have also helped digital services reduce the legal and administrative cost involved in licensing a wide range of catalogues.

     

    However, by adding an additional layer between the artist and its audience, aggregators can reduce control and transparency over how and where recordings are exploited. Whilst some aggregators are better than others, a number of NDAs in licensing contracts with digital services prevent them from sharing all information about the exploitation of their recordings with the creators and the rights holders to whom they are providing the service. This can be frustrating for the talent and for the label.

     

    For a recording artist that controls their own work and wants to reach the market, there are many aggregators and deals on offer. Bearing in mind the caveats outlined above, here are a number of variables that should help navigate between aggregation deals:

     

    • Transparency: how much does the rights holder know about the exploitation of its recordings?

     

    • Third Party Rights: Is the aggregator clear about the position in respect of third party rights?

     

    • Control: does the rights holder have any control over the exploitation of its recordings?

     

    • Termination: is the process made easy by the aggregator? Are there fees involved?

     

    • Reporting and Payment Frequency: how frequent are reports and payments sent? Is there a minimum payment level?

     

    • Fees: what is the pricing model? If the aggregator retains a share of the revenue, is all revenue included?

     

    • Exclusivity: is it possible for rights holders to use the services of another aggregator for the same recordings?

     

    • Additional Intermediaries: does the aggregator license recordings to digital services directly or does it use another aggregator, thereby introducing another layer between the talent and the marketplace with potentially an additional revenue share?

     

    • Audit: does the rights holder have the possibility to audit the aggregator’s accounts?

     

    A traditional record label or publisher is strictly speaking an aggregator of sorts, but their acquisition of the talent’s rights, and their long term (sometimes permanent) retention of those rights transforms them into a more conventional corporate entity. The large copyright holdings then become capital assets to be manipulated and used to leverage growth. Further, their contractual accounting obligations to the talent apply only when the income can be directly and identifiably matched to individual works. This condition serves to allow a label or publisher to retain lump sums for the benefit of shareholders and executive reward, and, crucially, acts as a powerful disincentive to their developing accurate reliable works and writer/performer data.

     

    The true aggregator’s flexibility, model of accounting to clients and the granular nature of usage analysis creates a less impeded revenue flow through to the talent and arguably makes an aggregator a more attractive partner for many music creators and boutique catalogues.

     

    © Pauline Bertinet, The state51 Conspiracy http://state51.com/

  • Fairness Rocks news

    SOURCE: The state51 Conspiracy

    Date: November 9, 2017

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  • Rights and Revenues for Actors

    Rights and Revenues for Actors

     

    Behind the Glamour

    Performers working in the audiovisual sector, whether in film, television or digital media, have been effectively subsidising these industries for as long as they have existed. This may sound like a bold statement, but it is in fact quite accurate for an overwhelming majority of them. Behind the glamour there are countless small players moving the audio visual industry.

    What performers want most is to entertain a public, either live or on camera. It is their ultimate raison d’être, their passion, and they would endure just about anything to be offered a chance to express their talent. This is what makes them great, but also what makes them extremely vulnerable. Most of them come unprepared, as they enter this business, to face a tough and highly competitive environment.

    The image portrayed by the media is misleading: most performers do not live a life of riches and in fact struggle to make ends meet and pay off their monthly bills. Audiovisual performers have highly irregular career patterns, as they constantly need to be cast for new roles, juggling between short-term employment opportunities in the industry, casual work and unemployment. Every new opportunity to be cast for a role may be their last.

    The irregular nature of their career is a stressful component of their daily lives but also a hindering factor as they seek social protection. Social security systems are often ill-equipped to deal with freelance work, as they continue to be built on more traditional, open-ended forms of employment. As a result, many performers working in the audiovisual sector have limited or no social benefits. Adding insult to injury, they are increasingly warmly encouraged to embrace self-employment, often with a view to reducing employer costs. Under antitrust rules they may then find themselves classed as “undertakings” and therefore banned from negotiating acceptable minimum terms and conditions collectively. As independent contractors, they also have to take up private insurances to assist with anything from medical treatment to retirement. Many performers cannot afford to do so and thus find themselves in dire straits should they hit a bad patch.

    Contractual”Freedom”, Perpetual Exploitation and Perpetual Loss

    One singular characteristic of their work, however, is that their performances can be successfully exploited on various media and for a long time, continuing to generate fresh strings of revenue. In light of their precarious professional status, it is immensely meaningful to them to get a fair share of the income generated by their work, over and above any fee that may have been paid to them for delivering the initial performance. Every little payment can make a huge difference to them.

    Only a handful of high profile performers actually have enough leverage to negotiate adequate fees and use payments, either in the form of residuals, royalties or a combination of both. Even in those cases, it may be challenging for them to know exactly how much revenue is due to them, for which use and, more generally, to enforce the terms of their contract. Additional pay-outs will typically be subject to prior cost recoupment and, oddly enough, this seems to be one of the few industries in the world operating at a perpetual loss.

    The only “contractual freedom” for performers with less bargaining power is to sign a contract over which they have no say – and thus get their next job – or to not sign that contract and face prolonged unemployment. When such performers are in a one-to-one relationship with a producer and without the benefit of a comprehensive union agreement, contracts are consistently one-sided and imbalanced. They are colloquially referred to as “buy-outs” and imply sweeping permissions for use of a performance, in all media, in perpetuity and in the entire universe in return for an often-symbolic, upfront payment.

    It is not uncommon for contracts to include abusive provisions with respect to future use and/or media, or even forcing the performer’s consent to deliver extra work, e.g. dubbing or marketing appearances, for no additional premium. Contractual “freedom” usually leaves performers empty handed. In many countries around the world, it is even normal practice for them to work without the benefit of a written contract, leaving them with no redress when seeking to claim what is due to them. Needless to say, most performers hardly dare to voice an objection for fear or being blacklisted and losing future job opportunities.

    Audio vs Audio Visual

    Many countries around the world still grant intellectual property protection to audio performances only. This is due to the fact that international norm setting struggled for many years to reach consensus on the rights of performers in film or audiovisual media. This incongruous situation finally came to an end with the adoption of the WIPO Beijing Treaty on the Protection of Audiovisual Performances in 2012, currently under ratification. Signed by 122 countries, the Treaty will not enter into force 30 eligible parties ratify or accede to it.

    The provisions in this Treaty are long overdue and will give audio visual performer key economic rights in relation to their performances to which licence fees would attach:

    • The right of reproduction
    • The right of distribution
    • The right of rental
    • The right of making available*
      *for more detail about the making available right see: Rights and Revenues for Music Performers.

     

    When implemented in national laws, the Treaty may finally grant an effective and meaningful protection to audiovisual performers and there certainly are built-in mechanisms to make this happen. This is not a given however.

     

    The potential advantage of these rights would be seriously undermined, where, for example, the national transposition legislates for the transfer to their producer of all these economic rights granted the talent. National legislation could do this by way of statutory presumptions. Such normative provisions would inevitably end up perpetuating the weak spot in which performers are customarily found right from the start and would be custom-made to satisfy the corporate interests of the industry.

     

    Understandably, a producer would not wish to negotiate terms and conditions with each and every performer that is cast for a production. However, there are much better ways to ensure the smooth running of business than by stripping all economic rights away from the performer at the point of contract. Certainly one of the best is the tried and tested method of concluding collective agreements with representative trade unions, setting out acceptable minimum terms and conditions. There is also the device of revenues from usage managed via collective management organisations which, in Europe, are obliged to meet legislative standards of governance and transparency. (See the US talent guilds and Collective Rights Management here)

     

    Collective Bargaining
    Union-negotiated agreements are the only way for most audiovisual performers to rely on a minimum safety net, above which they may try to reach individually. Most of them in practice will agree to work for those minimums that become, in essence, the industry standard. In addition to addressing key aspects of working conditions – e.g. working hours, rest periods, meals, health and safety, insurance coverage, etc. – collective bargaining agreements set out how much performers are to be paid when their performances are used in primary and secondary markets. In addition to performance fees, they may thus also establish residual payments or royalties, or a combination of both.(Broadly, a residual is a pre-established payment calculated as an agreed percentage that is determined by collective negotiation by a guild or trade body and is different depending on the type of exploitation. A royalty is calculated by reference to the revenue arising from the exploitation itself, and is established by contract and expressed as a percentage of a price base – for example, retail, or wholesale or as a percentage of the licence fee.) Compliance with these agreements grants a producer the necessary legal certainty when exploiting the performance, without the need to engage in time-consuming individual negotiations.

     

    Few talent unions, however, have gained enough leverage to stand strong at the bargaining table and improve the wellbeing of performers hired under the terms of those agreements. Those that can are notably those that managed to become very representative in countries with a sizeable audiovisual market. These unions have had to fight hard and in solidarity with each other to combat practices of a globalised industry such as flying talent across the planet not just to shoot on location but also to evade union jurisdiction. Where they have managed to do so successfully, it was always by building a stronger and cohesive membership.

     

    In several other countries, trade unions struggle, despite their efforts, to exert jurisdiction and influence over revenue-related matters. This is due to a variety of reasons: from assertive anti labour policies to the overzealous application of antitrust rules, the strong resistance of producer bodies or even the performers’ own perception of themselves as artists rather than workers.

     

    Performing is a highly skilled craft and without performers much of the entertainment our audiences enjoy on screen, television and digital new media would simply not exist. The content industry stands as a major GDP contributor and a powerful driver of innovation and technology. Films, television series, and other audiovisual content, including advertising, permeate our lives – not simply for people to enjoy but equally to be informed and educated. And yet, by and large, performers continue to subsidize these industries, as their creative skills are not adequately acknowledged and rewarded.

     

    The International Federation of Actors (FIA) represents performers’ trade unions, guilds and professional associations in about 70 countries. In a connected world of content and entertainment, it stands for fair social, economic and moral rights for audiovisual performers working in all recorded media and in live performance.

     

    In order to try and rebalance the interests of industry and the talent upon which industry depends the International Federation of Actors (FIA) together with three other organisations representing performers in Europe: AEPO-ARTIS (http://www.aepo-artis.org ), the International Federation of Musicians (FIM) and the International Artists’ Organisation (IAO) are carrying out a campaign to introduce into European legislation a right to remuneration for performers, collected from downloading and streaming platforms and managed by performers’ collective management organisations. Links to these organisations are found here on Fairness Rocks.

    The International Federation of Actors (FIA) http://fia-actors.com/

  • Fairness Rocks news

    SOURCE: FIA

    Date: November 9, 2017

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  • How Screenwriters and Directors actually Get Paid

    How Screenwriters and Directors actually Get Paid

    The importance of fair remuneration for our culture and economies

    When one thinks about writers and directors, one instinctively pictures the handful of superstar movie moguls that in our minds, define the profession. The reality however is that the overwhelming majority of audiovisual creators are relatively unknown, self-employed individuals that face a huge challenge in their profession.

    They are not wealthy, do not benefit from sick pay, pension or regular wages, and are engaged in a full-time career where a huge proportion of their work is unpaid. Each project can take years to come to the stage or screen, and there are absolutely no guarantees that it will not stall on the way. Usually, the only way that they can remain in the industry is to try to earn a livelihood from their royalties from previous projects and use them to navigate the cycles of paid and unpaid work.

    Unfortunately, because of the way that screenwriters and directors actually get paid, the option to earn an equitable living from the success of their back catalogue is more often than not, denied them.

    “We are fortunate and grateful to be able to do a job we love but that doesn’t mean we should be denied the opportunity to share in the success of our work.”

    ­– Yves Nilly, French screenwriter and President of Writers & Directors Worldwide.

    The Remuneration Process

    The principle for fairly remunerating audio-visual authors is well established in international copyright protection instruments such as the Berne Convention, the WIPO Copyright Treaty and the 2012 Beijing Treaty. In practice however, it’s far more likely that authors will be forced to accept whatever contract is offered. And in most cases, this will be a crude lump sum payment rather than any kind of equitable share in the ongoing success of the work.

    The 2015 economic study into screenwriters and directors’ remuneration in Europe, conducted by SAA [insert link on FR site to SAA] revealed that in 2013 writers and directors received only 0.37% of the revenues within the EU’s successful audiovisual market – a market valued at €122 billion.

    The reason that authors can’t negotiate harder is that without an unassignable, unwaivable right to remuneration set into law, they have a vastly weaker negotiating position against the powerful, well-funded producers and distributors. For authors who don’t earn a living from their back catalogue and who are about to begin the long, unpredictable process of bringing new work to the stage or screen, holding out for a better deal is simply not an option.

    Walking through the individual steps of this process, one can understand just how challenging it is for audiovisual creators and why so many of them do not survive the journey.

    The development of an original film project for example, begins with the creative stage for the author. This comprises all of the brainstorming, storyboarding and development necessary to produce a single concept for a project. These ideas are continually reworked until very occasionally, they lead to the writing of a screenplay or the composition of a team of authors. This process alone can take several years to complete.

    The finished screenplay is then used to locate an appropriate producer. This essential step generates the funding to advance the project but if it’s unsuccessful, the author must start again at the very beginning.

    The next stage requires the producer to acquire the rights from the author to use the work. Because independent authors negotiate this acquisition from such a point of weakness, the majority of them receive their first and only payment at this stage. This inequity is exacerbated by having the negotiation take place prior to the start of production and long before anybody could accurately estimate the value of any future success. There is therefore no way to ensure that this initial payment is fair for either party.

    The following stage of the process is occupied with pre-production as the team begins refining the work. Potential sources of further funding are investigated while the producer evaluates the commercial potential of the project, estimating budget and return on investment. This can take up to six months.

    Production and post-production can then consume another year with shooting days for the cast and crew, editing, music selection, special effects, subtitles and so on. With this completed, the process moves into a lengthy period of sales and marketing as the producer looks to sells the rights to distributors who will use the film in different markets. Promotion begins and the authors are asked to support the launch at film festivals, on TV shows and in media interviews.

    Finally, after years of work, the film is released and (one hopes) widely distributed via theatres, DVD, video-on-demand or TV transmission. This last stage lasts for the entire life of the work. The producer receives a portion of each resale payment and other partners receive a return on their investment in relation to the success of the film. The majority of writers and directors however, those whose work is the very core of the entire project, receive no share in this success.

    Why Does This Matter?

    There are a number of issues with the way this process fails the screenwriter and director. However positive the intent, a lump sum payment made way before the project is even produced, is never going to fair to either party. If a film fails, the producer has to bear the cost of this lump sum and if it succeeds, the people who created the initial work are unlikely to have been equitably remunerated. Even worse is that because the journey from idea to finished production is so long and uncertain, the inevitable wait for the next sporadic payment is usually the catalyst that forces such creators to leave the industry altogether. Consider also the issue facing young writers and directors or those from less-developed areas of the world. They are denied an opportunity to build a career based upon the success of their work.

    The net outcome of a lack of fair remuneration is that everybody loses. Screenwriters and directors cannot afford to create. Producers and distributors become starved of exciting new work. The public misses out on the wealth of diverse culture from an industry that can no longer provide it. And the entire world is deprived of the economic powerhouse that creative industries represent.

    To put that last point into context, a 2015 study by EY1 found that the film, television, book and performing arts industries contributed €775 billion to the world’s economy and supported more than 13 million jobs. This is a contribution that any government should fight to protect.

    How Do We Solve This?

    Despite the complexity of this issue, the solution is deceptively simple. A small change in the law for screenwriters and directors can ensure fair pay and restore equality. Imposing an unassignable, unwaivable right to remuneration from exploitation of the audio visual work across all media would bring their rights level with other players by guaranteeing them a fair share in the future success of their works.

    In this law, creators would be listed as authors and would receive remuneration proportional to amount of revenue generated by each use of their work. This right would be unwaivable and unassignable so it could not be ignored or transferred to a third party following an inequitable negotiation. Finally, the remuneration would be paid for by the end users (such as the TV channels or digital platforms) to the organisations mandated by authors to collect and distribute it.

     

    “Right now, Latin America seems to be leading the way in establishing a remuneration right for audiovisual authors. We believe they’re setting an example for the world to follow.”

    – Horacio Maldonado, Argentinean film director and Vice-President of Writers & Directors Worldwide.

    This is not a new solution. An audiovisual remuneration right for some, if not all kinds of exploitation, is already operating successfully in almost 20 countries and has quantifiably stimulated the domestic production of new work. This number is growing all the time with both Chile and Colombia signing it into law in the last 12 months and China well on the way to adding it. Countries all over the world are beginning to realise the tangible cultural and economic value that protecting their creators can deliver. Proposals for such a remuneration right are currently (2017) under consideration by the European Parliament but success is not assured.

  • Fairness Rocks news

    SOURCE: Writers & Directors Worldwide

    Date: September 13, 2017

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  • CISAC position paper on the transfer of value

    Overview

    The way creative works (such as music, film and TV series, books and others) are accessed by users has seen a huge transformation in the last ten years. With the rapid evolution of the digital world, new business models and services have developed along with new channels of delivery.

    This has also changed the licencing environment. Unlike in the past, creative content is no longer exclusively available from digital service providers that obtain a licence and pay for the content they provide. Such content is now widely available and shared through platform-based services. These platform services aim to attract and retain consumers by enabling them to access a vast volume of creative content, as well as information that may or may not be available in a different format elsewhere. These services do not create or invest in content. They aggregate or make available content that is already accessible on other websites or made available by the individual users of those platform services.

    These platform services are at the heart of what is called the “transfer of value” (or “value gap”). The transfer of value arises because of a fundamental mismatch between the enormous value derived from creative works by digital services and the minimal value being returned to the creators of those works. While consumption of creative content is seeing explosive growth, the value of cultural and creative works is being retained by these platform services instead of being passed along to the creators.

  • Fairness Rocks news

    SOURCE: CISAC

    Date: May 25, 2017

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  • Remuneration of authors and performers for the use of their works and the fixations of their performances

    This study was carried out for the European Commission by

    Europe Economics and Lucie Guibault, Olivia Salamanca and Stef van Gompel of the University of Amsterdam

    Abstract

    This study analyses the current situation regarding the level of remuneration paid to authors and performers in the music and audio-visual sectors. We compare, from both a legal and economic perspective, the existing national systems of remuneration for authors and performers and identify the relative advantages and disadvantages of those systems for them. We also explore the need to harmonise mechanisms affecting the remuneration of authors and performers, and to identify which ones are the best suited to achieve this. Their potential impact on distribution models and on the functioning of the Internal Market is also examined. Finally, the study outlines a series of policy recommendations based on the analysis conducted.

    The information and views set out in this report are those of the author(s) and do not necessarily reflect the official opinion of the Commission. The Commission does not guarantee the accuracy of the data included in this report. Neither the Commission nor any person acting on the Commission’s behalf may be held responsible for the use which may be made of the information contained therein.

  • Fairness Rocks news

    SOURCE: European Commission

    Date: 2015

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  • Performers’ Rights in International and European Legislation: Situation and Elements for Improvement

    Introduction

    Under international, European and national legislations, performers are granted a protection for their performances in the field of music, audiovisual, dance or any other category of performing arts. Those rights are generally called performers’ rights. Like authors’ rights, performers’ rights can be divided in two categories: moral rights and economic rights.

  • Fairness Rocks news

    SOURCE: AEPO ARTIS

    Date: December 2014

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