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Kobalt-owned collecting society announces global deal with Apple Music

By | Published on Wednesday 5 August 2015

Apple Music

Kobalt, in its ongoing bid to re-invent song licensing, yesterday announced the first big global deal at AMRA, the collecting society the music rights firm recently acquired and overhauled, in order to create a standalone vehicle via which to do exactly this kind of deal. And the first big deal is with that pesky Apple Music.

As you and all Wired readers now, Kobalt has been busy raising the bar in music rights management (or, “saving the entire music industry”, if you prefer) by using clever tech to more efficiently collate, present and process song usage data and royalty information.

The aim is twofold: make royalty processing more efficient for an age where the number of ‘uses’ of any one song can be massive but average payments are tiny; and utilise the net to provide songwriters with much more timely information about how their songs are being used and what royalties they are due.

But however great the tech may be, such ambitions are hindered to an extent by the complicated way song rights have traditionally been licensed, on a territory-by-territory basis, and with so called ‘mechanical’ and ‘performing rights’ often handled separately, even though digital music delivery requires exploiting both elements of the copyright. This results in more middle men and processes between digital service and songwriter.

In Europe, all of the big five music publishers have tried to simplify this process to an extent by providing pan-European licenses to digital services for their entire Anglo-American repertoire, through joint ventures with European collecting societies, so that the deal can cover both mechanicals (directly controlled by the publisher) and performing rights (managed and often controlled by the societies).

Kobalt previously did this in Europe via a joint venture with Swedish collecting society STIM, but it wound up that alliance after acquiring and relaunching AMRA. Through that entity it now plans to offer digital services not just pan-European licences, but global deals, covering Kobalt and other Anglo-American repertoire, with both mechanical and performing rights covered (again via deals with any other societies that control the latter).

Also, while AMRA is being run as an autonomous organisation apart from Kobalt, it is buying in its parent company’s aforementioned data platform, which it hopes will make things super efficient, and also easier for songwriters who are locked into both the publisher and the society for different elements of their copyrights.

Kobalt and AMRA bosses argue that this more efficient system will not only speed up payments, but will also ensure less money is lost to the system, while keeping digital services that like global arrangements happy happy happy.

Confirming the big first deal for the all new AMRA, the society’s CEO Tomas Ericsson told reporters yesterday: “AMRA was uniquely designed for this exact situation – a direct global deal with a major DSP to ensure rightsholders are fairly, accurately and transparently compensated for the use of their music globally. It’s the perfect example of how a new structure and innovative technology will significantly improve returns and transparency for songwriters, artists and publishers”.

Meanwhile Kobalt overseer Willard Ahdritz added: “Both AMRA and Kobalt’s interests are aligned: we want artists and songwriters to get paid for all their music uses around the world. But to get there, applying the standard local licensing structure to today’s streaming world no longer makes sense, leaving too many countries and regions untapped. I’m thrilled that AMRA’s unique ability to make direct deals with the leading streaming players who have a true global reach will allow Kobalt to deliver unparalleled speed, efficiency and transparency to our clients, as well as help grow the music industry as a whole”.