CMU Trends Labels & Publishers

Trends: The music industry’s big copyright data problem

By | Published on Wednesday 23 December 2015

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A year ago we discussed the collapse of the music publishing sector’s Global Repertoire Database project, an admirable attempt to create a one-stop shop that would be able to tell you who wrote any one song, and which publishers and collecting societies control the various elements of the copyright in each work in each territory.

Given that many songs are co-written and therefore co-owned, the GRD would also have been the uber authority on co-works, recording what percentage of a co-owned song each writer, publisher and society controlled. Where there was a dispute over ownership – so maybe two publishers both claim to own 60% of the same work – a mediation system would be in place that would aim to settle any disputes.

Many outside the music industry are surprised that no such central database already exists, while decision makers in the political community have at various points – usually while considering requests by music rights owners for tougher anti-piracy measures – demanded that music publishers and record companies make it easier to license their songs and recordings, the big starting point for which is better copyright data.

The GRD project failed, but even if it had succeeded, it would only have provided data for the song copyrights controlled by songwriters and publishers, and not the separate recording copyrights controlled by artists and labels.

A whole separate project would have been required to build a database for the latter, and then a final project would be needed to do what is possibly the most important bit, linking the song data with the recordings data, so we know what song copyrights are exploited in any one recording.

Aside from being annoying for licensees trying to work out who they need to deal with in order to utilise any one song or recording, the lack of publicly available copyright data is damaging to rights owners, performers and creators too, because it makes the processing and payment of royalties inefficient.

That is an ever increasing problem as the recorded music market shifts to streaming, because the music rights sector is now >
processing many many more transactions than it did before, but the value of each transaction is often tiny, making it vital that the system is as efficient as possible.

SEEKING AN ALTERNATIVE TO GRD
Despite the collapse of the GRD, everyone agrees that the music industry needs to do something about its copyright data problem. But what? And who is going to lead?

Some wonder if ‘regional repertoire database’ projects – like that created by the ICE venture that now includes German songs society GEMA as well the UK’s PRS and Sweden’s STIM – could eventually merge to form a global hub. Others think that that plan, even if it could work, would take far too long to achieve.

In our trends piece on the GRD last year, we concluded that the solution to this problem might actually come from outside the music industry. There are several start-ups already dabbling in this space, and they won’t be so constrained by the politics and vested interests that will get in the way of any industry-led initiative (and, indeed, did seemingly get in the way of the GRD).

Label owner Bruno Guez, whose own start-up Revelator is providing innovative data services for rights owners, agrees. “I do think that a start-up is a lot more likely to do this than the industry”, he told CMU. “A start-up is providing a solution to a problem, whereas I don’t think the industry is necessarily looking to solve the problem”.

He went on: “The start-up is looking to achieve a specific ‘use case’ and they’ll be very resourceful in scraping the data together, tapping into different APIs and everything they need to prove their use case. There is no reason the industry would do that: it benefits the copyright beneficiaries [ie artists and songwriters], but not necessarily the industry [ie labels and publishers]. A start-up would do it because the beneficiaries would probably be their customers. A start-up has an inherent reason for being a catalyst of change, they don’t necessarily care to be governed by industry politics”.

While everyone in the music community would ultimately benefit from some sort of central copyright database – because of the efficiencies it would enable – Guez is right that it is arguably artists and songwriters who would benefit the most. Because while bad data stops money moving from licensees to the music sector, it also stops money moving from labels, publishers and collecting societies to the right artists and songwriters, meaning performers and creators are stung twice.

Numerous companies in recent years – both established music firms and start-ups – have spotted an opportunity in providing services that help artists and songwriters better manage their rights and royalties, ensuring they get every penny they are due, especially through the collective licensing system. This has been a growth strand of the music rights sector as artists and songwriters have become more proactive in this domain.

Though perhaps the solution to the copyright data problem isn’t a start-up working for artists and songwriters, but a start-up actually led by the artist and songwriting community. Indeed, in the last year the most interesting developments in copyright data have come from that side of music sector: with the songwriter-backed Auddly and Imogen Heap’s Mycelia project.

Both are based on the idea of performers and creators taking control of – and responsibility for – their own data. The logic goes, if rights owners and collecting societies can’t get a GRD together, what if artist and songwriters logged all the works they were involved in creating, and the labels, publishers and societies they are allied to.

If artists and songwriters truly embraced such an initiative, they could see an immediate kickback in increased payments and, more importantly, could engineer a situation where they sit between the digital platforms and the music rights companies and institutions, rather than the other way round.

WHERE DOES THE BLOCKCHAIN FIT IN?
One term that has come up with increased frequency in amidst the copyright data debate this year is ‘the blockchain’ which, some have argued, could help the music community tackle this challenge, with a decentralised approach to building a central copyright database.

The blockchain is a “distributed database”, which is to say a body of transactional data, or a ledger, that is simultaneously stored on multiple servers, or ‘nodes’, across the internet. Updates, or new transactions, that occur at > any one node are gathered into ‘blocks’ which are added to the ‘chain’, with each new block containing information about the previous one, so that all the blocks in the chain have to stack in chronological order. Each node then updates as new blocks are created.

Best known for powering cryto-currency Bitcoin, there are various features about the blockchain that make it an attractive framework for a copyright database, especially for the creative community.

It is decentralised, so does not rely on any one organisation or server, and has in built mechanisms to identify conflicts in data and to stop people tampering with the information it contains, records of which go all the way back to the first transaction recorded.

That said, it is still early days when it comes to utilising the blockchain in the music copyright domain. Even if the artists, techies and start-ups dabbling in all of this – and Heap’s project has a focus on the blockchain – come up with something practical and scalable in the near future, many challenges and questions will still remain.

The blockchain may be the right technology to power a central copyright database. And, if it was truly embraced by the artist and songwriter community, perhaps there would be a source of data available to feed that information network, certainly for new works. But an important question remains: what data is being shared with whom? Even within the creative community there may be disagreements on that point.

WHAT DATA?
Some envisage the blockchain-powered artist-controlled copyright database as containing everything a streaming service would need in order to pay labels, publishers, artists and songwriters what they are due each time a track is played.

So, for each country, who owns the sound recording copyright, which featured artists are due what cut of the income by contract, and which musicians are due statutory ‘equitable remuneration’ if and when such payments apply. Then, what song copyright is exploited in the recording, what publishers and songwriters have a stake in it, what those respective stakes are, and which publishers or collecting societies will process the money.

That database, if publicly available, could then be tapped by streaming companies which could push their consumption data in at one end, and get a list of who should be paid what for each track played at the other. All stakeholders could be reported to and monies paid directly, even where direct relationships between parties did not previously exist.

But – even if we assume we could successfully gather together all that data (which, even with an artist/songwriter-led initiative, is ambitious) – there is still the debate over how much of that information all and any stakeholders would want to make public domain. Labels, publishers and collecting societies are often accused of lacking transparency, but how much information would the average artist or songwriter really want available to the public about their arrangements with their business partners and each other?

It may well be that – despite the artist and songwriter community leading the call for more transparency in the music rights domain – there would only be so much they themselves would want to be transparent about.

Though those, like Heap, who pretty much advocate full transparency, do so while proposing a totally overhauled and much more artist-friendly music industry.

One where artists and songwriters are increasingly reported to and paid directly for their work by the companies who use their music. An industry where less middlemen are required. And perhaps where label and publishing deals are reworked so that while the corporate rights owners have a right to control and earn from the songs and recordings they fund, they no longer routinely filter royalties as they flow from licensee to performer and creator.

All of which might seem a little over ambitious, Utopian even. Though, as the GRD project proved, any attempt to seriously tackle the music industry’s copyright data problem is going to be a major challenge, yet it’s a challenge that is going to have to be met one way or another. So why not set the bar high? And, like Heap, motivate artists and songwriters to make this all happen with the promise of an overhauled music rights sector with performers and creators at its heart, once the various hurdles have been crossed.



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