AIPPI Congress Report 1: On a different note - copyright and music

The AmeriKat's jet lag finally taking over,
but not before she brings you news from the
music and copyright panel

While the AmeriKat was recovering from moderating the epic which was the trade secrets session at the first morning of AIPPI's World Congress in Sydney, Warwick Rothnie was being entertained by something more lyrical in the copyright and music panel session.  He reports: 

"Andrew Wiseman (Moderator) introduced the overarching theme of the session as the impact of the digital era on the music industry. 

Prof. Ingrida Veiksa (University Turiba) began by reporting that a survey of the Baltic countries showed that 40 - 50% of the general public were accessing their content via YouTube at least daily. That number rose to 70% to 80% at least once a week. Survey respondents indicated they generally considered that accessing music for free on the Internet was not problematic. 

Andrew Wiseman said this highlighted the problem; the change in business model from bricks and mortar stores to online. 

Lisa Margolis, Senior Vice President Business and Legal Affairs and Chief Legal Counsel at Warner Bros, explained that the music industry’s first response, suing downloaders in the courts, did not prove successful. Dan Rosen, CEO at Australian Recording Industry Association/Phonographic Performance Company, pointed out that the music industry was really the first industry to experience the disruption of the digital revolution so it was perhaps understandable that that was the initial response. Andrew Wiseman noted that film was initially insulated from this disruption by bandwidth constraints and expense. However, price and technology had since evolved. 

Dan Rosen noted that these days the public performance right in the recording amounted to 20% of music industry revenues. Lisa Margolis explained that US law was different to the laws of most countries as, while there is a public performance right in the underlying composition, there is not generally in the recording of the performance. In particular, traditional radio broadcasting strenuously resisted paying licence fees for broadcasting recorded music. Nonetheless, with the downturn in revenues from distribution, performance revenues were increasingly important. 

Prof. Veiksa reported on IFPI’s 2017 Report on Global Music Listening Methods. 85% of young music consumers engaged in streaming; but only 35% did so through paid services, the remainder were streaming via free services. This was the “value gap”. There were for example 900 million users of video streams generating US$553 in revenues. In contrast, however, only 212 million uses of subscription audio services (paid and advertisement supported) generated US$3,904 million in revenues. Further, Spotify (a subscription audio service) pays US$20 per user compared to YouTube paying less than US$1 per user. 

Dan Rosen pointed out that the global music market effectively halved over the last 15 years from revenues from sales of recordings on physical media, largely as a result of piracy. The good news is that the last two years had seen strong growth in digital streaming revenues. The largest revenue streams in the USA, UK and Australia are now for digital streaming and did not exist five years ago. 

Andrew Wiseman noted that we have also seen a shift in consumer perspectives from insisting on ownership of a physical copy to acceptance of paying for access to millions of recordings online.[1] 

Dan Rosen noted that the development of online subscription services meant that in Australia piracy rates were down to 25% from 40%. In addition to making access to recorded music online affordable and easy, the industry is making it more difficult to access pirate sites by actions such as website blocking injunctions. A third limb to this strategy is educating the public copyright infringement and the availability of legitimate services. Lisa Margolis noted that there was increasing pressure on YouTube to increase the payments it made for the copyright protected material in its services. 

All panelists drew attention to the sheer volume of material being uploaded to YouTube. It was argued that the ‘safe harbour’ regimes such as §512 of the DMCA were directed to situations where an ISP was really in the same position as the postal service or telephone company, simply carrying content introduced by other people. YouTube was not even envisaged when the safe harbours were introduced and takes a much more active and integrated role in relation to user content which the content industries consider is qualitatively different. 

One emerging trend noted by Dan Rosen is the increased willingness of artists to stand up and protest about the impact of changing laws and practices on their livelihoods. That has been a big shift since Metallica sued Napster. Prof. Vrieska indicated that it was important to start education programs for children in kindergarten as well as school and university."

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Dan Rosen reported that vinyl recordings had unexpectedly made a recovery in the USA and Australia, now accounting a substantial proportion of physical sales.