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Sending out an S.O.S. - are Music Publishers in need of saving?
Music Publisher Canada - Winter 2016 - President's Udate
by Jodie Ferneyhough

January 29, 2016

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As I was leaving for the International Confederation of Music Publishers (ICMP) board meetings in Brussels late last year, one of my writers was trying to set up a creative call. I replied that I would have to get back to him the next week, as I was off to save the publishers. He wanted to know if they actually needed saving.

That kind of struck me hard. Do we need saving?

All day long during the board meeting, I heard many stories from my fellow board members - publishers from around the globe - about some of the incredible injustices being forced upon the writer and publisher community. Many of them you know already: the awful deals streaming services have made with labels that leave little or no money for the publisher and songwriter, known as the value gap or disparity in value; the outdated and oppressive consent decree in the U.S. that is now possibly going to allow non-fractional licensing; the continued refusal of our “clients” to give us full data on song uses and the threat of the abolition of the Broadcast Mechanical Tariff and the Private Copying Tariff.

We also learned that in Germany the government is thinking of allowing writers to leave their publishing contracts after five years if a better deal is offered from another publisher. This threatens to completely erode all future publishing opportunities, not only for German writers, but for TV production companies that hold publishing interests and for non-German publishers who sign worldwide contracts only to have writers able to pull out of their contracts in the German territory.

There is the case of Sergey Fedotov, the CEO of the non-profit PRO, Russian Authors' Society (RAO), who is unreachable and no longer able to return to Russia. He now lives in a castle in Scotland bought with writer and publisher money. In India, the PRO and other collection agencies/societies are in a constant battle to try and purchase one another and actually not paying out any money. In Australia, the new Prime Minister comes from the tech world and does not side with copyright holders. It's daunting to hear these stories and know that around the world publishers, song writers and the intellectual property they own and control is being attacked from all sides by governments, tech companies, the general public, record labels and at times from writers themselves. It seems there is no end in sight to the constant attack.

But why? Why is publishing under attack? The one thing all these assailants have in common is that they feel music has value. It has the largest following on the internet and everyone wants to put it in their films, commercials and TV shows or just up on YouTube with the video of the jumping cat.

There have been countless companies that have been started for the distribution of music. Some have come and gone and others, like Facebook, are just getting into it. Companies have built the largest financial empires the world has ever seen from it. Record companies are receiving record amounts of income from it, either through high advances from streaming services or unbalanced rates. According to an article in Music Business Worldwide, publishers spent £162 million on A&R in 2014 compared to the labels £178 million, a difference of just £16 million. That is a staggering amount of money given that the publisher is often doing this without a safety net: no marketing, no promotion, no outlet to get the song to market. The figure represents pure development to get the artist/writer ready for the market where someone else is able to reap the rewards. Yet the labels feel they deserve more of the pie.

There are a number of companies that have secured incredible amounts of money from various lenders and financial institutions to purchase whole catalogues. Sony recently announced it may sell its publishing division. Is it because it's a losing proposition or is it because it is one of the most important and lucrative catalogues in the world and is likely worth the $2 billion it is purportedly looking for?

Why do artists constantly want their songs back? They know there is value in their songs but, if they knew what it took to get laws passed or the on-going struggles to negotiate deals with users including record companies to actually get paid for their songs, they might think twice. There are now, and will be in the future, so many more moving parts that they will never be able to keep up.

The music publisher of the future will absolutely look different than it does today. They have already become experts in collecting new sources of money, sticking with the tried-and-true principle of collecting small amounts of money from various sources. Music publishers are working with song writers in different ways, signing them early, nurturing their careers and empowering them so that they can own and control their own destinies. Publishers will continue to work with users to demand the best rates and the highest compensation for the uses of their songs as they can. They will find a way to continue to negotiate with labels and future distributors of music to find a fair and equitable balance of income in order to allow writers to make a decent living writing the songs that speak to all of us in their own way.

Governments around the world will continue to struggle to try and get the copyright balance right. They will need to learn that big tech companies do not need a break on rates because they are struggling to make it; many of these companies have a larger GDP than some small to medium countries. They will learn that there is value in having multiple layers of musicians, from garage bands to international superstars and everything in between, that music is not just a commodity but also a way to tell stories, to keep traditions alive, to keep local culture local and to allow individuals to express themselves.

I don't think the music publisher needs saving. Users of their music may, however, need saving. How long can streaming services keep running at a deficit? How much longer can record companies make their bottom line at Christmas? How much longer can the consumer afford not to pay for music? How much longer can advertisers and film producers tell their stories if they stop paying for music? Songs will always be written, musicians will always play them, people will always listen, labels will always need more songs and companies will always want to use those songs. It's going to take some time and effort but the music publisher is going to be the one that saves the music.

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