TONO must at all times ensure that the path from revenue to settlement is as short and good as possible. That is why TONO's distribution committee is so important.
/ 17/10/2022 / Kristian DugstadTONO grants permission to use the music we manage, for a fee. Broadcasters, concert organizers, film and music streaming services, cinemas and so on must pay TONO for the opportunity to use our repertoire. After statutory deductions to the Norwegian Composers' Fund and the costs of running TONO, the results are distributed to rights holders.
Broadcasters, concert organizers, film and music streaming services, cinemas and other businesses that use music must have TONO's permission to use our repertoire. TONO members, and rights holders in other countries, receive compensation from TONO when we have documentation of actual performances.
Kai Robøle is not only the CEO of the music publisher Waterfall Music, creative director of Arctic Rights Management and chairman of the board of the organization Musikkforleggerne. He is also a board member of TONO and chairman of TONO's distribution committee.
– It is important that an organization like TONO always has up-to-date and good models for how money should be distributed and settled. TONO is part of a complex international ecosystem of music rights. Copyright revenues are very important to most authors and music publishers, and both TONO members and rights holders around the world trust that TONO distributes money in a correct and fair way. To achieve this, TONO must constantly ensure that the distribution plan, settlement model and practice of these are up-to-date and best possible, he says.
TONO is subject to strict requirements through national and international legislation, and by partners and competitors. The music market and consumption are changing, and new technology is providing TONO with new opportunities.
The distribution committee is tasked with investigating and discussing how TONO can have the best possible models and policies for distribution at all times. The six members are appointed by TONO's board for one year at a time.
– The distribution committee does not strictly decide anything. We do investigative work commissioned by the board and administration, and can then recommend to the board that changes should be made, but it is the board that decides, says Robøle. The distribution committee therefore works closely with key people in TONO's administration.
Digitalization has created a huge change in many of TONO's business areas.
– There have been major changes in the broadcasting area, among other things. Listening and viewing patterns are changing, and in 2021, for example, the distribution of music performances on NRK had to be changed, which was forced by new access to data and the requirements we face. This was admittedly only a temporary change., because We are working on a major necessary restructuring that is extensive work that will take a long time before we are finished. The purpose is, as always, to ensure that we have models that are sensible and easy to explain and understand, and dynamic so that they work over time, says Robøle.
New technology enables TONO to obtain better information about the type of music used in different performance areas, and thus also allows for even more precise billing. There are also new requirements from outside, in the form of new EU directives and new laws.
The Act on Collective Management sets strict requirements that the organizations' distribution policies be based on models that are as objective, neutral and verifiable as possible.
At the same time, the "TONO companies" also set demands on each other. They are concerned with the most precise reports possible and the best possible data quality, so that payments are linked to actual usage.
When markets and framework conditions change, it not only has consequences for how we settle money. It typically also has consequences for the revenue side – what customers pay. TONO is therefore constantly entering into new negotiations with customers, so that TONO's revenue side is also optimal in terms of where and how music is used by TONO's customers.
– Changes have been made here before, and they will come again. The distribution committee, TONO's board and the administration are working on such issues now as well; this is everyday life for an organization like TONO, says Robøle.
It is a goal that TONO's settlement models should be understandable, clear and transparent. There is an increasing connection between the revenue side and the settlements that TONO pays out.
Christian Onshus, who is member director at TONO and responsible for TONO's billing area, confirms that there is an increasingly better match between the use of music and billing:
– TONO receives reports in most areas, but most of the money from the background music area – that is, hairdressers, restaurants and so on – naturally comes without reporting what music is played, for example by having it on a radio, says Onshus. TONO settles this money based on reported music use in areas such as concerts and broadcasting.
– However, in the last couple of years we have settled an increasing proportion of these based on reports from streaming services that are only used by businesses, and thus we get a higher degree of precision here. We also closely monitor new technology that can help us in this area, he says.
