The European Commission has decided that it will no longer allow collecting societies to have a monopoly on the licensing of cross-border online, cable and satellite services within their territory. For several years, the European Commission has wanted to set guidelines for how music rights should be cleared online in Europe. However, the result of this EU decision is that the terms of use of music in online services will now be far more unpredictable for music users, and it may become more expensive for composers and musicians to have their rights managed.
/ 17/07/2008 / codexThe EU is thus throwing musicians, composers, rights holders and music users into chaos. It opens the way for large rights holder groups, such as the large multinational music publishers, to withdraw their rights in the online area and then manage them themselves as rights managers or have them managed by management companies on special terms.
Under the current system, collecting societies clear rights within their own country according to their national rules in this area. The Commission believes that this hinders competition in online licensing for services that operate multi-territorially.
This will likely create chaos for music users, typically online service providers, and lead to them having to purchase rights from multiple sources. This will lead to bureaucratic solutions, expensive licensing processes, and the absence of users' desire for one-stop shops.
TONO currently has reciprocal agreements with all music management companies in the EU and the rest of the world, which makes it possible to offer our customers and users a single license for all music from all over the world. This typically means that a music user such as NRK only needs to have a single agreement with TONO to be able to use the entire world repertoire in its programs. This is of great benefit to both NRK and the rights holders of the music, as it provides simple, efficient and customer-friendly music management, in addition to a reasonable settlement of the remuneration back to composers, lyricists and music publishers. This system ensures that Norwegian music is used on an equal footing with foreign repertoire and that musical diversity is thereby ensured.
But the EU Commission clearly believes that this cooperation between the TONO companies creates a kind of monopoly situation and the EU instead wants the individual rights holders and TONO companies to compete with each other in this market. The only problem is that the result of such a competitive situation means that the music user can no longer obtain their entire repertoire in one place, but instead has to run around Europe to find out who manages which musical works. Such a situation was not desired by either the music users or the rights holders, but the EU has therefore chosen to turn a deaf ear in this matter. The consequence of this may therefore be that Norwegian music will be selected out of the new music services, simply because it will be too difficult to clear the rights. Instead, large users will probably choose the international Anglo-American standard repertoire that is held by the largest companies in Europe.
It is worth noting that the European Parliament has strongly criticized the Commission's approach in the matter and expressed deep concern for the future of musical and artistic diversity in Europe, now that competition is obviously to be introduced in the cultural field in this way.
TONO and the other small and medium-sized European collecting societies believe that the Commission's decision will create chaos for music users online. TONO wants to make it easier to use music and to create music, and we see it as our task to provide an efficient system that can give music users easy access to all the world's music. This also applies to music users who want a multi-territorial license across borders.
TONO is one of Europe's most modern management companies, and we will always be committed to ensuring our members the best conditions that can be given in any management area. Although we deeply disagree with the EU Commission's assessments on key points, TONO will naturally work to ensure that modern management systems are further developed and adapted to new forms of distribution for music. We do this for the benefit of our members and for the creative community that 2,5 million rights holders constitute.
Cato StrømCEO
17. July 2008
Cicac's press release follows:
CISAC and its members count the full costs on creators and users of a recent Commission Decision
Paris, July 16, 2008 – CISAC regrets a recent Decision of the European Commission which targets 24 authors' societies in the European Economic Area. The Decision concerns the reciprocal representation contracts existing between those societies for certain exploitations of musical works via the internet, satellite and cable.
The membership issue raised by the Commission has been taken over by events a long time ago. The interests of the individual creator lie at the heart of collective administration. The principle that creators are free to join whatever society they choose is therefore already well established and widely applied by societies throughout the EEA. As for the issue of exclusivity, the EEA societies have accepted for decades that contracts between them should be based on non-exclusive arrangements.
CISAC's main disappointment with the Decision, however, lies in the way in which the Commission has responded to the territorial delineations within societies' reciprocal representation contracts. Whilst it is true that the Decision's approach to territoriality will inevitably lead to a catastrophic fragmentation of repertoire and therefore to legal uncertainty for music users, it is the Commission's assertions that the Decision is somehow in the creative community's interest which has been of particular surprise to CISAC.
Loudly and clearly (but apparently to no avail), the creative community has told the Commission that the community remains deeply concerned about a Decision which claims to act in the name of creators but which in fact is being imposed on them against their express wishes. Time and time again, the creator has pleaded that the Commission's proposed course of action will lead to a calamitous decline in artistic creation, cultural diversity and creators' income.
CISAC and its members continue to count the full costs of the Commission's decision – not just on the world's 2.5 million creators whose interests have been jeopardized by the Commission's stance on territoriality, but also on users.