French Gov't Given Proposals In Music Report

PARIS‹A blueprint for the future of the French music industry‹the world's fifth largest‹is about to be presented to Culture Minister Catherine Trautmann.
Trautmann established a commission of industry executives last December to review the problems faced by the music community and to make proposals to the minister (Billboard, Jan. 10). After more than six months of work and following hearings involving dozens of professionals, the 60-strong commission is now calling for a review of practices and has drafted a series of proposals in its report due to be presented to Trautmann in September (BillboardBulletin, Aug. 14). In particular, the commission wants government money reallocated from the classical sector to popular music.
In the opening remarks of the report, a copy of which has been obtained by Billboard, the commission calls for a more active involvement by the government in the music business and more government funding, as well as better allocation of these funds. The commission also criticizes the "lack of strong policy with regards to 'current' music and a lack of coherent action" from the various ministries of culture over the past two decades.
In the report, the commission tackles a wide range of topics, from training to the distribution of music. Following are some of the measures suggested by the commission:
€ The creation of a National Center on Music, whose task would be to support the economy of music and act as a regulator of the music market;
€ The establishment of a set retail price on records;
€ The adoption of a value-added tax (VAT) rate on records similar to that on books, which would require "an exceptional political involvement from France at the highest level" to have this measure adopted by the European Commission, which sets VAT bandings across the European Union;
€ Financial incentives to support independent retailers;
€ Financial schemes to support new independent labels;
€ The encouragement of French music exports by increasing the funds allocated to the promotion of music, and through the creation of export offices in countries such as the U.K.;
€ The appointment within the nine-member broadcasting authority CSA of a member in charge of issues linked to contemporary music;
€ A revision of the law on radio quotas to make them more open to new talent and more flexible to reflect the diversity of the music scene;
€ A revision of the social status of musicians, giving them greater access to state benefits;
€ The development of training schemes for musicians;
€ The recognition of DJs as performers in their own right.
In the radio field, the commission has apparently abandoned the notion of stiffer quotas that surfaced earlier this year in favor of a more flexible approach. At present, French radio stations are obliged to give 50% of their daytime broadcasting to domestic productions. The commission acknowledges that quotas have increased the airplay of French music, but with "perverse effects" in that fewer titles get higher rotations and new talent hardly gets airplay.
The commission asks for the CSA to compel stations to respect their obligations to broadcast "new productions" as required by the 1994 law on quotas. The commission also suggests a revision of the quota law to take into account more diversity‹which, it says, would open the door to a contractual relationship between the CSA and radio stations on the programming commitment.
The commission also welcomes the concept of an agreement between media and producers that would prevent TV or radio stations from creating their own record labels.
Another recommendation that will open a heated debate within the music industry is the suggestion that TV advertising on records should be banned if the VAT rate on records is lowered. Barring that, the commission suggests a tax on TV advertising on music to finance the other measures it suggests.
The commission notes that the French government allocates limited public funds to "popular" music in general‹67 million francs ($11.7 million), compared with the allocation to the Paris Opera of 630 million francs ($110 million).
The report points out that the state collects through VAT on records far more than it reallocates, but that 93% of the budget of the culture ministry that is dedicated to music is used to fund classical music-related projects. "It is hard not to consider that the state taps into the budgets of the youth and the middle class to finance the cultural and economical elite," writes the commission.
Therefore, the commission calls for "an urgent rebalance" of the government's funding. Overall, the commission estimates that the government should allocate some 250 million-300 million francs ($450 million-$600 million) to the sector.
When announcing the creation of this commission, Trautmann said that she was "expecting those qualified experts to come up with solutions to some of the problems faced by the music community in fields as diverse as the record business, television, or live music. Our goal is to set the ground for the development of a musical field as diverse as possible."
However, the minister is not obliged to follow the proposals made by the commission. Industry sources in France point out that the minister may endorse some of the proposals but certainly not the whole book.
The chairman of the commission is Alex Duthil, director of musician's training school Studio des Vari t s. The commission included record company professionals such as V2 France managing director Thierry Chassagne; techno label F. Communications co-founder Eric Morand; live music specialists like Transmusicales festival organizer B atrice Mac ; concert promoter Philippe Maher from SDG Warhead; and artists like rap act Fabe and Laura Mayne from BMG's Native.
However, the commission didn't include any executives from major record companies, even if one considered industry body SNEP GM Herv Rony a member, nor any representative from the radio community.