Publishers Debate Global Online Licensing

Incompetence is not a judgment that is rendered lightly, especially when one is describing one's own industry. But that's exactly the charge leveled at the music publishing business by none other than Nicholas Firth, president of BMG Music Publishing Worldwide.

Firth made his comments here Jan. 23 during a seminar at the MIDEM music industry convention. During a debate concerning global online licensing, Firth stated that the way the music industry has handled this issue "is nothing short of incompetence. I can think of no other industry where there is demand from consumers and demand from clients, and that industry fails to deliver. It's a disgrace, and we as industry leaders have failed."

Others concur. However, with governments already pressuring the industry to establish its own system for online publishing—notably U.S. Sens. John McCain, R-Ariz., and Orrin Hatch, R-Utah—music publishing executives are acutely aware that they must change with the times, and quickly.

"There are governments out there who are going to organize our business for us if we do not do it for ourselves," said Crispin Evans, senior VP of international business and legal affairs for Universal Music Publishing International.

Said John Hutchinson, CEO of the U.K.'s Mechanical Copyright Protection Society/Performing Right Society, "We need to defend against enforced legislation. Governments are demanding that we do something. But we've got the blueprint—let's build it."

On the positive side, initiatives such as the Cannes Accord, signed here two years ago, have forced publishers and European collection societies to engage in dialogue easing the way ahead for both, according to Martin Bandier, chairman of EMI Music Publishing. The Cannes Accord "has given the societies a sense of responsibility in terms of what the commission structure of Europe should be and given [the publishers] a lot clearer voice into how that operates," he said.

Although "100% happy" with the way in which the Cannes Accord has been implemented, Bandier told Billboard that work is already under way to update the terms of the document. "It can be more efficient, and there are areas we are working on negotiating in connection with what we are calling the 'Cannes 2' agreement," he said. "But even in the absence of that, this Cannes Accord has worked very well." Bandier would not comment on the specifics of how he would like the accord to be improved.

On the issue of online publishing, Bandier said, "The biggest thing that music publishers, societies, and record companies have to do is really come to terms themselves, before there is an imposition of regulations and rules by governments, because that never works and then everybody is unhappy. If you have compulsory licensing and statutory dealings, that does not work as well as parties negotiating among themselves, and I've been trying to stress that during MIDEM to societies.

"It's been quite a while we've all been working on the same endless issues, and while we've made some progress, that should have been finished already," he added. "We should have been able to proudly stand up and say, 'We worked out arrangements among ourselves—now let the users come to the societies and get licenses and have the technology to move on.' "

NEW DIGITAL ALLIANCE

To that end, international bodies representing record companies, composers, authors, and publishers announced a new alliance during MIDEM to develop a global digital music initiative.

The International Federation of the Phonographic Industry, CISAC, and European authors' rights body BIEM agreed to cooperate with the Recording Industry Assn. of America to develop by this coming August an "industry standard" system to identify and track all rights linked to the various formats of Internet-distributed music.

The system will integrate existing identification programs such as the International Standard Recording Code and the Information System Work Code.

There were fewer announcements at the convention than in past years. Bandier said, "MIDEM no longer is a meeting place to break deals. We do have great telephone systems, fax systems, E-mail systems now, whereas years ago, when MIDEM first came into prominence, it was a meeting place for making deals because it wasn't as convenient to communicate.

"MIDEM now is an opportunity to get a sense of the industry and a sense of direction [for] what people are doing, where they are going," he continued. "You still get the chance to meet with people from all over the world but not with the thought that you have to make a deal with them."

MORE NEW DEALS

Nonetheless, Universal Music Publishing announced its acquisition of U.K. independent company Momentum Music, the publishing arm of Beggars Banquet Records, at the conventions. Financial details of the deal were not disclosed. Momentum was established in the late 1970s and includes more than 7,000 copyrights by such acts as Gary Numan, Cornershop, and Dead Can Dance.

Bandier's company, EMI Music Publishing, signed a pact to post its catalog on e-media-c.net, an online resource for advertising agencies, film and TV production companies, and casting directors. EMI will use the London-based company's service to generate new licensing deals for its acts.

Also in the cyberspace arena, it was disclosed that two leading European online music services are going head to head in the race to debut the market's first subscription-based digital-distribution service. Digital World Services (DWS), a Bertelsmann subsidiary specializing in digital rights management, inked a deal with Paris-based Zoomzig.com. The DWS offering is due to roll out in March.

Meanwhile, Vitaminic's subscription service, the Vitaminic Music Club, is claiming that it has secured deals with four unnamed companies and that it will be the first such service in Europe.

Away from the Palais des Festivals conference center, the 10,629 delegates who attended MIDEM during its six-day duration took the opportunity to wine and dine with their peers in some of the French Riviera's finest establishments.

The ever-popular Carlton Hotel hosted possibly the social event of the week when producer/Warner Music Group senior VP David Foster was honored as the MIDEM person of the year for 2001 (Billboard, Jan. 27). Foster himself took to the stage to help provide the entertainment, alongside Warner-signed stars Laura Pausini, Alejandro Sanz, and Josh Groban.