Monday, 26 January 2009

Rights and wrongs

Pretty soon the EU will be considering proposals to extend copyright on music to 95 years from the present 50 years... It's a proposal that's being pushed by the music industry -unsurprisingly - so you might think that it would be good for the music industry as a whole and for musicians in particular. Artists will earn more, and we will get a strong and vibrant music industry - won't we? Somehow I am unconvinced.


What does it mean for artists cutting records today?? Well... in fifty years time you can continue to earn on your records for a further 45 years. .. and if not you, then your descendants - at the very least your record label. Well, the fact is that the majority of artists struggle to GET rich on their current success, and earn very little from back catalog sales - and artists themselves see issues with these proposals because of dilution of revenue to go to artists estates, and problems with orphan works..

Anyway most artists trade some or all of their rights to income to their record company in return for someone who will (while it suits them) promote and distribute their music. So 95 years of rights must be worth more than 50 years right? Which means artists can get more when they sign away their right, right?

Well not exactly, that's the rub. Simple economics says that the 'net present value' of a return in 50 (or 90) years time is next to nothing. There is negligable economic benefit to justify any investment now in an asset that matures in 50 years... particularily with no clue as to whether an artist will be of interest then.

So what is the benefit then?? Well... record companies with back catalogs of titles that are 45 years or more old can see an extension of their chance to income from those old works. s soon to be worthless --- and by a stroke of the legislators pen they get to put millions on to their balance sheet.

But now lets assume that the consumer only has so much money to spend on entertainment... and that a record company normally spends a fixed proportion of it's budget on marketing and sales. The tempatation - nay, the clear intention - is that the record company will spend money to market and exploit the back catolog they're sitting on. This has two effects... money they draw in from consumers is money that's not available to be spent on new artists and new creativity. Moreover, because the media giants are focussed on milking their existing assets they are not investing in bringing on new talent and reinvigorating the market.

The nett effect? Today's culture loses out - the sources of revenue for new artists are lower - the opportunity for new artists to reach a wider audience are fewer, and the exposure of the audience to new music is less. We are culturally poorer - and fewer musicians are able to earn their daily bread.

Copyright is a limited monopoly granted by society to protect society's cultural interests by allowing artists to be supported from their creativity. But it's clear that for the most part this proposal does nothing to further the publics interest, nor even that of most artists... it is quite simply a protectionist measure which benefits two groups...

First there are the music companies that today have a soon to be worthless back catalog that can expect to get in effect free money from a change in the existing rules.

..and yes, there are some artists that continue to be popular and sell in volumes two generations after their initial work is published - but to be honest, songs that have been around for fifty years - especially well known and popular ones are very much part of the public domain. An artist or his/her record label have had more than enough time to rake in a reward for the months, weeks or minutes it took to produce.

Or as one academic put it... this idea is good only for "record companies, aging rock stars or, increasingly, artists' estates. It does nothing for innovation and creativity."

No comments: