CMU Digest

CMU Digest 10.08.20: Live Nation, TikTok, AM/FM Act, Tunecore, Snapchap

By | Published on Monday 10 August 2020

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The key stories from the last week in the music business…

Live Nation told investors it was still optimistic about 2021 despite its revenues for the second quarter of 2020 being down 98% year-on-year. Although the live entertainment giant’s grim financial stats weren’t a surprise, they hammered home just how big an impact the COVID-19 shutdown has had on the live music industry. But Live Nation bosses said they were confident shows and festivals would begin again next year and that consumers would be eager to return to their venues and events. As proof of that, they said that 86% of ticket buyers had opted to keep their tickets for rescheduled shows rather than accept a cash refund. The company also reported that it had successfully capitalised on the COVID-caused new interest in live streamed shows, adding that it hopes this newly boosted side of the business could out-live shutdown. [READ MORE]

Donald Trump issued an executive order that could lead to TikTok being banned in the US from next month. Although the ban had been expected, the move confirmed that the video-sharing app of China-based Bytedance has political challenges in multiple countries, amid ongoing allegations that the Chinese government has access to TikTok user data. An acquisition of TikTok’s American – or possibly global – business by an American company like Microsoft could as yet avert an actual ban. Nevertheless TikTok competitor Triller, and Instagram with its new Reels functionality, are hoping to capitalise on the current uncertainty. Trump also banned the messaging app of also China-based Tencent, WeChat, although that doesn’t affect other businesses partly owned by the Tencent group, which include Universal Music, Warner Music and Spotify. [READ MORE]

It emerged that more than half of the US House Of Representatives have now confirmed that they oppose introducing an AM/FM radio royalty for sound recordings in America. US copyright law is unusual in not providing a full performing right for sound recordings (it does for songs). The record industry has been trying to change that for decades, so to force American AM/FM radio stations to pay royalties to artists and labels, most recently via the proposed Ask Musicians For Music Act. However, the trade group for American radio has now persuaded enough representatives in Washington to oppose that act, meaning nothing can happen in this domain until after this year’s Congressional elections. [READ MORE]

Music publisher Roundhill sued DIY distributor Tunecore and its parent company Believe over unpaid mechanical royalties. Unlike in most other countries, with downloads in the US the digital platform pays both the recording royalty and the song royalty to the label or distributor. It’s then the label’s job to pay the song royalty – ie the mechanical royalty – to the publisher. In most other countries the digital platform pays the song royalty directly to publishers and/or relevant collecting societies. Distributors like Tunecore pass the responsibility for paying the song royalty onto their clients, ie the labels or artists using the service. But not all of those clients did that work and now Roundhill is trying to hold Tunecore liable for the copyright infringement that therefore occurred. [READ MORE]

Snapchat announced it had some licensing deals in place to make it easier for its users to add music to their videos. The deals are with the Warner labels and publisher, the Universal publisher, indie label repping Merlin and the US National Music Publishers Association. The new functionality, being piloted in Australia and New Zealand, allows Snapchat to compete with TikTok and Instagram’s Reels in terms of allowing users to officially add music to their videos within the app. It’s also helps further boost the revenues generated by the music industry via user-upload and video sharing platforms, an increasingly important form of digital music income. [READ MORE]

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