Business News CMU Digest

CMU Digest 19.06.22: Performer ER, Sony Music, Bestival, Spotify, US Radio Music License Committee

By | Published on Sunday 19 June 2022

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

Belgium introduced a performer equitable remuneration right on streams. It means that musicians in the country will receive at least some of their streaming royalties directly, most likely via the collective licensing system, rather than via a label or distributor. Session musicians will also share in that money. The new right was introduced as the country implemented the 2019 European Copyright Directive. That directive doesn’t specially talk about any ER right on streams, though it does say that EU states should ensure that performers receive “appropriate and proportionate remuneration” from the exploitation of their work. Germany also introduced a new ER right when implementing the directive, but only for streams on user-upload platforms, whereas in Belgium it will apply to all streaming services. Although supported by many performer groups, ER on streaming income remains controversial within the music community, with critics arguing it negatively impacts on the ability of labels to invest in new talent, and that artists who release through their own labels will be worse off financially. [READ MORE]

Sony Music announced the appointment of a new CEO for its Australian division. Sony Music Australia has been without a CEO for a year following the sudden departure in June 2021 of long-time chief Denis Handlin. That sudden departure came as The Guardian ran an article accusing Handlin of overseeing a toxic corporate culture, with ex-employees alleging sexual harassment, intimidating behaviour, alcohol abuse and the unfair treatment of women in the workplace. Handlin himself was not accused of harassment, but he was strongly criticised for overseeing such a toxic working environment. By appointing a brand new leadership team, Sony is hoping to put the scandal behind it and to demonstrate that an entirely new approach is now being employed at Sony Music Australia. That new CEO is Vanessa Picken, who previously worked at EMI Australia in the 2000s, before launching her own marketing agency and working for [PIAS] in LA in the 2010s. [READ MORE]

Bestival founder Rob Da Bank welcomed a judgement in the London courts that ruled he had not personally guaranteed a loan to the old Bestival company. That company was forced into administration in 2018 after several years of financial problems. Da Bank was able to team up with Live Nation and SJM to acquire the Bestival brand out of that administration, so to continue promoting the Camp Bestival event. However, a ticketing company that had previously advanced £1 million to the now defunct Bestival company – and which was still owed £650,000 – went after Da Bank and another former director of the festival business on the basis the two men had personally guaranteed that loan. TicketLine said it was aware of Bestival’s financial position when it advanced the cash, which is why it insisted on the loan being personally guaranteed by the directors. However, Da Bank insisted that he had not been involved in the negotiations with TicketLine and never signed up to personally guarantee any loans. TicketLine sued, but the court sided with Da Bank, who said he was glad that “truth and justice have prevailed, and that four years of exhausting legal proceedings are behind us”. [READ MORE]

Spotify launched a Safety Advisory Council in another bid to overcome criticism regarding how the streaming firm handles misleading and offensive content that is available on its platform. Although it insisted that the creation of the Council was not in response to any one incident, it was the controversy earlier this year around the Joe Rogan Experience podcast – which is hosted exclusively on Spotify – that put the firm’s systems for dealing with problematic content in the spotlight. Other digital companies have also appointed panels of independent experts to consult regarding problematic content, most notably the Facebook Oversight Board, although Spotify’s Advisory Council won’t be as powerful. Spotify explained that “Council members will not make enforcement decisions about specific content or creators – however, their feedback will inform how we shape our high-level policies and internal processes”. [READ MORE]

American song right collecting societies ASCAP and BMI criticised the US radio sector for seeking a joint court hearing to consider royalty rates. Both ASCAP and BMI are regulated by so called consent decrees which, among other things, say that if a licensee can’t agree what royalties should be paid for the use of either society’s songs, they can take the dispute to a rate court proceeding. Previously there were specific judges to hear such proceedings, one for ASCAP and one for BMI. But following the 2018 Music Modernization Act, now one of a team of judges is picked at random to oversee any disputes. With that in mind, the US Radio Music License Committee wants a single judge to be appointed to consider at one hearing its ongoing dispute with both ASCAP and BMI over royalty rates. The two societies fear that that’s an attempt to pit them against each other at any hearing, ultimately pushing the total royalties paid by radio stations into the music industry down. To that end, they have formally opposed the proposal of a joint hearing, insisting that was not the intent of the MMA reforms. [READ MORE]

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