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IMMF follows Sony/Spotify contract leak with open letter to European policy makers

By | Published on Friday 22 May 2015


The International Music Managers Forum has used the leak earlier this week of Sony Music’s 2011 Spotify contract as a springboard to discuss the European Commission’s Digital Single Market plans, which, as previously reported, are currently being developed in Brussels. In an open letter, the organisation used this week’s revelations to put the spotlight back on some of the issues it has been vocal about before, in particular transparency.

“Instead of mystery deals hidden from the artists whose copyrighted creations the deals exploit there should be an obligation for transparency”, the IMMF wrote. “Digital promises greater transparency than the old physical markets. We don’t just want artists to be paid fairly, we also want them to get the relevant usage data. It is impossible to prove fair remuneration is occurring without transparency”​.

On the always contentious issue of non-disclosure agreements, the confidentiality commitments that have kept deals like the Sony/Spotify one leaked this week so secret to date, the IMMF continues: “We are not against commercially relevant NDAs. We (artists and their representatives) just want the basic information relating to usage (of the music and the artist’s name and likeness) to be shared with us by our commercial ‘partners’, the labels and publishers. The information relating to ad-revenue services, subscription services, equity stakes, technical payments, marketing payments etc, is as relevant to an artist and their representatives as the information artists expect to receive relating to vinyl records or CDs. Digital should bring transparency and granularity”.

Of course, if every artist and manager was brought within a label’s digital service NDAs, it would arguably be impossible to enforce the confidentiality clauses, because so many people would know the terms, information would surely leak and it would be impossible to know from where. Though a possible compromise is that the accountants artists hire to audit their royalties could be given access to the crucial information NDAed by labels, publishers and the DSPs.

Either way, more transparency might encourage more efficiency too. Which is another issue raised by the IMMF in its open letter. “There is a blockage”, it notes. “How music is delivered to consumers has been transformed by the opportunity of digital, however creators are left with a back office infrastructure which has not yet been transformed by the power of digital innovations (and therefore ultimately consumers are also disadvantaged). A lot of the issues in the music industry arise from the failure to fully seize the digital opportunity to restructure business practices​, and deal terms to reflect the changed environment”.

“The technology exists to remove the blockage”, it continues. “Only two positions in the music value pipeline are essential: i) creators and ii) consumers: Fan to artist, artist to fan. The purpose of copyright is to foster creativity. The purpose of a digital market is to benefit creators and consumers”.

So, lots to digest. Though perhaps the biggest message in the letter to those leading on the Digital Single Market initiative is that artists and songwriters must be part of any debates that occur this year. The management group writes: “In copyright debates it is important that creators, and their representatives, are heard from; labels and publishers are our ‘partners’ but we don’t always have the same interests”.

Read the IMMF’s open letter in full here.