CISAC cites value gap as biggest challenge facing the biz in annual report

CISAC cites value gap as biggest challenge facing the biz in annual report

CISAC has slammed the value gap created by tech giants such as YouTube as “the most significant challenge we face today” in its annual report.

Over the past year, global CISAC revenues for music creators hit $9.6 billion, yet the organisation’s director general Gadi Oron pointed out that this figure would be significantly higher if the likes of YouTube paid a fair fee to rights holders.

“The environment in which societies and creators are operating is rapidly changing - and CISAC’s agenda is changing with it,” he said in the report. “The most significant challenge we face today is, without doubt, the transfer of value in the digital market.

“Globalisation has created digital distribution giants that generate enormous revenues from exploiting creative works, but refuse to share these revenues with creators. the digital revolution has allowed major users of creative content to arm-twist our sector and dramatically increase our licensing challenges.”

To highlight the difference in royalties paid out by ad-supported video streaming services and those paid by TV/radio and music subscription services, the report provided a breakdown of total payments across each format in 2015.

In the UK, revenue collections from TV and radio totaled $273.5 million and music subscription services 51.5m, with collections from ad-supported video streaming services hitting just 15.3b. To put that into context, the revenues generated from Spotify came from 50 million paying subscribers, whereas the total number of people using YouTube alone is around the 800m mark.

Oran notes that CISAC will look to ramp up its efforts to push the EU for a solution to the value gap.

“This is just the start of a global campaign for change,” he continued. “We are working in international forums such as WIPO and UNESCO, leveraging our position and influence and making the case for change. our music creators’ council Ciam’s Fair trade music project is moving forward and attracting more attention to the issue.

“Working with our members and allies, we have advanced our global campaigns for better rights for visual artists and for audiovisual creators. our push for action by WiPo to promote the resale right helped secure a full-day conference in Geneva, where visual artists showed WiPo their overwhelming support for international adoption of the right. our lobbying with W&DW for inalienable rights for audiovisual authors has culminated in the signing of a new law in Chile - the first of its kind in the region. these efforts directly benefit our members and their affiliates: new rights mean new sources of revenues for creators.”

CISAC president Jean Michel-Jarre also lamented the current situation: “Globalisation has seen an increasing concentration of tech giants with immense power to get creative content on the cheap. They have huge financial resources and lobbying power. So today, more than ever before, creators need a voice to government and policy-makers.

“This is not tomorrow’s issue – it is a huge issue right now. It is being discussed in the European Parliament as I write. CISAC looks to Europe to get this right: to channel fair value for creative works to the creators who made them, and not the digital platforms that exploit legal loopholes to make money from them.”

The report also breaks down its $9.6b revenues for the year by territory. Europe provide to be the biggest driver generating $5.6b, US/Canada $1.9b, Asia Pacific $1.3b, $610m and Africa $69m.


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