IAO statement on the World Independent Network (WIN) article “Why ‘Equitable Remuneration’ Is Not Equitable”.
In response to the introduction of a right to equitable remuneration for streaming in Uruguay, the World Independent Network (WIN) published an article entitled “Why ‘Equitable Remuneration’ Is Not Equitable”. We would like to respond…
Please don’t tell us what artists think is “effective” or “equitable”
Clearly WIN was not happy with the law passed by Uruguay’s democratically elected legislature. They are entitled to express their views and the views of their record label members, but we would ask them not to pretend that they understand the position of artists or speak on their behalf.
They say: “The remuneration of featured artists on the internet is already effectively exercised through their Making Available right under commercially licensed terms.”
Sure, it’s exercised very effectively from the point of view of the record labels. But if it is so effective for featured artists why did 88% of them in the 2022 study “Streams & Dreams” say they were dissatisfied with the streaming revenue they received?
They say that introducing ER “would not result in equitable pay-outs to artists”. Perhaps artists should be allowed to be the judge of whether or not ER would result in an “equitable pay-out”? In the same study, only 8.5% of artists opposed the introduction of an ER right.
Please don’t misrepresent research on ER
It’s just not true that the Swedish inquiry concluded that ER is “simply not compatible with copyright.”
The inquiry looked at a bizarre model of ER that no artists or rightsholder organisation had ever requested and which is completely different to the model introduced in Uruguay. The inquiry’s findings had nothing to do with copyright law. The problem was that the specific model was not compatible with the specific provisions of Swedish contract law. So no compatibility problems with EU law, or WPPT legislation etc.
It also found that legislative change was needed to provide performers with greater protection. It recognised the weakness of the making available right… yes that’s the same right that WIN considers is being “effectively exercised”!
In fact, it found the making available right so weak that it recommended the introduction in law of a default position whereby the exclusive making available right could be transferred by the performer to the record label only for a maximum period of three years and only on a non-exclusive basis.
Please don’t tell us “Streaming Is Not Radio!”
Yes, we know. Thank you.
A continuous clichéd commentary on applying the legislative radio model to the making available right is just… tiresome (and more importantly, illogical, impractical and ill-conceived).
Please don’t ignore facts
WIN claim that ER will (negatively) affect consumers and numerous other rightholders. Let’s look at the facts:
The country with the most established history of an ER right is Spain. What has been the impact of ER there?
In September 2022, the Spanish labels trade association Promusicae (representing major and independent labels) reported a 12.4% revenue growth declaring: “The rise is determined by the steady good performance of the digital market, growing almost 15% and leaded (sic) by streaming, representing already 87% of the whole market…”
One year later, they reported a 15.54% increase in audio streaming revenues compared to the same period in 2022.
Regarding the 2023 figures Antonio Guisasola, president of PROMUSICAE, stated that “to keep on presenting growth figures over the world average is a satisfaction to us and encourages the Spanish recording companies to continue investing in Spanish talent, so that our artists succeed within and out our borders“.
Speaking about Spotify in November 2023 on the occasion of their 15th year anniversary, he said “Now, after 15 years, we have seen that the model has worked and has achieved to coexist with other formats. The arrival of Spotify was a change of paradigm, and the education of users, artists and even the industry has been key to its current success“.
The price of a DSP subscription is in line with all other EU countries. The catalogue and services offered by the DSPs are identical to those in other countries. As Spotify stated during the UK DCMS inquiry, “We have not degraded the service in any way”.
They have not been forced to increase their subscription price. They have not chosen to cease operating in Spain. Indeed, in the case of Spotify, it is reported that they have succeeded in negotiating a 32% share of the revenue (not only in Spain), a figure that most artists could only dream of.
As radio is declining, ER payments to artists from their CMO are making up for the loss of radio revenue. It is a matter of fact that some massively successful, very famous artists receive more in ER from their CMO than they do in royalties from their record labels (despite their recordings being streamed millions of times).
These facts speak for themselves: the market is thriving, consumers and artists are happy and the DSPs continue to provide the same service as elsewhere in the world.
Please do support artists
Some of the greatest music ever made has been recorded with indie labels. But these labels (and of course the three majors) have to adapt to the realities of streaming and not continue to oppose what their real assets – the artists – are asking for.
In Latin America, ER exists in Mexico (population 128 million), Ecuador (population 18 million), Panama (population 4.4million)… but Spotify threatens only to leave Uruguay (population 3.4 million).
So is Uruguay the “straw that broke the camel’s back” or does Spotify care so little about their Uruguayan customers and artists, and have such little respect for the Uruguayan government and their democratic process, that they are willing to sacrifice this country for the sake of an embarrassing PR stunt?
DSPs provide a great service. So please, let’s work together and improve the music ecosystem. It’s in everyone’s interests!
Thank you Uruguay!
Finally, we want to take this opportunity to thank the Uruguayan government for their progressive step in introducing the ER law. They listened to the voice of artists and we sincerely thank them for that.
Enhorabuena al Gobierno uruguayo por hacer lo necesario para mejorar la injusta situación de sus artistas en una economía del streaming que no les remunera adecuadamente.