No decision yet from the EC on the status of the online music market

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During a conference on creative rights and cultural diversity organised by
EUobserver on 6 December 2007, José Manuel Barroso, the President of the
European Commission, stated the European Commission (EC) was not yet ready
to take any short-term decision related to the management of the online
music market.

Despite new calls at the conference to review the voluntary guidelines on
the collective management of online music rights issued in 2005 by the EC
and supported by collective rights managers (CRMs), Barroso said the EC
needed some time to find the right solutions based on a balanced,
sustainable consensus of all the involved stakeholders.

The guidelines are not legally binding for the EU states and, according to
the music industry, about 21 out of the 27 members refuse to apply them. The
European collecting societies also argue that the present guidelines favour
big Anglo-American music publishers.

However, as Jorgen Holmquist, director general of the European Union
executive’s internal market unit stated, a public consultation this year has
shown a lack of broad support for this kind of legislation. Yet, he agreed
that the system for managing online music rights was unsatisfactory.

Mr Barroso stated he wanted to ensure that cultural diversity was properly
represented on the Internet. “It’s clear for me that we should not allow
monopolistic licensing structures to emerge in the internet. The repertoire
available in the internet must adequately reflect Europe’s cultural
diversity,” he said.

The EC guidelines presently give authors and composers the right to choose
the collecting society they want to use and also encourage collecting
societies to offer a pan-EU license to music distributors.

Artists, supported by most MEPs, ask from the EC to regulate the online
music market ensuring that CRMs provide a diversified range of music
products, arguing that the present approach does not encourage niche and
local markets. In their opinion, big CRMs will withdraw the successful
international music products from the national CRMs which would therefore
lose audience and which have a significant role in promoting and developing
local talents. Already, some publishers such as EMI have started withdrawing
the repertoires in English from some smaller CRMs.

Industry officials also say that the guidelines could become useless in
case Universal Music Group which is the world’s biggest music publisher
decides to use only one collective society or even none at all.

In this sense, Universal’s general counsel, Richard Constant said: “As we
try to move into a digital world, we are held back by antiquated licensing
practices. Europe is lagging behind (…) The recommendation is
fundamentally flawed. We are still having to go to each society in each
country for overpriced licenses.”

Barroso rules out quick decision on online music market (9.12.2007)
http://euobserver.com/9/25302/?rk=1

EU exec stays above online music rights fray (7.12.2007)
http://www.news.com/2100-1028_3-6221934.html

EDRI-gram: Music: commission wants 1 internet clearing house (14.07.2005)
http://www.edri.org/edrigram/number3.14/music