President’s Message: The accelerating pace of change

Story by Stan Meissner | Tuesday November 24th, 2015

First of all, I’d like to welcome you to the new redesign of the SOCAN online Words & Music magazine. It’s fitting that this President’s Message is about change and the digital shift in our industry. It’s a theme I’ve written about before, but it continues to swirl around us, so please read on…

Every day, you see something new about how the digital world has affected the music business. These articles range from doom and gloom to the rosy future of the new world. Sure, everything is changing, but of course, change is nothing new. The way people have been consuming (or enjoying) music has been constantly evolving, from piano rolls to radio, 78s, 45s and 33 rpm records, cassettes, CDs, digital downloads and now streaming. The only thing really changing is the accelerating pace of change.

At the dawn of the radio era, songwriters and publishers thought their livelihood was over because it was going to kill the piano rolls business – and it probably did – but still we survived, and thrived. More recently, in a short period of time, we’ve moved from physical to digital, PC to mobile and download to streaming almost simultaneously, not to mention business practices shifting from territorial to global. Change is all around us.

Things have yet to settle down into a fully sustainable business model.

Of course, this whole wave of change started in 1999, with the first hint of Napster. Instantly, the music industry was set on its ear and piracy became rampant. In 2001, Apple jumped into the game with iTunes and the iPod almost immediately after. Likely both a blessing and a curse for the industry, iTunes introduced a viable legal download alternative, but still iPods were capable of holding more than 10,000 songs and it’s unlikely that anyone paid $1.00 for every song contained on them.

It’s hard to imagine that none of this technology and disruption even existed 15 years ago, and it’s equally hard to believe that through that time, things have yet to settle down into a fully sustainable business model. For many young music consumers, the current reality of music “that appears to be free” is all they’ve ever known.

Piracy became the devil of the music industry and only now, for us anyway, with streaming starting to take hold globally, it seems to be less of a concern. Still, 20 percent of internet users around the world access websites that offer music that infringes copyright. There are other owners of digital content who have it far worse than we do, though, with music only representing 3 percent of illegal internet traffic, while film and TV represent about 50 percent (granted there is music in that audio-visual product).

Perhaps the new piracy we face as songwriters and publishers now, though, is coming from within. With the world embracing streaming at a logarithmic pace, somehow the revenue that these services should be generating for us isn’t materializing in a sustainable way. Current rates for songwriters and music publishers are far too low, while labels seem to be getting the lion’s share of the royalties, and in many cases owning equity stakes in the major streaming services. Ultimately, there is very little transparency in the whole system, and while some people may be making money with these services, we music creators certainly aren’t.

A recent example that was all over the news was that of Kevin Kadish, co-writer of the Megan Trainor hit, “All About That Bass.” It was reported that Kevin earned only $5,679 for his share of 178 million streams on Pandora. Clearly, there’s something wrong with this picture. In order to have a sustainable music ecosystem, all contributors in the value chain need to be compensated fairly.

I’ve previously written about Fair Trade Music, now an incorporated entity, that’s been working to establish itself as a certification body for fairness, transparency and ethical and sustainable practices within our industry. Spearheaded by the S.A.C (Songwriters Association of Canada) and endorsed by CISAC (The International Confederation of Societies of Authors and Composers), CIAM (The International Creators’ Council), MCNA (Music Creators North America) and supported in principle by ASCAP and Spotify, with contributions and support from SOCAN and SACEM, Fair Trade Music (FTM) is clearly gaining much traction.

FTM is working hard to define a level playing field among rights holders and music services by seeking to establish credible criteria for transparency and fair remuneration, as well as creating a reputable brand to help make the public aware of ethical players in the industry – as it’s been proven by other Fair Trade initiatives that many consumers would prefer to deal with entities that operate in a fair and sustainable way, not unlike the Fair Trade Coffee movement. Stay tuned for more developments on the FTM front.

Finally, while we’re on the topic of change, on a tangentially related note, sometimes the more things change, the more they stay the same. I’m pleased to report that this past June, following SOCAN’s Board of Directors’ election, I’ve been re-elected to a second three-year mandate as President of the SOCAN Board of Directors. Along with our newly elected board – which turns out to be fairly similar to our outgoing board, but for two members (we welcome publisher Robert Ott from ole and songwriter Safwan Javed) – we’ll continue to work with SOCAN management to guide our way through these changing times, looking for opportunities to ensure that SOCAN continues to build on its strengths, and can thrive in this constantly evolving world.

Photo by courtesy of/courtoisie de Stuart Miles at/à FreeDigitalPhotos.net

Speaking Out: SOCAN advocates politically for music creators

Story by Eric Baptiste | Tuesday December 1st, 2015

In order to effectively support and protect Canadian music creators, and look after their economic interests, SOCAN advocates for our members by lobbying the Canadian government and main federal political parties.

It’s important for the federal government to understand that Canada’s creative economy is one of the most vibrant in the world. This means a rich culture, both historically and currently, including some of the most popular music creators in the world today – like The Weeknd, Drake, Arcade Fire, Shawn Mendes, Michael Bublé, Coeur de Pirate, Luc Plamondon, Les Cowboys Fringants and many more. It also means contributions to Canada’s gross domestic product, export revenues and job creation.

SOCAN is a business that is politically agnostic. Our 130,000-plus Canadian members have a very diverse range of political views, but we work with any and all major political entities that can improve the lives and the livelihoods of our members. We’ve had, and will continue to have, conversations with the main federal parties, whether they’re in power or not.

We thank all the people we’ve met during the last Parliamentary term for their attention to our issues. And we’ve been encouraged by our contacts with key Liberal decision makers before the recent federal campaign began, including what we sense as a strong personal commitment for the cultural industries – especially music – by now-Prime Minister Justin Trudeau. We all remember his surprise visit at the SOCAN networking party on Parliament Hill last May.

Among the many issues of interest to SOCAN are the following:

Swift action on extending the term of copyright protection for songwriters, composers and music publishers from 50 to 70 years after the death of the last surviving songwriter or composer. The previous government did create this extension for sound recordings, but did not do the same for songwriters and composers. Following SOCAN’s outreach, both the Liberals and NDP weighed in on the record during Parliamentary question period supporting this initiative. Such an action would bring Canada in line with modern international norms, supporting productivity and our trade agenda.

Improvement in the way the Copyright Board of Canada works. The government could greatly improve our members’ economic well-being by granting the Copyright Board the resources it requires in order to render decisions on a more timely basis. A recent study showed that the average time it took the Board to certify a tariff was 3.55 years; when hearings are required, the average timeline jumps to 4.42 years. It seems all parties agree on this, and we hope the current government will be the one to make it happen.

Clarification of the numerous and broad exceptions and limitations to copyright in the Canadian legislation, of which there are far too many, especially for a country with such a vibrant cultural and entertainment ecosystem.

Boosting the export potential of our talented music creators and artists. We hope that under Stéphane Dion, the foreign ministry will see the potential of new public/private partnerships in this respect, and SOCAN is more than ready to do its part.

Redefine the private copying regime (started by a Liberal government in the late ‘90s) to catch up with most advanced countries in the world, so that the amazing value being created for some companies (like digital services and digital device manufacturers) out of music can be shared with the very creators that are the originators of that music, and who make that value creation possible.

On all of these issues, the government needs to move quickly. This is the 21st Century; time – and technological change – flow much more quickly than before, so our music creator and publisher members can’t wait until 2017 for a “business as usual” review of the key legislation. Canada is a hot-bed of creative and digital industries, but with the slow pace of political activity, they’re fighting with at least one hand tied behind their backs. And given that these delays in passing legislation span tax years, a sudden one-off payment can also have significant tax implications for our members. If a royalty decision is lower than estimated, SOCAN must reclaim the excess from our members. As such, these delays creates significant economic uncertainty for our members.

We need these issues to be fixed in order to best harness all of our energies and claim our rightful place in the world of music policy: that of a leader.

President’s Message: SOCAN 2014 Activity Summary

Story by Stan Meissner | Thursday July 9th, 2015

Each June, we hold our Annual General Meeting, where we report and reflect back on the previous year. This year’s AGM was held in Toronto, on June 16th, and with member meetings also held in Montreal, Vancouver, Los Angeles and Nashville, SOCAN works hard to keep a strong connection to its members, and strives to be open and transparent. While some items here may seem like old news, throughout this column, we’ll look back and review SOCAN’s activities in 2014. In that 2015 is an election year, this year’s AGM also included an announcement of the 2015-2018 SOCAN Board of Directors. More on that below.

2014 was an exciting year for SOCAN, celebrating our 25th year as a performing rights organization (PRO) in Canada.

Continuing down SOCAN’s path of reinvention, there were many changes and innovations throughout 2014. Among them was the unveiling, at our 25th annual SOCAN Award Gala, of the new award to celebrate major special achievements of our members.

SOCAN’s tagline is “Music. People. Connected.,” and that simple phrase really captures what SOCAN is all about. Connecting people to music, and ensuring that we’re all fairly compensated for its use, is something that we’re passionate about, and it’s a concept we fight diligently to protect. It’s no coincidence that the first thing SOCAN is about is music, and what could be more appropriate than to have the world’s first music award that is also a musical instrument. As both a trophy and an instrument, “The SOCAN” is truly a thing of beauty.

Another major activity during the year was all of the work undertaken in transforming the SOCAN Montreal office, both in preparation for moving to its new premises in early 2015, and in some reorganization and staffing changes. We were pleased to see Geneviève Côté, a former publisher Board member from Montreal, come aboard as SOCAN’s first Chief Quebec Affairs Officer. Replacing Geneviève on the board, according to our previous election results, we were happy to welcome Patrick Curley from Third Eye Music.

SOCAN has seen a year of activity on the copyright front, both with the Copyright Board of Canada and the U.S. Department of Justice (DOJ), who have been busy with actions that affect us as songwriters and publishers in the performing rights organization world.

In Canada, the Copyright Board issued rulings on Tariff 22.D regarding audio-visual (AV) works on the Internet, which had a very positive impact for SOCAN. For T-22.D.1, regarding online AV services, tariffs were confirmed at 1.7 percent for 2007-2010 and 1.9 percent for 2011 to 2013. These tariffs, in addition to other parts of Tariff 22, brought in more than $12 million in 2014. As a result, throughout 2014, our Tariff, Licensing and Distribution committee and Board approved a new audio-visual internet distribution pool to facilitate distributing these new online AV revenues.

In the U.S., we’ve been closely monitoring the situation with ASCAP and BMI, who have to work within the decades-old consent decrees, set by the DOJ, to attempt to protect the market from potential anti-trust concerns. These consent decrees and recent court decisions have been creating problems for publishers and the PROs, with regard to publishers’ abilities to withdraw certain rights and negotiate direct deals, with the rate courts insisting on “all or nothing” relationships between the publishers and the U.S. PROs. This is an evolving situation, and while we continue to actively investigate the potential impact of these actions on SOCAN, we’ve also been examining opportunities for us to be able to thrive in the changing landscape.

Throughout 2014, SOCAN continued down its path of innovation and modernization by further developing our BEST (Business Enterprise Solution for Tomorrow) computer system in order to deal with the explosive data requirements necessary to track the billions of performances in the digital world. The first parts of the system, the Financial and Issue Tracking modules, were deployed in 2014. Ongoing work will see Licensing, Repertoire and Performance information functions handled by BEST in the near future, with the entire system being fully operational by the end of 2016.

In addition to these activities, as part of the ongoing annual work of the Board of Directors and its standing committees: Executive Governance; Risk Identification & Management; Tariff, Licensing and Distribution; and Membership, we engaged in a multitude of tasks, including monitoring and reviewing budgets and forecasts; managing SOCAN’s investments and other financial activities; conducting a 360-degree evaluation of the CEO’s performance; engaging in a thorough Board and peer assessment; overseeing our many member events, including our AGM and awards ceremonies; and reviewing our communication strategies, policies and activities.

Finally, through its affiliation with SOCAN, the Canadian Songwriters Hall of Fame (CSHF) saw its footprint increase with its new website launch as well as the rollout of music education content, in association with Magic Lantern Media, based on the songs already inducted into the CSHF. This initiative will teach the value and cultural significance of Canadian music and, specifically, the impact of songs and songwriters. The CSHF also announced a new partnership with CBC Music allowing for monthly song inductions with original new videos of contemporary artists performing inducted songs, beginning in 2015.

All in all, SOCAN, its Board and staff, had a very active and transformative 2014 and through our efforts and many changes, we continue to shine as a leading performing rights organization in the world.

Now that we’re half way through 2015, it’s clear that much of the work of the last year has helped pave the way for the exciting activities that will continue to be reported on throughout this year. As it is an election year, I’d like to welcome our new Board of Directors, a full list of which can be found here on the SOCAN website. I would like to specifically thank two of our outgoing directors, Songwriter Jim Vallance and Neville Quinlan of Peermusic, for their important contributions to the SOCAN Board over the last three years. And while there are many familiar faces among our returning directors, I’d also like to officially welcome the newly elected directors Robert Ott and Safwan Javed. With such a varied and distinguished group, the 2015-2018 term is sure to be an exciting one. We’re all excited to get started!