Does the music industry still have a need for collective rights licensing organizations? Yes, it does. Will there be a need for their services in ten years, or even five? I’m not so sure about that.
It’s simply called direct licensing, and it’s now seriously threatening a decades-entrenched industry of copyright collection societies. Because once upon a time, it was impossible for a restaurant, club, radio station, or online music service to license or account to thousands upon thousands of rights holders, artists, and publishers. But in 2013, the technology absolutely exists to enable one-to-one licensing, monitoring, and payout deals between rights owners and services.
Which is why the largest companies are aready embracing these direct-deal technologies. For example,
1. The largest music subscription service (Sirius XM Radio).
2. One of the largest independent labels (Big Machine (Taylor Swift, Tim McGraw, Rascal Flatts)).
3. The two largest music publishers in the world (Sony/ATV (EMI Music Publishing), Universal Music Publishing Group.)
4. The largest radio conglomerates (Clear Channel Communications, Beasley Broadcast Group, Entercom Communications, DMX.)
And, why these organizations are fighting it or figuring out a survival strategy. Because in five to ten years, there may still be a need for blanketed, broad-reaching licensing agreements and intermediaries. But at this technological pace, that’s speculative, and there’s a very good chance the following organizations will be critically endangered or even extinct…
Harry Fox Agency
The Copyright Royalty Board (CRB)
PRS for Music (UK)
APRA (Australia & New Zealand)
“Again, the premise of a regulatory agency combined with SoundExchange, an industry-wide organization for negotiating rates through a Copyright Royalty Board… that made a certain amount of sense given the state of information technology in 1980. It makes no sense today.”
Roger Noll, economist.