The Belgian and Dutch music copyright collecting societies are to drop their claims of national exclusivity on the licensing of online rights. SABAM and BUMA, that manage the music copyrights for authors in Belgium and in the Netherlands, have announced this intention to the European Commission, after the Commission started in-depth investigations into the problems of online music licensing in the EU. In July 2005, the Commission proposed a serious reform, granting every artist the right to freely choose a collecting society anywhere in Europe to exploit their online rights.
The European Commission now invites public comments on the proposal from the two collecting societies. In the notice in the Official Journal about the consultation, the Commission states: "Given the fact that there is a
The European Commission wants to create 1 European internet rights clearing house for internet content providers. An in-depth study into the current collective management of copyrights shows that a company that wishes to start an online music business has to seek clearance with 25 national copyright management organisations and has to sell no less than 4.75 million copies of a single song to just recover the cost of the necessary licenses.
The Commission quotes an example from Edima, the organisation representing online music providers. "The direct cost of negotiating one single licence amounts to 9.500 euro (which comprises 20 internal man hours, external legal advice and travel expenses). As mechanical rights and public performance rights in most Member States require separate clearance, the overall cost of the two requisite licences per Member State would amount to almost 19.000 euro. As clearance is required in all 25 EU territories, the cost of obtaining the necessary 50 copyright licenses would amount to 475.000 euro. On the basis that a profit of 0.10 euro can be achieved per download, the online music provider would have to sell 4.75 million downloads merely to recover the cost associated with obtaining the requisite copyright licenses." (p47-48)
The Swedish anti-piracy group Antipiratbyrån made the news with yet another embarrassing incident. The Swedish data protection authority has forbidden the organisation to collect the IP-addresses of internet users engaging in file sharing. In an incident reported earlier in EDRI-gram, the group convinced the police to raid the offices of Bahnhof, the oldest and largest Swedish ISP, and confiscate 4 servers with unlawfully uploaded content. But Bahnhof in turn successfully accused the anti-piracy group of uploading the illegal material themselves.
The group used special software to record the IP-addresses of file swappers, the file name and the server through which the connection was made, and tried to link them to individuals by sending over 2.000 complaints a day to internet service providers. Thousands of Swedish internet users complained to the DPA about this practice. They found the DPA on their side. The group had no right as a private enterprise to collect the information in the first place, the DPA ruled.
The music industry has launched a new wave of lawsuits against individual P2P users in Europe. For the first time individual users were targeted in Finland, Ireland, Iceland and the Netherlands. These countries join Austria, Denmark, France, Germany, Italy and the UK, where litigation started last year.
During a press conference in the Netherlands on 12 April 2005, in the presence of IFPI CEO John Kennedy, the local representative of the entertainment industry Brein announced it would start 32 court cases against individual alleged infringers. In order to obtain the identifying data of the users behind IP-addresses from which music was unlawfully uploaded, Brein will sue five Dutch internet providers (Planet Internet, Het Net, @Home, Wanadoo and Tiscali). These 5 providers had agreed earlier
The MPA (Motion Picture Association) and the IFPI (International Federation of the Phonographic Industry) are pushing for a new collaboration with internet service providers in Europe. The MPA has drafted a 'possible ISP-Film Sector Voluntary Code of Conduct', while the IFPI called for a similar code in relation to the music sector during a conference of European telecom network operators (ETNO).
The industry demands that providers "remove references and links to sites or services that do not respect the copyrights of rights holders". Providers should also collectively adopt new terms and conditions, to 'require subscribers to consent in advance to the disclosure of their identity in response to a reasonable complaint of intellectual property infringement by an established right holder defence organisation or by
During the Wizards of OS conference in Berlin, from 10 to 12 June 2004, legal scientists and civil rights defenders jointly launched a declaration on collectively managed online rights. The declaration is a response to the call for comments on the Communication from the European Commission on the management of copyright and related rights in the internal market - COM(2004) 261. See also EDRI-gram 2.8, 21 April 2004. The declaration states that DRM and mass-prosecution of file-sharers are not acceptable to an open and equitable society and calls on the Commission to consider a music flatrate to ensure compensation without control.
"File-sharing teaches us a lesson that markets and lawmakers should listen to. It says that shipping bits from A to B has become such a low value service that Internet users effortlessly can provide it themselves. This is a result of the communications revolution that the EU has been supporting actively for the last decade. These developments could be good news to the content industries, but not if they are continue to base their business models on a proposition of exclusive service provisions that they no longer hold."
The European Commission warned the 16 different organisations in Europe that collect the royalties on behalf of music-authors that they may be breaking EU competition rules. The collecting societies have closed a pan-European pact in the Santiago agreement, whereby each national organisation functions as the only shop for all European music licenses.
"The structure put in place by the parties to the Santiago agreement results in commercial users being limited in their choice to the monopolistic collecting society established in their own member state," the commission said.
If there was more competition between the societies, both music download providers and users would profit, according to the Commission.
The collecting societies have two and a half months to reply to the Commission's objections. They can also request a hearing at which it would be able to submit their arguments directly to the representatives of the national competition authorities.
The European Commission has issued a Communication on the Management of Copyright and Related Rights. In the period since 1991, 7 Directives have entered into force on copyright law, but none of these specifically addressed the role and functioning of the collecting societies. The Commission now recommends a Community framework instrument regulating the 'establishment and status of collecting societies; their functioning and accountability subject to rules of good governance; as well as their internal and external control, including dispute settlement mechanisms."
The main problem with the collecting societies is the lack of common rules, and the problems for commercial users to obtain a community-wide license. Both users and rightholders have also complained about the tariffs and operating expenses, access to arbitration and general lack of transparency and flexibility.