Worldwide royalty collections for creators of music, audiovisual, visual arts, drama, and literature reached a record €9.65 billion (CAD$14.08 billion) in 2018, according to the 2019 Global Collections Report published by CISAC (International Confederation of Societies of Authors and Composers).
CISAC is a global network of authors’ societies, with 232 member societies, including SOCAN, in 120 countries.
Globally, royalties from digital sources jumped 29% to €1.64 billion (CAD$2.39 billion), thanks to rapid global expansion of music and subscription video on-demand (SVOD) services. In the last five years, creators’ digital income has nearly tripled, now accounting for 17% of collections compared to 7.5% in 2014, according to CISAC.
In Canada specifically, the big-picture numbers look strong, but in terms of who has getting the money, it’s very top-heavy with the average payout to SOCAN members from digital collections being only $54.
“Canada had another strong year in 2018, mostly thanks to a good performance from the music repertoire, which accounts for 99.8% of total collections. Collections were up 3.9% year-on-year at CAD$364 million, with digital revenue up 23.6% over 2017,” the report says. “The growth in digital was driven by the adoption of streaming services, and increased licensing of services. However, rights society SOCAN says that while digital sources accounted for 29% of SOCAN's income, more should be done to ensure that all rights holders receive a more equitable share of digital revenues.”
The CISAC report also says that in Canada, while music revenue is seeing growth overall, there were revenue declines in TV and radio (-1.0%), private copying (-69.2%), synchronization (-19.3%), and reprography (-7.6%). CISAC says the declines are the result of falling advertising revenue for radio and TV markets as consumer move away from traditional broadcasters in favour of streaming. Despite that, broadcasters still account for 53.8% of total collections.
Also in the report’s section focused on Canada, it notes that mechanical rights society CMRRA, which is owned by US rights society SoundExchange, took in 9% more revenue in 2018 compared to 2017 thanks to increases in digital, TV, and radio, which compensated for the drop
in mechanical rights from CDs and videos.
In terms of how Canada ranks globally, it’s ninth in the world in collections for all repertoires together with a 2.5% global share, but places seventh in the world in music collections with a 2.8% of the global share. Interestingly, Canada places fifth in the world in terms of its percentage share accounted for in digital music at 30.9%.
The increase in major markets’ digital collections - notably the United States, France, and Japan - are the biggest drivers of global growth. This growth is helped by new and extended licensing deals between societies and digital platforms, from dedicated content services like Spotify to social media platforms such as Facebook and video-on-demand platforms such as Netflix and Amazon Video.
Global collections for music repertoire, accounting for the majority of the total, rose 1.8% to €8.5 billion, driven by a 29.6% growth in digital income and the continuing surge in subscription streaming revenues.
Total collections up 1% in 2018
Total collections in 2018, for all repertoires, grew 0.9%, the fifth consecutive year of growth. Over the five years since 2014, global collections by CISAC societies are up 25.4%. Digital growth, combined with resilience in the two other major uses (TV/radio and live/background), are continuing to offset declining income from physical media.
TV and radio, the largest collections source, declined 2.4% in 2018, while live and background revenue grew 0.5%. Combined, these two sectors have substantially grown since 2014, adding €653 million in revenue.
CISAC Director General Gadi Oron said: “This Report provides many reasons for optimism about our sector. Digital revenues show an impressive increase, have nearly tripled in the last five years and have enormous potential for further growth. More markets are seeing digital income taking the top position of all revenue streams, which is an extremely positive sign. In a landscape of fragmenting income sources, the role of authors societies in generating monetary value for millions of creators has never been more vital.”
Digital shows its growth potential
The Report shows other key indicators of the shift to digital: Asia-Pacific is a digital leader, with an online share of 26.3%, twice that of Europe at 13.3%; and Australasia, Sweden, South Korea, Mexico and China are in a growing group of “digital champions” where online revenues are now the top collections source.
However, the Report also highlights the need for legislative action to bring fair creators’ remuneration, calling on governments to follow the example of the landmark EU Copyright Directive, adopted in April 2019.
Jean-Michel Jarre, CISAC President, said: “Digital is our future and revenues to creators are rising fast, but there is a dark side to digital, and it is caused by a fundamental flaw in the legal environment that continues to devalue creators and their works. That is why the European Copyright Directive is so momentous for creators everywhere. The Directive has sent an amazing, positive signal around the world, building a fairer balance between creators and the tech platforms”.
For more information and to download the report, go to www.cisac.org.