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Pan-European Licensing or Push-Me-Pull-You?

Last week the UK’s Performing Rights Society (PRS) succeeded in stopping their Dutch counterpart, Buma, from issuing unauthorised pan-European licenses for online music. Could this be a sign of the classic one-step-forward, two-steps-backward situation for the pan-European licensing initiative?

According to an article on Digital Music News, the Dutch licensing organisation BUMA implemented a pan-European rights package for an online store called Beatport, back in July 2008. However it appears they may have been premature in claiming that it covers worldwide repertoire even on works that belonged to other societies, (e.g. the portfolio included assets managed by the British Performing Rights Society (PRS)), and they got sued as a result – which makes a change from suing consumers!

On the surface, pan-European licensing simply makes good sense as it should greatly reduce the headache associated with collecting / reconciling royalties between the member states, and the European Commission has championed this by mandating a pan-European licensing system. Unfortunately, the various societies seem to be in direct competition with each other when it comes to administering works outside of their own particular territories hence this situation. According to a press release on the PRS website, this “important decision confirmed that collection societies cannot issue licences without the consent of rights holders and will ensure that the rights of all songwriters and music publishers will be fairly upheld throughout Europe.” It went further to state that this ruling confirms that “no society can issue licences without the express agreement of the other”.

This is all well and good so far, until we consider the fact that just last month the European Commission was still pushing for the removal of all impediments to the pan-European licensing system, including such “territorial restrictions that prevent a collecting society from offering licences to commercial users outside their domestic territory” (see Billboard’s Industry News coverage of the same story). Now far be it for me to question the intentions of any royalty collecting society, but surely if progress lies in a pan-European, or global, reciprocal licensing system, (as opposed to the country-by-country, society-based competitive mish-mash we currently have), then who stands to gain the most by keeping this current system in play? Answers please anyone?

Blog Awards Note. This blog was voted runner up in the recent ComputerWeekly Blog Awards 08 (under the Web2.0 and business blogs category). Congrats to the category winner, TechCrunch UK, and my sincere thanks to all those who voted for me. Next time it will be gold. Promise.

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