by : Business, May 2012

IMR’s Scoping Report

IMR’s Scoping Report

At the end of February, WIPO and its International Music Registry group (IMR) released a long-awaited “Study on the Role and Functions of the International Music Registry.” The MBJ has been covering the subject since December 2011, and last month we reported on a parallel initiative—the EU’s Global Repertoire Database.

The study’s author is Nicholas Garnett, now principal consultant with Interight. com.i Garnett is an intellectual property and information technology specialist with extensive international experience in the management and protection of intellectual property rights. He worked extensively with research and deployment of digital rights management (DRM) systems, as well as serving as Director General and CEO of the International Federation of Phonographic Industries (IFPI) from 1992 to 1999.

In this article we will report on the main points of IMR’s study. Its coverage includes (i) a comprehensive explanation of the various current and planned global initiatives in the field of music rights databases; (ii) a description of the necessities of rights management infrastructure in the current digital environment; and (iii) a proposal of functions and roles for WIPO and the IMR to support infrastructure developments to match the music industry needs on a global basis.

Rationale

The Internet is widening the global access to entertainment services and products, but an intricate system of rights, complex licensing models, and constantly changing and fragmented ownerships of rights make it extremely burdensome for rights users, who want to create services and products that require the authorization of a vast list of copyright owners. According to the study “there exists at this time no globally integrated system of rights management information for any of the three subject matters of copyright or neighboring rights protection in music: musical works, performances and sound recordings.” In a world where access for music is ubiquitous, illegal services prospered offering and circulating music for free because they did not have to bother with licensing the content. For legal alternatives to prosper, it is paramount that rights users have access to information on who owns what and where in order to obtain proper licenses.

In the traditional structure of the music industry, an RMO is a rights management organization: “an entity which has a role in administering rights in copyright work, whether as the owner of such rights or in some other capacity, such as the agent for the rights owner.” RMO’s typically enjoyed a monopoly power in local markets, offering licenses on behalf of the rights holders. The system offered standardized business models and licensing practices and the RMOs could decide which sorts of data were irrelevant for collection and processing. However, with the shift in the industry came a shift in the paradigm of rights management. With new nonlinear and complex structures – and sizeable global markets at stake – the RMO’s standard data-collection procedures seem to be less practical.

If on one hand technology is presenting challenges for the industry, on the other it is also offering new opportunities to support the increase in the overall demand for licensing. Metadata systems, fingerprinting and watermarking technologies, DRM systems, messaging protocol standards, and cloud-based systems are all examples of technological improvements that are essential to promote effective licensing structures and a global rationalization of rights management systems.

Interactions and Formalities

Understanding the core functions of rights management organizations in a manner that isolates the common denominators found among different kinds of licensing systems is an essential step to narrow the scope for the international registry initiative.

The nine core functions of the RMO’s were separated into three interactions called “rights holders,” “rights users,” and “internal.” All interconnect. For rights holders, the study illustrates issues involving the registration of works and participants, as well as the distribution of revenue. For rights users, the study examines the look up, licensing, and reporting operations. At an internal level, the study isolates dispute resolution and international reconciliation of music data.

Analyzing how these functions are performed across the globe, the study observes that for the most part there is a lot of repetition in the process: standardization and automation would be very helpful. Also, the way these functions are performed differently across territories has a direct impact on how music services are developed: some markets are excluded from accessing music services because the threat of statutory damages for unauthorized use is high and makes the development of a new service prohibitive. Better access to the relevant rights management information, i.e. easier look up terms for rights users, have a direct effect on revenue generation and the promotion of licensed services. In this regard, the identification with current technology of all the rights holders of a musical work would bring, it is argued, public awareness and access to that work and stop it from being the purvey of a few.

One important point noted in the scoping study is the prohibition of formalities for copyright protection. The Berne Convention established that no formal process should be required to guarantee copyright protection of a work. For instance, to secure a copyright in the US it is just necessary for a creative work to be original and fixed in a tangible form. Many countries have established voluntary registration systems for copyright in order to clearly establish authorship and ownership of rights. Garnett points out that the impact of digital technology and the internet are challenging the status quo, suggesting the need for revi- sion of the legal position of registration, as copyright may become meaningless without it.

Other Initiatives

When analyzing the ongoing and planned initiatives around the world, the WIPO study highlights that there is no single initiative that focuses on all the rights related to music at once, i.e. the copyright of the musical work, the separate right to its sound recording, and the claim over performance and neighboring rights.

As for the copyright of the musical work, it focuses extensively on the EU Global Repertoire Database (GRD) initiative, as it seems it is the one with most reach and potential so far.ii The study also lists the WIPOCOS and the West African Network Project as an example of a regional effort for a database and data exchange system, similar to others already in place in Latin America and Asia.

Regarding sound recording rights, the study refers to the ISRC identifier system, from the IFPI and currently the standard for sound recording registration that will soon need to be revised and updated. In neighboring rights the VRDB+ appears to be the reference application used for the identification of participating artists in sound recordings and audio-visual works.

Mr. Garrett carefully wrote the study to emphasize that the proposed IMR is not an initiative that is meant to overlap the efforts of these other initiatives, but to collaborate and serve as a registry of registries, in order to unify in a single place all the information necessary of a music work, ensuring interoperability and integration of the various systems.

The Context

WIPO sees a role as something similar to what was already created for patents and trademarks. As the music industry, especially in developed countries, is not yet convinced and even hostile of any direct involvement in the development of rights management information systems, the study emphasizes that WIPO’s involvement should avoid interfering with other industry initiatives. Instead it aims to support and enhance the potential of globalization by facilitating interaction between all the different stakeholders. One point of main concern for WIPO is to offer support for emerging countries such as the BRICS (Brazil, Russia, India, China, and South Africa). Also, WIPO sees its role as offering support for dispute resolution over intellectual property as one of its most distinctive and proven skills.

Theneedforgloballyintegratedrights management systems may be clear for many who would argue that benefits would accrue to rights holders, rights users, and many other music inter- mediaries. Still, it is not evident at this point that there is complete industry buy-in. The declining fortunes of traditional revenues, such as royalties for sound recordings, together with the emergence of new media and buying power in countries peripheral to the metropolitan economies, should at least encourage forward thinking and possibly compromise across stakeholders’ lines.

By Luiz Augusto Buff

 

Endnotes

i. http://www.internationalmusicregistry.org/export/sites/imr/ portal/en/pdf/imr_scoping_study.pdfii.

ii. See Peter Alhadeff, “Waiting for GRD”, The Music Business Journal, Mar. 2012 http://www.thembj.org/2012/03/waiting-for- grd/.

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