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Music Rights Management is going to be forced to evolve
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April 21, 2021

Music Rights Management is going to be forced to evolve

At Reprtoir, we are building a digital rights management software, to help record labels and music publishers to deal with their administrative tasks. One of the most important and time consuming being music rights management. Through this accelerated digitalization of the music industry, innovation is taking an important place in rights management. After releasing Royalties Manager, we witnessed many signs that internal tools need to be seriously considered by music professionals. So what are the challenges we face today?

Music rights management is changing

As I’m sure you all know, music rights management has been going through a lot, starting from the CD industry crashing during the domination of Napster in the early 2000. Right now, many music professionals are looking at various revenue streams, relying mainly on digital streaming and virtual performances (in addition to physical sales, records and merchandising, even though it’s way under the level we need to get revenue from it, even with all actions led by Bandcamp).

If you need to get a bit of a reminder of how music royalties work, we just got around making a music royalties breakdown for you on our blog. In addition to that, there’s another topic I’d want to address: the infrastructures dealing with music rights, such as collective rights organizations (including performance rights organizations, mechanical rights organizations…). I’d advise you to take a look at this article if you’re willing to find informations on the different types of actors dealing with royalties.

We’ll get around the various terms and actors at the different stages of the chain between DSPs and artists on our blog. But what I want to highlight here is the mere fact that countries don’t have the same rules (just as the European Court of Justice demonstrated last year), many different actors are working in collaboration on specific aspects of administrative tasks… And errors come up as digital streams of revenue multiply. We’ve even been talking about it in Music Business Worldwide in the beginning of the year: streaming data is becoming impossible to manage.

How to deal with music royalties in 2021?

First things first: are we equipped to deal with these changes? If our infrastructures were created in a context of a well-functioning music industry relying on physical sales, how are we supposed to adapt to brand new digital rights we already struggle with in their current form?

This is a topic that has been addressed lately: how are we supposed to manage digital music rights today? Well, the answer lies in innovation (or MusicTech, if we name the field correctly). Several companies started to develop new ways to manage music rights: independent management entities (IME), after the collective management rights directive adopted by the European Union in 2014 (for details, take a look at the article by Maarten Walraven-Freeling).

The goal is to optimize these music rights management for music professionals and make sure every rights holder gets paid for their work by using more transparent solutions. And it could even involve blockchain. This is a way some IME are exploring today to get through a decentralized network, using information coming directly from a professional entity, and make sure every detail is recorded and accessible to anyone. Of course today blockchain in music evokes more NFT than digital rights management softwares, but it is still worth considering for record labels and music publishers.

Why does it concern any music professional?

It concerns music professionals, especially record labels and music publishers, essentially because the weight of all this administrative management and anticipation will fall on them. I know I don’t need to remind you that anyone building a company in the music industry is at the service of artists, the very core of our field. Remunerating artists is the most important action we are dealing with.

Realizing that our infrastructures are not suited for the current digital transformation the music industry is undertaking is the first step. Now, it is a matter of adapting. It does rely on you, labels and publishers, too, independent or not. It’s also our responsibility to build reliable digital rights management softwares, such as Reprtoir software suites to back up your data, optimize tasks and make sure no mistakes are made. Let us know what you think and what you could need from us!

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