Russian Collecting Society Director Explains Reform Plans Amid Widespread Criticism

Courtesy Photo
Sergei Fedotov

Russian Authors' Society (RAO), the country's sole state-approved authors’ rights collecting society, is in the process of major reforms, all aimed at stepping up the organization's transparency and efficiency.

"To improve the situation with authors' fees collection, we need to make order inside our organization first," RAO's general director Sergei Fedotov tells Billboard in a visit to the collecting society's office in Moscow.

As part of a reform scheme, RAO has created three working groups. One will deal with paperwork and organizational procedures to ensure companies can register with RAO alongside individual rights holders -- a major issue, according to Fedotov. Another group is to be in charge of upgrading the IT system to provide more information and services to rights holders online. A third has been established around an upcoming conference, the details of which remain scant.

"We are not starting from scratch," say Fedotov, referencing the organization's tech infrastructure. "Our existing IT scheme was praised on an international level by visiting representatives of the British collecting society PRS. We just need to upgrade it."

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Over the last few months, RAO has faced substantial criticism in the media and from governmental agencies, with insufficient transparency being one of the main accusations. The critical wave started after RAO and the country's two other major collecting societies -- VOIS, which deals with neighboring rights, and RSP, which collects a one-percent tax on imports of electronic devices that can be used for copying content -- announced consolidation plans this past summer. Although Fedotov still stands by the idea, he admits that specifics have to be reconsidered.

"The idea of consolidation into a single legal entity has been deemed unworkable," he says. "If that idea were implemented, conflict of interest would be unavoidable." According to Fedotov, a more viable model of consolidation would be a professional association or union that would coordinate collecting societies' operations and work out professional guidelines. "In addition, it would provide additional public control over collective societies," he says, adding that other consolidation models that have been suggested following the announcement, including putting a government agency in charge of authors' fees collection, could only lead to a collapse of the existing collecting system.

While admitting that RAO is in need of reform, Fedotov shrugs off some of the accusations of insufficient transparency.

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"The vast majority of rights holders insist that they wouldn't want the size of authors' rights fees paid to them to be disclosed," he says. "And, under the personal data law, we cannot disclose that information anyway."

Still, Fedotov says that the organization is determined to step up transparency, and rights holders will have access to more information online, while more detailed reports about RAO's expenses will be publicized. Fedotov says a number of factors, including a controversial "global license" idea, some rights holders' claims that they are underpaid and the recent consolidation announcement, have led to hostility towards the organization, and RAO is now working on resolving outstanding issues.

The "global license" idea, first floated in 2014, stipulated an annual fee that every internet user would pay which would cover the expesnse of all copyrighted videos, music and books they download, view or listen to online, with proceeds being divided between rights holders. "Unfortunately, we proposed the idea first and only then began discussing it with interested parties," Fedotov says, adding that the idea antagonized many because it is "revolutionary" and that in some form it still needs to be implemented to serve rights holders' interests.

"It is important to understand the role of telecom companies," he says. "Also, instruments for monitoring downloads and views need to be created. Before it is done, further discussion of the idea makes no sense."

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As for the size of rights holders' payments, Fedotov says it is vital to achieve balance between what rights holders would like to be paid and what companies can actually pay, given the unfavorable economic conditions. "This year, the total amount of copyright fees collected by RAO is to go up, in spite of the overall economic downturn," he says. "As the authors' fees collection market in Russia is still in its formative stages, we keep discovering new payers."

When it comes to copyright protection, things have certainly improved in recent years, but are still far from being rosy, according to Fedotov.

"The existing legislation allows large and rich rights holders, such as the biggest labels and film companies, to stand up for their rights," he said, adding that the situation for individual rights holders hasn't improved that much.

As RAO follows the path of reform, the organization would also like to step up international cooperation and facilitate cultural exchange between authors from various countries.

"Back in the early 1990s, there was a project called "Music Speaks Louder Than Words," in which -- Soviet and US composers and lyricists were paired up to write songs," Fedotov said. "We'd like to try something like that in Europe as part of integration and improving mutual understanding."