He has market power, and he’s using it to win better rates in an increasingly digital world
Martin Bandier has been in music publishing for more than 30 years and leads the world’s largest catalog holder, so when he describes the last year as “probably the most interesting year in my business life in publishing,” it’s a good idea to pay attention.
Bandier, a lawyer by training and a music man by choice, is referring to the unfolding legal ramifications around the move by publishers—which he led—to pull digital rights for songs from collection societies ASCAP and BMI in order to negotiate directly with digital services like Pandora and iTunes Radio for higher rates.
Bandier’s plan, embraced by some of his fellow publishers, appeared to work quite well until rate court judges for ASCAP and BMI handed down separate rulings saying the publishers can’t pull just their digital rights—they have to be all in or all out. While the ASCAP judge disallowed the withdrawals, saying the publishers were all in, the BMI judge said the digital withdrawals meant they were all out.
The BMI ruling came in mid-December. “It was the first holiday period I had been so busy,” Bandier says. “My biggest concern since day one of withdrawing our digital rights is we wanted a fair price, that the words and music were equally as important as the recording. The only way to achieve parity was to withdraw our rights and to seek arms-length deals with the digital partners. Performance revenue has become a more important revenue source for publishers as sales decline.”
Bandier has market dominance—his company’s share soared to 33% after he engineered Sony/ATV becoming the administrator for EMI’s publishing catalog in 2012. It would have been easy to sit back and enjoy it. Instead, he wants to use the company’s market power to benefit songwriters and one day soon to get paid at a rate similar to performers.
“My job is to maximize value for our owners and our songwriters. It’s not the superstar writers I worry about the most, it’s really the writer with one or two hits that needs to meet his monthly mortgage.”