This time last year, proposed anti-piracy legislation Stop Online Piracy Act (SOPA) and its Senate counterpart the Protect IP Act (PIPA), drew fierce criticism and protests in the U.S. What impact did that have on the wider global issue of introducing anti-piracy legislation?
It certainly wasn't helpful. What became very clear [was that] governments and politicians who had to be re-elected kept their head down or took [a certain] position. Now they are saying to us: "We're wondering, in actual fact, if we were frightened and rushed in to it." There was this massive push that blinded everyone. It wasn't a rational debate. It was very, emotive, very manufactured and because of that reasonable dialogue was not possible. Because of that there has been a drop-off in discussion with regards to enforcement.
In regards to fighting piracy in the U.S. market, Kim Dotcom and Megaupload dominated the headlines in 2012. What's IFPI's stance on Dotcom's new cloud storage and file-sharing site Mega?
Obviously, Megaupload is down and we would like to see it stay down. We are looking at the new service. We can't make comments yet because one has to investigate that service. But as far as we are aware, none of our companies have been approached for licenses, so we could have a problem there.
Collective licensing income – performance rights, broadcast rights, etc. – now makes up approximately 6% of global industry revenues. As the music business expands into new and emerging markets, what progress is being made in negotiating rights in country's long resistant to the notion?
In Singapore in December, we managed to get performance and broadcasting rights, which we didn't have before. We're now pushing for that in China. Proposals are on the table and are on their third reading. We are hoping that by the end of this year we will have very good news that China has moved towards introducing public performance and broadcasting rights. China is currently the 27th largest market [according to IFPI's 2012 Recording Industry in Numbers report], but we'd like to see it become one of the top markets. We're also looking at Russia very carefully. Russia is the 23rd [largest] market and it should be in the top ten. And then there are other markets like India and Brazil, which are doing particularly well. We're talking to the EU at present to try to get the [performance] rights that exist in Europe to be introduced in Japan. As Max Hole [chairman and CEO of Universal Music Group International] said recently, it used to be that we get 80% of our income from 20% of our markets. That's changed. It really is a global environment now.
Speaking at this year's MIDEM, Beggars Group founder/CEO Martin Mills called for greater political support for rights industries. Do you agree?
What we would say is, it's great that you laud the music industry as special. But we have been left, to some degree, to fend for ourselves and try to save the industry against rampant piracy. We believe that we're turning the corner, but at the same time there are so many things that governments could do to help. They could help us to enforce our rights better, instead of us having to plough through the courts. We are looking to begin voluntary measures regarding advertisers and payment systems [on illegal sites]. But, of course, if you don't get the support you are looking for, governments could help to put on pressure there. In the area of copyright reform, we need governments to recognize that it's a question of whether we need them to legislate. We believe that the legislation that's there at present is good – but we need them to recognize the value of copyright and stand up for it.
Now that the industry is showing strong signs of recovery, does it almost become a catch-22 type situation, where the prospect of stronger political support recedes and self-regulation, once again, governs?
Well, they didn't give us the support necessarily when we were saying: "We're not waving. We're drowning." We were very, very vocal about the state that the industry was in a couple of years ago. We made that clear to politicians and with some of them we got legislation tabled. Some governments very often talked a good game, but didn't necessarily deliver, or the delivery was something far too long-term. From that point of view, a lot of the climbing back out of the hole we have had to do ourselves. I think we're getting to a stage now where, hopefully, governments are aware of the importance of the creative industries. Strangely enough, over the last 5 years or so, when economies have been doing really badly, many [politicians] have been saying that it's the creative industries that are going to save them. That's the irony of it. Now they're drowning, there's the suggestion that we are the ones that can save them.