Universal Music Publishing Group and Sony BMG Music Entertainment have entered into an unprecedented deal regarding digital royalties for the publisher in Southeast Asia and India.
“For many years, digital music resellers have been challenged with licensing content from a myriad of content owners and similarly challenged in effectively reporting sales in return,” says Ruuben van den Heuvel, Sony BMG’s senior VP of digital and new business development in Asia.
“We expect to see a significant increase in our respective businesses,” adds van den Heuvel, “as content flows to our partners and consumers are able to find their favorite artists and discover new music to get excited about.”
The new agreement is expected to streamline licensing for the use of music and music video, speed up the development of the legitimate online and mobile markets, and ensure that rights holders — including artists, songwriters, record companies, music publishers, and collection societies — will benefit from Asia’s position as a leader in developing new models for music on digital devices. The arrangement creates a new precedent in India where for the first time record companies have agreed to pay mechanical royalties to songwriters and publishers on the sale of records.
“This multi-lateral deal should enable the legitimate digital business in the region to operate with certainty,” says Andrew Jenkins, UMPG executive VP of international. “Through the combined efforts of UMPG and Sony BMG, and our common line of action with this agreement, we are providing a digital model for the whole industry to adopt.”
The significance of the deal is expected to be discussed today at MIDEM during a panel presentation, organized by the International Confederation of Music Publishers, on emerging publishing markets. Jenkins and van den Heuvel will be on the panel.
The agreement covers all digital uses of compositions except monphonic and polyphonic ringtones, karaoke and non-interactive webcasting. They include audio and video downloads, streaming and subscriptions services; mobile products including master ringtones, ringback tones, full-track downloads and mobile video.
For the Southeast Asian countries, the companies agreed to a specific, undisclosed rate that… digital services in Asian countries where no rates have ever been set before. The countries are Hong Kong, China, India, Malaysia, Singapore, Taiwan, Philippines, Indonesia, Thailand, Macao, Pakistan, Viet Nam and Burma. Deals for Japan and Korea are already in place.
“The future of the music business requires simplification, immediacy and effectiveness and this deal leads the way on every count, says Kelvin Wadsworth, Sony BMG president, Asian region.
UMPG and Sony BMG will work together with the performing rights society in each territory to implement this agreement for the benefit of authors, artists and other rights owners, digital service providers and consumers. The arrangement is expected to provide clarity regarding licensing procedure in many countries of the region for the first time, and will support the efforts of those organizations who want to provide legitimate digital music services.
“UMPG is pleased to be facilitating the legitimate digital licensing of our repertoire in SE Asia and developing new revenue streams for our songwriters in that region,” added David Renzer, Chairman & CEO, Universal Music Publishing Group.
The companies say they are inviting all of the relevant rights societies to join in their efforts to provide simple and effective licensing models throughout the region.
