And, on the floor of the House of Commons, I spoke up for my talented constituent Laura White, to my knowledge the first person to play a musical instrument on X Factor, being unfairly voted off.
So it must be reassuring for you all to have an intellectual heavyweight intervening in the big music issues of the day at the heart of government.
But, the truth is, government intervention in the music business does not have a glorious history. To paraphrase one of our greats, mixing pop and politics is not a straightforward business and, indeed, can be a bit embarrassing for all concerned.
The British music business has been a major success story with government at arm’s length, or further – in something of a state of mutual distrust.
Over the second half of the last century the industry grew into one of real economic and cultural significance – and its output for many defined us internationally - yet without significant government intervention or political help.
Indeed, I would argue that some of the best music this country has ever produced came out of my home region, a depressed North West in the 1980s and 1990s, as a statement of defiance to the government of the day.
This music was the soundtrack to my political formative years – and yet disturbingly I find that at least half of today’s Shadow Cabinet claims to like the same stuff.
I used to have an album by a band called the Redskins - Neither Washington nor Moscow - which one of my shadow MPs, Ed Vaizey, claims to have liked too.
I got really worried when David Cameron said he liked The Smiths and other bands of the time, saying ‘I don’t see why the Left should be the only ones to listen to protest songs.’
But he blew his cover when talking about the Jam’s Eton Rifles – saying ‘It meant a lot, I was one, in the corps.’
It took my colleague Ian Austin to point out that it wasn’t a supporters’ club anthem for Mr Cameron’s old school.
But, to be fair, we’ve not had our good moments. Everyone remembers Noel Gallagher at No 10, and John Prescott’s run-in with Chumbawumba, and I think ever since we’ve kept a polite distance.
So, as I say, no glorious history of pop and politics.
But I’m going to make the case this morning that necessity means that the old order of things needs to change.
The time has clearly arrived when pop needs a bit of political help, when we are all having more meetings and conversations than we’ve had in the past.
Music has been hit hard over the last ten years, and if we don’t do something there is a real danger that parts of the music industry will be washed away.
Developments in communications have changed the music world and I think we are now at a time that calls for partnership between Government and the music business as a whole: one with rewards for both of us; one with rewards for society as a whole.
Music has been a life’s passion for me. When I came into this job earlier this year, I made it a personal priority to focus on the music business – and, hopefully, identify solutions and new models to sustain this cultural strength throughout this century as it was in the second half of the last.
So, the Government signalled this change of gear in February with the publication of our Creative Britain strategy – the first proper programme of structural support from government for the creative industries: moving from the margins of government thinking to the mainstream. We said clearly that legislation would be brought forward to tackle illegal downloading if acceptable voluntary solutions did not emerge - and that remains our unequivocal position.
It’s more important than ever at this particular time when there’s pressure in the economy that we acknowledge and encourage the catalytic role that the creative industries can have in this country. Our traditional creative strength is an enormous competitive advantage in a changing and highly connected world.
International solutions are needed and that’s why one of the things that came out of the strategy was a commitment to establishing a new network to bring together internationally renowned talent from the creative industries – the Creativity and Business International Network. The aim, in time, is for this forum - c&binet - to become an annual event in Britain that’s seen as the equivalent of “Davos” for the creative industries.
But it’s not just on the government side that there has been a change of gear. The industry has clearly been getting its act together off the stage.
The formation of UK Music is a welcome step, as is the Featured Artists Coalition. I don’t think we could ever expect the music industry to speak with one voice – so two isn’t bad – but it does bring a lot more coherence and makes my job easier when representing you to the rest of Government. I recognise the progress made and welcome it.
This is needed now more than ever as it has been a tough few years for the music industry – and a particularly tough few weeks. This year particularly has seen a real acceleration in the breakdown of the traditional systems that fund creativity – the systems that have been in place for decades, particularly in TV and music.
The worldwide economic downturn is adding to the pressure. But it also creates the conditions to allow fresh thinking and help it to take root. Fresh thinking is needed to rework the old models where people handed over their money in the record shop and it found its way into various pockets throughout the industry.
The music industry did very well out of my generation, both the talent and the paying punters. Buying an album was a serious long-term strategic investment of pocket money after weeks of studying the NME and the indie music charts. It was such a commitment, even when you got it home and realised it wasn’t quite as good as you hoped, you had to defend it vigorously.
The online revolution has changed all the rules and ever since we’ve been struggling to catch up. For creative talent like you, it’s a genuinely double-edged sword – liberating and democratising on the one side, allowing people to bypass the traditional gatekeepers to the creative system.
But on the other side, what the online revolution has done is promote a prevailing sense with the online generation that creativity is free to enjoy.
We enjoy a whole lot more choice and opportunity – which is good. And a lot of people enjoy all that for free – which is good for them but not for everyone –and not good for the long term prospects for new music and new ideas, and fresh talent coming through.
So music has been hampered by a real sense of ambivalence towards the internet from the off. But some of its early ideology, in my view, was detrimental to its interests.
There was a powerful undercurrent at the start of the internet that was expressed in the Declaration of the Independence of Cyberspace written by John Perry Barlow in 1996.
‘Your legal concepts of property, expression, identity, movement and context do not apply to us.’
But the legal concept of copyright has underpinned our creative industries for decades, and is essential to rewarding talent and creativity.
We are now having to confront these notions – but we need to respond in a way that doesn’t criminalise a whole generation that has come to enjoy and explore creativity in a different way.
We need new rules and new norms and they have to be agreed on an international basis because that’s the way the online world operates.
My job – Government’s job – is to preserve the value in the system. Your challenge as an industry is to devise a system that is fair to the paying public and to the performer. Making it stick might mean industry and performers agreeing new rules and new models. But any long-term solution will have a greater chance of sticking in the long term if bodies like the FAC can recommend them unequivocally to their fan base.
It may not be the first thing on Barack Obama’s mind – but it is in there as part of his cultural and creative agenda and we do have a fresh opportunity to come to a common understanding with a new administration.
Illegal file sharing comes under that banner, and I personally think we are breaking new ground in this country.
The gap between how many tracks get paid for and how many don’t is just staggering – and I think the voluntary agreements to change that are going as well as could have been expected at this moment in time.
ISPs are talking to music companies about this. Something they weren’t doing a year ago. And they are writing letters to illegal downloaders – which they weren’t a year ago.
We’ll have some idea of how effective that has been early in the new year and it’s important that the Memorandum of Understanding that we’re working on with ISPs and music rights holders doesn’t slip.
The voluntary approach is obviously the best way forward, but we’re working on how legislation could underpin the voluntary process if necessary in a way that’s fair and proportionate. Having come this far, I’m determined that we bring this issue to a conclusion that works.
Copyright underpins the music business – and all our creative industries – and the right response when it’s put under pressure is not to abandon a system as outdated, but to make it work better.
There is a moral case for performers benefiting from their work throughout their entire lifetime.
That is why I have been working with John Denham, my opposite number in the Department for Innovation, Universities and Skills, to consider the arguments for an extension of copyright term for performers from the current 50 years. An extension to match more closely a performer’s expected lifetime, perhaps something like 70 years, for example, given that most people make their best work in their 20s and 30s.
And we must ensure that any extension delivers maximum benefit to performers and musicians. That’s the test of any model as we go forward.
It’s only right that someone who created or contributed to something of real value gets to benefit for the full course of their life.
There’s another moral argument that says you should have a right not to have something you’ve created being associated with a cause or a brand you’re not comfortable with.
From a cultural point of view, it’s right that Government should be recognising and celebrating the role that performers and creators play in the cultural life of the country.
And from an economic point of view, the music business is one of our most significant creative industries – and the creative industries as a whole are the right direction to be pushing our economy at this moment in time.
Let me be absolutely clear so there are no misconceptions about where the Government is on this. I have been working closely with John Denham, and we both share a real support for artists and musicians.
We want the industry to come back with good, workable ideas as to how a proposal on copyright extension might be framed that directly and predominantly benefits performers – both session and featured musicians.
I’d like to congratulate Charlie McCreevy for initially instigating this discussion.
I think you have heard already from Charlie on his proposals at the European level and we’ll be working with him to find the right approach through copyright that rewards creators and performers, including session musicians.
But all of this is meaningless unless we lay down the foundations in creative education for young people, helping them to feel confident in their creativity.
Support for talent goes to the heart of the Department for Culture. It starts with helping more young people discover their creativity from an early age.
And it’s also important that industry invests back into the system to benefit the next generation - as we have seen with the Premier League do in football.
Here’s an example: we’ve worked with Fergal when he was heading the Live Music Forum, developing the idea of rehearsal spaces in deprived areas around the country – places where aspiring musicians or technicians can practice and gain experience. Places that can develop into music hubs for the community, with links to the live music scene, community radio and the music industry locally and nationally. The first of these should be starting up in the New Year in Liverpool, Bristol and Manchester.
We’re putting in £500,000 and we’ve got commitments of support from across the music industry – but it needs the support of musicians and performers as well to make it work.
Another example about how industry can put back in to the system: we’ve set a goal for 5,000 new apprenticeships in the creative industries every year to give young people a clear career path into jobs in the music business, TV, film and so on. Not everyone gets an equal chance to break into the music business, for one way or another.
Apprenticeships are a way of finding and nurturing talent that might not otherwise get discovered. Government can set the ambition, but we can’t offer the jobs – that’s down to industry, and I’m delighted with the interest that EMI and Universal have shown so far to host music industry apprenticeships.
Another example: we’ve launched a programme in schools called Find Your Talent, as part of the commitment to give every young person five hours a week of high-quality culture and art.
The idea rests on getting professional creative people much more involved with local schools and with cultural activities with young people outside school. Using the power and the glamour associated with proven creative talent to inspire an interest in culture and creativity – particularly in those that either haven’t had the chances in the past.
This is, of course Department for Children, Schools and Families’ territory as well. They are putting over £300 million into funding music in schools over the next three years including the priority for free musical tuition for all primary school pupils. Already, it’s amazing to hear that the number of children learning an instrument looks set to have doubled over the last three years, from 22% in September 2005 to some 50% in September 2008.
It’s through partnerships like these that we’ll bring on the next generation of talent, and which will start to change people’s perceptions of the value of creativity.
The online world has smashed the old models apart and opened up new opportunities for us to rebuild an industry that stands the test of time.
It has cut out the middle men. But we still need to think through all the consequences of that – what the new models are and how they work.
How do we replace the essential functions that the old middle men used to perform – the promotion, contract negotiations, the protection of rights, of ownership, paying taxes?
How do we help people lift themselves up above the noise? How do we help them to protect their rights?
We need to make sure we are not just discovering the new talent of the future, but also preparing that new talent for the world as it is now.
The big creative challenge now is to come up with the new ideas that keep people listening and which set a true and realistic value on talent. In short, we need to create a new business model that is fairer to everyone – music-buying public, performers, and those who have built up the industry.
Thank you.
Charlie McCreevy said:
Ladies and Gentlemen,
It is well known that there is no place I like better than to be among innovators, entrepreneurs and business people. I usually address people involved in the more main stream industries - manufacturers of goods and suppliers of services. And while the entertainment business is far more glamorous than manufacturing widgets, at the end of the day it's all about making a living and being paid for your creativity and innovation. So it is a great pleasure for me to be here this morning to speak to such an illustrious group of artists and creators. And I would like to take this opportunity to explain why I, the Commissioner for the Internal Market - usually associated with big banks and other large financial industries - launched a proposal to obtain 'a better deal for performers'.
First and foremost, I consider copyright and the music industry to be just as important as any other part of my portfolio - not only in terms of the economic and cultural benefits it brings to the European Union, but perhaps even more importantly because of the entertainment and feel good factor music brings to our daily lives.
As I said when I launched this proposal last February, very few people who listen to music can tell you who wrote the music or the words of a song. What they can tell you is who made it a hit. And while I have no doubt that all of you know it was Maria McKee who penned "A Good Heart" which went to number in several countries, all I know is that it was Feargal Sharkey here who sang it. So you have to ask the question why should authors make money from their work for life plus 70 years, and the performer, who brings that work to life, only receive payment for his or her work for 50 years?
Europe has harmonised copyright. And if it should be changed to give performers a better deal, Europe has to change it. As you are all aware, the Commission proposal, presented in July 2008, seeks to extend the term of protection of performers and record producers to 95 years. At present, the term of protection is for 50 years, which is low by international comparison. The US protects sound recordings for 95 years, Mexico for 75 years, Australia, Brazil and Turkey for 70 years.
This raises several questions.
Why doesn't Europe value its music recordings as highly as others do theirs?
Why should a young performer have to invest in developing his or her talent with the knowledge that he or she will probably lose protection before the end of his life?
Does Europe want to signal to performers that they are more valued overseas?
The answers are obvious.
Apart from term extension, the proposal also aims to give performers a better deal. There are several features in the proposal that highlight this:
Because session players never get any right to participate in offline and online sales revenue, the proposal provides for an additional remuneration claim for session musicians. That claim, also known as the 'fund' is applicable to all sales - offline and online - that occur in the extended term. This additional remuneration claim would compensate session musicians for the transfer of their copyrights when they sign their recording contract.
This is 'a better deal for performers'.
In addition, many performers often stand by helplessly while their recording is wallowing in the 'deep vaults' of a record label which is unwilling to market it. That is why we favour a 'use-it-or-lose it' clause. That means that a performer can claim back his copyright if his producer does not market his sound recording in the extended term.
This is another component in the 'better deal for performers'.
But we have not forgotten those featured performers who have been promised a royalty and never get it because of a host of deductions applied by the record label. According to the 'clean slate' provision, which the European Parliament wants to introduce, and which we in the Commission favour as well, featured artists, in the extended term, will get to keep their royalty income unencumbered by deductions.
This is another part of the 'better deal for performers'.
Let us now move on to the legislative process. Since the beginning of September 2008 the proposal is being discussed with Member States in the European Council, and the French presidency has already presented several 'compromise papers' taking into account remarks made by various delegations.
It is fair to say that while some EU countries generally favour the proposal, others remain sceptical and some are even openly hostile. And the debate is often passionate. There are a lot of academics here in the UK who engage in general considerations on the length of copyright. But what they seem to be neglecting in their deliberations is that we are talking about real people here, not abstract concepts. It's pretty straightforward where I am coming from - and that's about as far away from an academic ivory tower as you can get. We are talking about livelihoods and payment for work rendered.
Opponents to the extension argue that an additional annual income of around € 2,000 per year for session players is not 'significant enough' to allow performers to participate fairly in the millions that the proposal would provide for record companies. Well to that criticism can I say that the average annual pay-out might not appear significant to academic critics, but € 2,000 extra per year is significant for an average session player.
And those critics might have overlooked that radio and television broadcast remuneration, and monies collected from bars, cafés and other public venues that play music, go directly to the performers via their collecting society. No record labels put their hands on this money. And I would also like to say that the session musicians' fund - for the first time in EU history - grants session players a right to participate in the sales revenue of sound recordings, at least in the extended term.
Including producers in the proposal makes sense: you always need producers to market the recordings and develop new talent. And without an extension for producers, there can be no session players fund either.
Finally, the 'use-it-or-lose-it' clause will make thousands of sound recordings available, which would probably otherwise remain, lost and forgotten in a vault somewhere.
While the debate in the European Council will continue into next Spring, the proposal is now making its way through the European Parliament. The Parliament's Legal Affairs Committee has presented its draft report and a report with their amendments will be voted on by January 2009. The Committee wants film actors to be part of the proposal and wants to strengthen the 'clean slate' provision for featured artists. Both of these amendments are welcome.
The associated committees in Parliament - culture, transport and internal market - are all expected to vote on their draft reports by the end of the year. The committees are favourable to the proposal and have tabled a variety of amendments that do not risk the overall aims of the proposal being met.
To conclude, there is one word of caution I want to share with you. There has been a debate between the record labels and the session musicians on how to distribute the money set aside in the fund. How should the amount of the claim be calculated? What revenues should be taken into account and how high should it be for the performer's part?
In the proposal we said that the performers would get 20% of gross revenue generated in the extended term. Some say that this is too much. They argue that it should be a percentage of revenue after the deduction of certain costs.
I do not intend to go into the details, but the industry and the session players had better come to a rapid agreement on this. And they have to do so publicly, because the enemies of term extension will exploit any discord among future beneficiaries.
And here is my warning: the proposal's chances for rapid adoption in first reading will not be enhanced if the two major beneficiaries, performers and record producers, are caught counting their chickens before they have hatched.
Thank you very much and good luck.
Feargal Sharkey speaks at Midemnet 2008
Hello, my name is Feargal Sharkey.
For those of you who don’t know, I am CEO of an organisation called, simply, UK Music.
An organisation which launched in October 2008 and has but one very clear, remit, goal and ambition - to bring together, under the same roof, representatives from pretty much all the UK’s commercial music sector.
That would include everyone from our artists, composers, songwriters and musicians to record labels, music publishers, managers, studio producers and collecting societies.
The premise for this development: the UK produces the most diverse, most exciting, most innovative and most successful music in the world and all of our members have a considerable and shared stake and interest in that.
With UK Music, for the first time, we, in the UK can truly have a single vision, a single objective, collective aspirations, opinions and viewpoints, one song, one voice.
And my applause to the member organisations and individuals who make UK Music possible. For their determination, insight and courage.
Because that unity becomes crucial when we want to tackle those big, truly all-encompassing issues; the ones, that will shape the destiny of our industry for decades come.
There is an astonishing amount to play for. And music and ISP relations are central to that objective.
All of us know that the inherent value of recorded music has yet to be realised in the digital era.
That value has been sucked away through unlicensed, unapproved sharing and copying. The status quo is unsustainable.
The health of the recorded music sector is a vital and essential cog in the wheels of our industry.
And the vibrancy of its future impacts upon all of us.
Now I can and do understand the frustration that a decade’s worth of repetitively futile conversations can bring – for everyone involved – and how on occasion that frustration can translate into despair and even anger.
But when emotion takes the place of logic, it takes us all two steps backwards.
In the UK, as an industry, we will adapt as we always have.
But I would caution that we need to remain acutely aware of music’s role in the bigger picture of a digital economy and a digital culture.
We must retain our sense of perspective, and ensure we are not seduced by the allure of easy options and Utopian sound bites.
It seems we are surrounded by an ever growing chorus of pseudo-intellectual cyber professors who will have us believe that their vision of reality is nothing short of the high altar of intellectual thinking. And to challenge those viewpoints and assumptions is nothing short of heresy and treason.
Are you with us? Or are you against us?
This is ultimately a creative and a commercial challenge and which can and should be solved by creative and commercial solutions.
In 2008, British Music Rights published the largest-ever academic study into the music consumption habits of 14-24 year-olds.
95% of respondents told us they were copying music; 63% told us they downloaded music over P2P – mainly because it was free – and mainly because they didn’t think anyone would ever notice. Of the downloaders, 80% claimed they would pay for a legitimate service, and they would continue purchasing CDs.
Their love of music – way above all other forms of entertainment - came over loud and clear.
All of us need to focus our energies on cultivating, nurturing and serving that demand.
We as an industry have to seize upon that agenda.
To paraphrase Dr Strangelove: 2009 should be the year the music industry learns to stop worrying and love the bomb.
Let’s reflect on a few facts:
Technology has always changed how we listen to music, how we consume it and how we compose music.
Music has always offered an effective way of building an audience – never more so than in the dot com era.
Yet in the world of bits and bytes, the competition for eyeballs and attention is incessant.
The result, I suspect for many, is fatigue.
But it also creates a fertile environment for music.
Are we truly still dazzled by technology simply for technology’s sake?
The concept of carrying 1,000 songs in your pocket – never mind an entire music collection - is no longer sufficient to blow anybody’s mind.
I think we all now recognise the absurdity that your MySpace friend count represents some form of tangible currency.
The answer has been and always will be simple. It is the music that matters.
The prospect of biting the bullet and embracing P2P should not seem as foreboding as it once did. We should not let words like BitTorrent strike fear and dread.
It’s simple: it’s the music that matters.
That Bon Iver album is still a great album regardless if your preference is vinyl, CD, download or stream. And ten years from now it will still be a great album.
It’s simple: it is the music that matters.
I very much welcome Nick Lansman’s comments about the value of music, and we too value and recognise the constructive role that ISPs can and do play.
By viewing ISPs as partners in the solution, I am certain that this can be the year that we all stop fretting about delivery platforms and concentrate on what really matters.
Without human creativity and high quality content, technology is exactly that: technology.
And is utterly redundant.
There will always be a bridge between the creator and the fan – whether that’s a record label, an aggregator, or an ISP. And all of us must and need to keep evolving.
* * * * * * * * * * * *
ISPs and start-ups are also operating in this new era.
As you’ve already heard this morning there is hesitation of venture capital that ponders the contradiction between incessant demand and a dysfunctional business model.
The telco sector might be a Goliath, but it is also a business in transition.
The financial spoils of the great migration from dial-up to broadband are being squeezed. The quantities of online content being consumed are putting terminal strain on our national network. Music online might not be a scarcity, but bandwidth most certainly is.
We are at the tipping point, where telcos and ISPs are also feeling the pinch from all that valuable creativity traveling freely up and down their pipes.
There is also clearly a welcome recognition of the value of music to their businesses.
This major, major opportunity needs to be seized. And it needs to benefit everyone.
Our joint objective should be clear.
- Unlock the true potential of digital music and give music fans what they want, legitimately
- Do it in a way that ensures that our artists, composers, songwriters and musicians - and those who invest in their careers - get paid
- and do it in a way that ensures the next phase of growth and development in the telecommunications sector.
It’s now not about whether we embrace each other. It’s more a case of will you still love me in the morning.
* * * * * * * * * * *
Individual countries are pursuing different approaches, but I think we would all acknowledge that the UK strategy has been amongst the most progressive.
Certainly, the UK Government is acutely aware of what is at stake. And that a heady cocktail of technology and creativity will be essential for the rebuilding of our economies.
The Memorandum of Understanding signed in the UK last July marked a significant step forward.
In essence, it focuses all players on the ultimate objective - developing the online market and establishing new secure profitable supportive business partnerships.
Relations between UK ISPs and members of UK Music have moved on considerably in the past 12 months.
BUT I REITERATE: THAT MOU IS ONLY A STARTING POINT. There is still much to do. And we need to accelerate the pace at which we translate constructive dialogue into deeds.
As reported in yesterday’s FT, the guiding philosophy to the anticipated Government report into the future of the UK’s digital economy is that the internet and music industries have failed to sort out the problems of illegal downloading between them.
Government now intends to impose its preferred solution.
As an ex regulator I would urge a word of caution to Government.
Any intervention must be designed to embrace new horizons and must be fit and proper for use in a modern world; a modern society and a modern culture.
For this industry, regression is not an option. We have learnt from our past mistakes and have no ambition to repeat them. Our future lies ahead not backwards.
Regulation brings a cost to all parties. We all need to be sensitive that the debt we pay for an imposed Government solution does not outweigh the benefits and the rewards.
This can and should be a hugely exciting time but it is also a time for open, innovative and clear minds.
We need to go beyond tired positioning statements and soundbites.
Which means it will also be a testing time for some seasoned speculators who present a peculiarly Utopian vision of a deregulated all-giving benevolent internet.
Times of turmoil have been good for the speculators, and music has been their whipping boy.
But the future is catching up with the futurists. The spirit of realism will overtake them too.
At our recent Creators’ Conference a young artist who also runs his own label spoke about how the internet has both helped and hindered his career.
He described the internet in terms of a Catch 22 “because the people you are contacting on the internet obviously know how to use the internet. So obviously the majority of them know how to get your music for free.”
“It is a bit like the Lottery this whole game - you can’t win with just three balls, you need all of the balls to win. You need TV, you need radio, you need the internet, you need promo. You need all of the balls popping at the same time or you’re not going to make it.”
We need to be clear that the decisions we take today will determine the legacy we leave behind.
For that legacy needs to be befitting of the next generation of artists, songwriters, musicians, composers and performers.
They are the ones who will have to carry that legacy forward and that will be long after history has forgotten all of our names.
For all of this. For everything in all of this. For everyone in all of this. It’s simple.
It’s the music that matters.
