Warner Bros exec talks safe harbours and infringers

When illegal downloaders first appeared, the music industry’s initial response of suing infringers was unsuccessful, according to a Warner Bros executive.

Lisa Margolis, senior vice president of business and legal affairs in the music division at Warner Bros, explained that the attempt to litigate angered fans and customers.

She was speaking in a personal capacity on a panel, “On a different note—copyright and music”, which took place yesterday, October 15, at the 2017 AIPPI World Congress in Sydney.

The Digital Millennium Copyright Act (DMCA) and safe harbours under it were some of the main topics discussed by the panellists.

In February, a coalition of music organisations described the DMCA as being “broken and antiquated”, and that the “key failings” of the DMCA’s safe harbours contribute to this “untenable, grim reality” for all content owners and creators.

Ingrida Veiksa, department head of legal sciences at Turiba University, Latvia, presented statistics taken from the “Global Music Report 2017”, published by the International Federation of the Phonographic Industry, an organisation that represents the interests of the recording industry.

Platforms such as YouTube are using the safe harbour defence as a “shield to avoid licensing”, she said. This creates a value gap, which is a “threat to the future of the music industry”, added Veiksa.

The statistics also showed that Spotify pays $20 per user, compared with YouTube paying less than $1 per user.

Margolis added there is currently a lot of controversy on this topic and she hopes a solution can be found.

“Legislatively, this would require revamping the DMCA and I’m not sure how long this would take,” explained Margolis, adding it is hoped YouTube will increase the rates being paid.

The music industry was the first to be disrupted by the internet, explained Andrew Wiseman, partner at Allens and panel moderator, and other industries should learn from it.

Dan Rosen, CEO of the Australian Recording Industry Association (ARIA), added that recording revenues halved between 1999 and 2014 from $15 billion to $7.5 billion, predominantly due to piracy and having to adjust to the digital business model.

However, over the last two years, the industry has experienced growth, with the largest revenue channel coming from streaming services that didn’t exist five years ago.

It also seems like ‘hipsters’ are driving physical revenue—vinyl makes up one quarter of all physical sales in Australia, which has doubled year on year.

The 2017 AIPPI World Congress is taking place between October 13 and 17.