Robert Ashcroft, Chief Executive PRS for Music writes ahead of the EU Copyright Directive vote in Brussels today

12 September 2018 - Editorial

Today there will be a vote in Brussels on the proposed Copyright Directive. Fundamentally this aims to ensure that creators have a greater level of control over the use of their work online than is currently the case. However, some of the major digital service providers have put it about that it will lead to the end of the internet as we know it.
 
Given the cataclysmic nature of their predictions you would have thought that the share prices of some of the major players would have been in freefall as a result.  But that is patently not the case, so what is going on?
 
Streaming now dominates the consumption of music, which is more popular now than it has ever been, but there is a dark side to this story: the creators of all this growth are only seeing a fraction of it because user upload platforms refuse to pay a reasonable rate for the creative material they host, compared to the value they derive from it.
 
YouTube is the largest provider of online music in the world; its business model is inextricably tied up with that of its parent, Google/Alphabet, which has a market capitalisation of $850 bn. and YouTube alone is worth $75 bn, yet they pay one of the lowest pay per stream rates in the sector. Given this, perhaps it is not surprising that YouTube and Google are leading the resistance to the proposed Copyright Directive.
 
YouTube’s Chief Business Officer, Robert Kyncl, published a blog this week pointing out the promotional value of the platform, an argument raised by US radio since the 1950s, but even US radio pays songwriters a fair value for the use of their works.
 
The fact is that if all internet platforms paid fairly for the content they monetise so successfully, we would all be better off, as I argued in a paper published with George Barker “Is Copyright Fit for Purpose in the Internet Era”.
 
Perhaps it’s because we would all be better off if the platforms paid creators properly, that explains why the analysts are not being fooled by the prophets of doom and can see a prosperous future even if the Copyright Directive becomes law.