The Monopoly beneath: Support systems and how the hinder alternative licensing in music

Citation: John Hendrik Weitzmann (2010/09) The Monopoly beneath: Support systems and how the hinder alternative licensing in music. Free Culture Research Conference (RSS)
Internet Archive Scholar (search for fulltext): The Monopoly beneath: Support systems and how the hinder alternative licensing in music
Download: http://wikis.fu-berlin.de/download/attachments/59080767/Weitzman-Paper.pdf?version=1&modificationDate=1285066014000
Tagged: Economics (RSS) Germany (RSS), collecting societies (RSS), music industry (RSS), GEMA (RSS)

Summary

Paper examines lock-out effects of collective right management, specifically those detrimental to alternative licensing of music in Germany.

The monopoly of German music collecting society GEMA, is, as the author notes, protected by statutory provision. GEMA is a private organization, though highly regulated.

Unified royalty collection and imperative membership has been threatened by new uses not presumptively governed by existing monopoly collecting societies and by EU and national competition initiatives that question monopolies.

Despite these pressures, the author says GEMA remains as a quasi-monopoly, with substantial credit going to reporting systems, which no broadcaster is significantly incented to change. These systems form a "soft law" and barrier to market entry for alternative royalty collection, excluding artists who may wish to offer their work under a Creative Commons (CC) NonCommercial (NC) license (which explicitly do not waive royalty collection) and be represented by an organization such as Jamendo (a web platform that hosts CC-licensed music, both NC and non-NC, and offers private licenses to businesses who wish to have rights and assurances to use said music).

Author says that unless and until the relevance of airplay decreases, reforms are necessary to "reach a functioning competition around online music" and enumerates three types of statutory reform to address lock-out of reporting systems: (1) it could be required that existing monopoly collecting societies be required to allow other representation to use existing reporting systems; (2) existing reporting systems could be placed directly under control of a neutral regulating agency; and (3) existing reporting systems could be put under a collective of GEMA and other players in the market.

Theoretical and Practical Relevance

Shows information technology systems contribute to entrenchment of monopoly even as legal/regulatory basis of same monopoly is under pressure.