Copyright chief: The Emperor Has No Clothes

CISAC's Eric Baptiste

Interview Next week authors and composers meet in Washington DC for their biennial summit. The conference brings together big copyright users - broadcasters, digital companies - under the same roof as the creators and the member's societies. It can get pretty lively. As a preview, we asked Eric Baptiste, head of the International Confederation of Authors and Composers Societies (CISAC), to run over the hot topics.

Since the last summit in 2007, have you seen attitudes change? Has the newspaper crisis made a difference to the way copyright is discussed?

It might be the papers are being affected, but I'm struck by what seems to be a growing realisation that while no one wants to stick to old business models, there is no business if everything is for free.

When you listened to commercial radio or watched the BBC or bought CDs, all those things are paid for one way or another - not always by the public directly, but advertising and payment and license fee all created a stream of money. Licenses are being granted and the authors are being compensated, it's a real economy. When you move from this to nothing, to "everything is free", that's not a real economy. And nobody knows how to make the world spin with those rules.

There seems to be a realisation the Emperor Has No Clothes. We need to meet the demands of today's public - they expect a few different things compared to my parents' generation, but we need to make it work with a real business, and not monkey business.

And it should be transparent. If you're a member of the public and you just want watch a movie or listen to a song, you shouldn't need to be a copyright expert. You shouldn't need to worry how much is going to the society, and how much is going to the real people behind those entities. We should find a way to make that disappear. It should be on a B2B level not a B2C level.

If we had established a framework 60 years ago such that when you went to a concert or saw a movie, it required a separate payment on top of the admission - or an additional payment on top of the CD price - then the business would never have taken off. It's not fun.

So there is also probably a greater unity in the content business at the higher level - we're in this together. How to agree on a licensing framework that is simpler for users of works - the users in this context being corporations.

Such as Apple and other digital services companies?

Yes. The reasons for being optimistic are that we have to think in new terms, and think together - but it's very hard.

What in particular makes it hard?

The repertoires that are controlled by societies are now quite fragmented. It affects only a very small portion of the business, the digital multiterritorial stuff, but this is now a very confused area. It's difficult for any business to be sure they have acquired all the rights.

And there are some businesses still playing cat-and-mouse with rights holders. And sometimes they're using the fact of fragmentation of the repertoires to justify not licensing. Unfortunately it's the most visible interest to people like you.

But the fundamentals of live concerts and broadcasts are still quite strong.

We just have a lot more media now - isn't it natural that advertising rates will fall?

Yes, that premium isn't there any more. New broadcasters have emerged, but if you add up all the revenues, you get less than before.

Which brings us to the European Commission decree last year, which rules that societies are monopolies and anyone should be able to license content from anywhere in the EU. You're appealing against this?

22 of the 24 societies are appealing the ruling, and CISAC has also appealed. We think it's a wrong analysis of the situation and we want to know what we can or can't do. Societies are there to license users. We have to wait for what the European Court will say.

There's no one-stop shopping anymore. We were working to put that in place in the Santiago Agreement [2000] which got struck down by the European Commission [in 2004]. It would put together all the world's repertory and enable one society to grant a worldwide license. That was a very bold move. - It's a pity it was not appreciated at the time by the European Commission.

Societies would be competing against each other to rip their members off. That's lunacy

When you talked about businesses being disingenuous, which ones did you mean?

It happened with YouTube here in the UK.

We have a dialog with them to try and understand what they need - because they are very relevant. But based on what I know, when they decided to pull all the UK premium content - despite the PRS not requesting that - that was not helpful. It gives the impression that rights societies are difficult to work with and willing to withdraw works from the public. But nothing could be further from the truth. This content is worth nothing without an audience, and our intention is to make it widely available - but at the right price, a price that rewards the labour of people who are producing those great works.

And some companies have more revenue than others.

For businesses with large followers, the business itself is not following. If you look at some of the numbers for the income of something like YouTube, it's $200m or $300m a year - which is nothing to a major TV network in a country like the UK. So even if everyone was able to strike good deals with those sites, the destruction of value would be huge.

Now it's like physics - value is never destroyed, it goes somewhere else. Network operators are very prosperous businesses even in this economic crisis, they're not doing so bad. So there must be something they can grab at the expense not only of content creators and owners, but also people who used to mediate. There's probably something to be explored there together.

I'm not sure ISPs are quite so happy. The price of broadband is probably tending to zero, but the cost isn't going down as fast. The heavy users of content don't pay any more than the light users, who are subsidising them.

That's another aspect of the destruction of value. If you wanted to price them at fair value you would at least need to be an order of magnitude higher than it is now.

If an ISP had a license to give people some kind of movie or music access service, then perhaps you could build a business there. But it's hard to put the genie back into the bottle - do you think you can?

It's hard, but things can change. People were laughing at HBO when it first launched - and CanalPlus in France - but now they're successful businesses. And if you can explain what it is to the public .

We need to rely on a mix of understanding licensing terms, and being able to experiment, and if the business has no turnover the rights owners should not subsidize the business by giving the content away for free. If you don't pay your electricity bill you'll get cut off.

If you view copyright as a payment for labour - a special form of labour - it's surprising the EU seems prepared to drive this "wage" down to zero.

In all fairness, everyone knows CISAC is on the record for not liking the decision, but the people in Brussels all recognise their goal is not to lower the royalties but to create a market for multiterritorial users. They're using tools that are a little blunt, but the end result is what matters.

I don't know anyone who is able to say this is good.

The proposal means if you went to a country with no copyright protection, you got zero. The EU is a big work in progress and you have countries that have sophisticated copyright protection from the 19th Century. Here in the UK, people understand what it is. But in many new countries the courts don't understand copyright.

It makes it very difficult for the society to maintain the value of those rights. Of course all those users would go to the copyright havens - it's an irrational business for societies to allow such a system. They would be competing against each other to rip their members off. That's lunacy.®