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State of the Media - Vanessa Hutley - Music Rights Australia



As a follow on to the State of the Media industry survey undertaken by MediaScope and TrinityP3, this new profile series asks a selection of people to comment on issues affecting our industry.

Here we profile Vanessa Hutley, General Manager of Music Rights Australia who offers insights into the direct impact advertising revenue earned by pirated music sites is having on the music and creative industries.

Name:  Vanessa Hutley
Business: Music Rights Australia Pty Ltd
Your Role: General Manager

Please highlight your career to date?State of the Media - Vanessa Hutley - Music Rights Australia

I’ve worked as a lawyer in the creative industries for over 15 years. I was a senior lawyer at Microsoft for over 10 years and developed intellectual property programs in Australia, New Zealand and the South Asia Pacific region. Prior to that, I was in private practice.  Before that I worked in the publishing industry and I was also a high school teacher for a short time.

I have been with Music Rights Australia for two and a half years. Strangely all the work I have done in law, publishing and education now seem to have come together as I am responsible for the development of the education, advocacy and protection programs which are designed to help creators operate in an environment where their creative output will be respected and protected. I wish I could say this was all part of a grand plan but in truth I was just very lucky. 
 
What is Music Rights Australia and as General Manager - what do you actually do?

Music Rights Australia is a joint venture between the Australian recorded music sector (represented by ARIA) and Australian songwriters, composers and music publishers (represented by APRA and AMCOS), representing more than 70,000 songwriters, composers, music publishers and record labels.

The name Music Rights Australia and our tag line - Respecting and Protecting Creativity sum up our goals and reflect our focus on the rights of Australian music creators and performers.

I work with a range of creative industry associations to advocate for improvements in the intellectual property protection environment. I also work on a fantastic education campaign called Music Matters which is a campaign designed to remind everyone of the value of music in our lives. I also manage the protection program to stop the damaging impact of unauthorised use of music online.

What state is the music industry in?

The digital world offers the music industry great opportunities to connect with fans in new ways but it also creates some big challenges. 

Digital download and streaming services are now entrenched in the music ecosystem and in 2012 digital sales came close to toppling physical sales for the first time ever and the local recorded music industry experienced its first upwards trend since 2009. This growth was attributed to the growing demand and consumption of digital music products, which made up 46.29% of the industry’s dollar value in 2012 compared to 36.7% in 2011 and 27.2% in 2010.

Locally there are now over 30 licensed digital services and research by the Australia Council indicates that nine in 10 Australians listen to music each week. By way of contrast, only four in 10 of us exercise each week. The same research found Australians bought three recordings per second, with over 100 million recordings purchased in the 2012 calendar year.

Despite this amazing choice, which ranges from the traditional bricks and mortar music outlets to download services and streaming services across a variety of price points, including free with ads, the music industry still faces big challenges from unlicensed use online.

It’s a myth that the problem goes away if you just make it easier for people to get music legally. IFPI (International Federation of Phonographic Industries) research estimates that 32% of downloads worldwide are unauthorised. The top illegal BitTorrent site used by Australians is The Pirate Bay which had 1.2million users in June 2013, up 6% year on year.

The reality is the unlicensed use of music, be it downloading or streaming, has a significant negative impact on the local and international music industry and continues to be a real problem.

It is not a level playing field and this will continue to impact the resources of the music industry until there are changes to the local intellectual property environment which includes amendments to the Copyright Act to improve rights protection online and changes in community behaviour so that consumers start to respect the choices artists make when they put their music online.

This is not just a music issue. The 2012 PwC Report: The Economic Contribution of Australia’s Copyright Industries found copyright industries are responsible for almost 900,000 jobs – which is equivalent to one in 12 people in the work force. Everyone in a creative industry is impacted by this.

Several artists have been critical of emerging streaming music platforms – what is your view?

Artists have a right to choose how and where their music is made available. They have the power to make business and artistic decisions and those decisions should be respected.

However, we need to remember the licensed services are being forced to compete with illegal services. These illegal streaming and downloading services are set up by people who only want to make money for themselves. Nothing goes back to the artist.

Currently, the local copyright laws are not robust enough to help artists or their representatives take action to shut down the illegal sites or get the unlicensed music removed in an efficient and practical way.

Legitimate streaming services and other distribution channels are being asked to compete in this unfair environment.

How do pirated or free download music sites impact the music industry?

It is well- known music files are easy to copy. It’s also well known that this meant the music industry was the first to be impacted by unauthorised digital copying. The impact was huge, but despite this, the music industry continued to invest in new talent and new services to bring music to fans when and how they want it.

However, despite the availability of over 30 legitimate online services locally and over 500 worldwide, people are still choosing to access music through these unlicensed services.

Australians have an unfortunate reputation for being some of the biggest users of BitTorrent technologies to access unauthorised music and use of illegal streaming services is also increasing.  For example according to Nielsen research, cyberlockers accounted for six of the top 20 illegal sites used by Australians in June 2013.

Not one of these services gives money back to artists or the music industry. They exist only to make money for the people who set them up. They drain resources and revenues from the industry. This impacts future investment decisions and the ability of the music industry to continue to find and develop new talent and to invest in new services to bring music to music fans.

Many of these pirated or free download music sites are advertising supported – what does this mean to your industry?

Illegal sites rely heavily on advertising revenues to operate. There is a lot of evidence coming out of international court cases which shows the huge amount of money these illegal sites are making. For example in a recent UK case it was estimated that KAT (Kickass Torrents) made US$22 million from ads on the site. In an Irish case evidence was produced that The Pirate Bay had annual ad revenues of US$36 million and a study by Google and PRS for Music found that 86% of illegal music file sharing sites were ad State of the Media - Music Rights Australiafunded.

This is huge drain on the music industry and continues to undermine the services which make music available through licensed sites. Also nothing goes back to the creator whose music appears on the illegal sites. 

What can the advertising industry do to alleviate some of the issues you raise?

There is no silver bullet which will make this problem go away but the online advertising community can be an ally and work with the creative content industries to take practical steps to ensure brands are not inadvertently supporting illegal sites.

We have begun work with the Audited Media Association of Australia (AMAA) to engage with the online advertising community to ensure that everyone in the supply chain is aware of the damaging impact illegal sites have on the creative industries and to develop a code so that each player within the supply chain has a positive obligation to ensure they are not inadvertently supporting illegal sites by spending their advertising dollars on these sites. 

The goal is simple. We want a healthy online- advertising marketplace which works for the online advertising industry, creative content owners and consumers alike and this will also ensure that valuable brands are not tarnished through association with these illegal sites.
 
What’s ahead for the music industry?

If I knew the answer to that question I would be planning my retirement today. What I do know is that the music industry will continue its tradition of finding, nurturing and showcasing great local and international talent.

Music is at the forefront of innovation, internationally and locally.  New services are being announced all the time so fans can get the music they want, when and where they want it.

I am also optimistic that the inadequacies of the local laws will be corrected so we will finally have an internet that works for everyone: creators; service providers and consumers.

 

If you you'd like to share your views through these State of the Media profiles (either anonymously or named) - please get in touch

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Further Resources

  • State of the Media - follow on from The State of the Media research (co-produced by TrinityP3 & MediaScope & presented at Mumbrella360 in June) this new series aims to continue to raise awareness of the challenges facing the media industry...
  • MarketPlace - a growing range of selected products & services to help streamline & improve all aspects of the media trading process.
  • Women in Media Profiles - the most senior and experienced women in the media, marketing, publishing and advertising industry highlight their careers and what our industry can do better to support women and families.
  • Media Owner Profiles - we ask some of Australia's most successful media owners about running their business and ask them to offer advice to other media owners

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