New Licensing Models for Online Music Services in the European Union

Abstract

This paper examines the restructuring of online rights management that the E.U. Commission recently imposed upon collecting societies and copyright holders in the online music sector in order to foster the adoption of multi-territorial collective licences covering the whole territory of the European Union. The paper examines the responses of major international music publishers and national collecting societies to the Commission's action by focusing on the emergence of distinct types of new licensing models and on the legal problems and questions that these new models have posed so far. The scenarios that have materialized in the last years show how the pan-European monorepertoire licensing models of the major multinational music groups affect the economic sustainability of national collecting societies and the online rights clearance solutions made available to commercial users. The paper also examines whether the above restructuring is of any help to rights holders and rights managers who find it convenient to combine commercial collective licences and noncommercial individual licences (e.g., Creative Commons) in the management of online rights over their works. The paper takes the conclusion that the radical modification of the structure of online music rights management recently pursued by the E.U. Commission has mainly failed its policy objectives while making online music rights clearance even more complicated, legally uncertain and discouraging. The paper also indicates what legislative amendments the Commission might consider proposing in order to rationalize and greatly simplify collective rights management in the digital environment and what the easiest and most productive model for the development of E.U.-wide music rights management could be.