- State Intellectual Property Office of China
- Ministry of Science and Technology
- Ministry of Commerce of the People's Republic of China
- Ministry of Culture of the People's Republic of China
- Ministry of Agriculture People’s Republic of China
- State Administration for Industry & Commerce of the People’s Republic of China
- General Administration of Quality Supervision,Inspection and Quarantine of the People's Republic of China
- The Ministry of Public Security of the People's Republic of China
- Ministry of Industry and Information Technology of the People's Republic of China
- China Customs
- The State Administration of Radio Film and Television
- The Supreme People's Court of the People's Republic of China
- State Forestry Administration of the People's Republic of China
A Special interview with Ms. Frances Moore ,CEO of IFPI
17:18, November 23, 2010
People's Daily Online: In China we gradually pay attention to the music copyright, and there are a lot of audio and video associations here, but there is some chaos in the management of these organizations. As an expert of this area, do you have some suggestions?
Frances:First, CAVCA should improve the transparency of its management and distribution policies. Second, it should reduce its administrative fee from its current standard of 50 per cent.
People's Daily Online:How does international recording industry association charge the fee?
Frances:The situation varies according to the competition between music licensing companies in different markets, but 20-25 per cent is considered high in Europe.
People's Daily Online:Another issue is the standard of user fee and there is no uniform standard, and current standard is not reasonable.
Frances:There is no universal standard in Europe. The standard should be set locally, based on government policy and market conditions. It also depends on which rights are in place in any given markets. Many rights are best managed by a collective administration, but we would always like this to be on a voluntary basis.
People's Daily Online: How do you set up your standard overseas?
Frances:The standard is based on the market competition and economic research without direct government intervention in most cases. We don’t support the imposition of collective administration. However, it makes sense for smaller rights holders to voluntarily affiliate with organizations such as Sound Exchange in America, to help secure the enforcement of their rights.
People's Daily Online: Nowadays, online music infringement has been a problem; do you have some suggestions for that?
Frances:We have long believed that internet service providers (ISPs), the gatekeepers of the internet, hold the key to rolling back high levels of online piracy. Yet while ISPs were happy to talk, they were not very keen to act. That is why we had to approach policymakers to talk about legislative and regulatory solutions to the problem of online piracy, notably the graduated response approach.
Graduated response sees rights holders, such as record companies, present ISPs with an evidence pack showing an IP address that has been used to seriously infringe copyright law. ISPs then write to their users, urging them to ensure their account is not used to illegally distribute music, but to use legal services. Most people will stop breaking the law at this stage. If they continue to break the law and ignore repeated warnings, then a sanction is imposed, such as bandwidth restriction, a financial penalty or account suspension.
Graduated response has been passed into law in Chinese Taipei, France, South Korea and the UK. It is about to be made law in New Zealand. Other countries, including India, have indicated they will put forward similar laws. In China, ISPs are gaining money from legal and illegal use of the internet. I think the government should require them to be more responsible.
People's Daily Online: There is an opinion that music creation is to make people share fun and enjoy it, and pirate can make recreation for people, so it doesn’t matter piracy exists. How do you see it?
Frances:It takes a lot of investment in time and money to bring a new artist to the public. The artist need to be paid an advance so he can give up his day job and write, rehearse and perform his music. A studio producer and session musicians need to be employed to help him record an album. The videos we all enjoy need to be created so that we can know who the artist is and get to know his music. Investment needs to be made in tour support and publicity so that consumers know a great artist exists and get excited about him.
That can take up to US$1,000,000 in investment to break an artist in a single market. Record companies must have a fair chance of making that money back or they will not be able to invest in artists.
All the people involved in the process need to make a livelihood or they will go and work in other sectors. That would ultimately mean less quality choice for consumers.
People's Daily Online: There is another question that music producers should collect money, but how much money they should get reasonably?
Frances:We believe the price of music should be determined in a marketplace operating under the rule of law. Record producers take a great risk when they invest in artists, many do not connect with the public and generate enough revenues to enable the record label to recoup all the money it spent on nurturing, developing and promoting them. Between one in five and one in ten artists do prove to be profitable for the company that invests in them, and the revenue they generate offsets the losses made in backing other artists and enables them to sign new acts and bring consumers a constant supply of new music. This is the virtuous cycle of investment at the heart of the recorded music business.
People's Daily Online: What are the functions of international recording industry association?
Frances:IFPI's mission is to promote the value of recorded music, safeguard the rights of record producers and expand the commercial uses of recorded music in all markets where its members operate. We support our members through our legal policy work, strategic litigation and online content protection program.
People's Daily Online: What are the major problems faced by IFPI?
Frances:The major problem facing IFPI and our industry is internet piracy. Our members have developed a legal digital music sector in partnership with entrepreneurs and other retailers, but these businesses have not been able to thrive because of the suffocating levels of online piracy. It is a global problem, but China suffers particularly badly. It should be a leading music market because of its huge population, high broadband penetration and love of music, but it is only the 26th largest music market in the world, behind countries such as South Korea.
In China, we also have a problem because of the lack of public performance and broadcast rights. Such performance rights account for 5 per cent of record companies’ revenues worldwide and their absence in China is another reason the market has not developed as it should. It is only fair that when a commercial third-party uses our members’ music to help them make money, that our members be paid a fair rate for it. This is what happens in most fo the world.
People's Daily Online: What are the criteria for people to become membership of IFPI?
Frances:IFPI members have to produce music on a commercial scale and make it available to the public. Our 1,400 members include international companies such as EMI, Sony Music, Warner Music and Universal Music, but we also represent many independent labels worldwide.
People's Daily Online: At present the global recording industry is depressing, what do you think of the industry in future?
Frances:The recorded music industry has been seriously damaged by online piracy in the last decade. It has been very difficult for record producers and licensed online services to compete with the free online distribution of copyrighted works on a mass scale. Record companies have licensed more than 13 million tracks to over 400 services worldwide, but these services cannot thrive as they should without a healthy legal environment that protects intellectual property rights online. Other businesses, such as film makers and games designers, are suffering in the same way.
Thankfully, politicians do seem to be getting the message that action needs to be taken. Yet they need to move more swiftly if they are to put in place the protection the creative industries need before those businesses have already reached the point of no return with declining revenues destroying the incentive to invest.
By IP Channel of People's Daily Online