Artists have rights that need to be protected, for both what they write and when they perform. These rules and regulations are laid out in laws and treaties. For instance, every time a song is sung and broadcast, both the writer and the singer are entitled to a fee. In other words, artists rights are about money. These rights extend to radio, television, theatre performances, webcasts, movies, live concerts, etc. Basically, it’s impossible for the artists to oversee where and how their “products” are broadcast. That’s why they sign contracts with a collective management organisation (CMO) to represent and protect their rights. Ensuring that the right people receive any money due. And that’s not simple, because the rights are seldom with just the original artist. Often, there’s a producer or production company. Add to that: agents, heirs, mother companies. All these business partners want their cut.
Considering how complicated this business can be, the need for professional organisations to oversee and manage the data streams is unsurprising. Working not only domestically, but also internationally, because rights don’t stop at borders.
These days, there’s a worldwide network of organisations managing these artist rights. Exchanging data, charging broadcasters, paying rights holders. Mainstream media is relatively simple, but what about other types of media? Especially with a small amount of usage and the rights in faraway lands. You need extremely efficient tooling to register and recover this revenue. It’s worth remembering, all these small amounts together add up to a great deal! Also in other facets, rights management organisations need to work efficiently, because the more money they cost, the less left over for the artists themselves. A lose-lose situation.
It’s time to shift the focus, what digital systems do we need to do the work for rights management organisations? Firstly, these systems need to be able to register the artists, representatives and other beneficiaries. As well as the relationship between these parties, both domestically and internationally. Secondly, to register all the contracts between the artists and the rights management organisation, in all its many facets. Thirdly, the biggest challenge is to interpret international law and treaties, calculating the charges for the broadcasters and the amounts to be paid to the artists. Subsequently, the systems must compile and send out the invoices and payment letters. These documents require varying levels of transparency. Finally, there needs to be a credit management sub-system for late and disputed payments.
Today’s globalisation means that cooperation between the various rights management organisations is key. To collect, receive and distribute foreign and domestic money to foreign and domestic artists.
Now, the “64,000 dollar question”, what software and systems can meet these challenges? As a starting point for these applications, there’s certainly a central role for modern data collection and exchange. Here, we use the IT terms of web services and APIs. Also, these systems have to be fully loaded with algorithms and automation, for calculating the charges and pay-outs. Taking into consideration complicated extra dimensions, like earlier payments, or payments that are settled many years later. Advance payments are common in this branch, to be subtracted from later payments. Some payments might even be issued with a specific purpose. Like a scholarship for artistic courses, or to pay for a child’s education.
At the most basic level, the systems need to issue invoices to the broadcasters and ensure that payment is received. And show clearly to the artists what they have received, for what and what they need to pay out. All as efficiently as possible.
Rights management systems have to tackle what we call “big data problems”. Handling large volumes of extremely diverse and difficult data that needs to be processed at high speed. And totally complete. Artists need to experience, as well as feel, that they are fairly represented. Otherwise, they might transfer their interests to a competitor.
We foresee big changes in the business of rights management and the role of CMOs, both in Europe and on a global scale. Where many organisations are bought or taken over by their competitors. Where national rights management organisations take on extra services, managing the rights of artists from other CMOs in other countries. Therefore, having your business in the best shape possible will create new and lucrative opportunities. As a rights management organisation you need to prepare for the future. That starts today.
ICORP is specialised in algorithm-based technology, offering robust and proven solutions for rights management organisations. Read more about a specific case in Germany.
If you would like to know more, contact us.