German song rights collecting society GEMA yesterday hailed its "most successful financial year to date", but noted that digital growth in 2023 was somewhat disappointing.
Contrasting its own numbers with the digital revenue growth rates reported by the record industry, the society said it would continue to campaign "intensively" and "consistently" to secure a "fair share" of digital income for its songwriter and music publisher members.
Globally, the record industry saw digital revenues grow by 10% last year, with German record industry trade group BVMI stating that digital revenue in its market was up 7.9% year-on-year. GEMA saw digital income grow by just 3%, and that was partly due to "new video-on-demand contracts".
"Although the market is growing, GEMA’s revenues from music streaming have barely increased year-on-year", the society said in a statement. "This makes it all the more important for GEMA to continue intensive and consistent campaigning for a fair share of the revenues from digital music use in its negotiations with digital music platforms and politicians".
There was more upbeat news within the GEMA figures related to live music. The German live sector at large has fully bounced back after COVID, it said. Total public performance income was up by 24% to €444 million, significantly up on the pre-pandemic peak in 2019 of €407.4m. Total GEMA collections were up €99 million year-on-year to €1.27 billion.
In terms of the digital disappointment, GEMA clearly believes that part of the problem is the streaming business model. Many songwriters have long criticised the fact that, with music streaming, 50-55% of revenues flow to the record industry and the services keep 30-35%, while 10-15% normally flows to songwriters and music publishers.
The share allocated to songs on a stream is higher than with a CD, in some markets more than double, though not in Germany where the rate on a CD is higher than in the UK. The share allocated to the song has also increased since the streaming services first launched, while the share going to the recording has decreased.
Nevertheless, many songwriters argue that - given the different role played by labels and retailers in digital - the song share should be significantly higher. Achieving that is tricky, given that streaming services separately negotiate recording rights and song rights, so there isn't a forum where all the stakeholders come together.
GEMA's statement suggests that, while it will continue to negotiate hard to get a better rate directly with the services, it also hopes the political community may be able to help in some way. Quite how isn't clear, although the Culture Committee of the European Parliament last year called for new rules to regulate music streaming, stating that “pre-digital” conventions that tend to favour record labels should be “revised”.
