Authorised by Yulia (www.yulia.co.nz)
Written by Glyn MacLean (Manager for Yulia)

LEGISLATING PROFITS

One of the important points that has come up in respect of the proposed changes to section 92a of the copyright act is the disputes resolution process and who administers this.

I would like to point out by way of an example; APRA's own administrative processes failing a respected and high achieving APRA member; Yulia.

It is our view that the APRA disputes resolution process is geared towards the complainant and not towards the rights holder and that this kind of policy is even more likely to fail the rights holders if it is administered by ISP's.

"DISPUTES RESOLUTION PROCESS"

Yulia wrote a song called "Love Siege" which is also known as "Languages". An ex boyfriend, who we will call MR X, who is a registered APRA member and who had previously registered songs with Yulia with APRA, decided that because he had recorded and performed on Yulia's song that he had actually written the song. MR X wrote to APRA and told them that Yulia had wrongly advised them about her writing the song. (In other words he was saying Yulia lied - affecting her credibility) He stated that he should hold at least 50% of the rights in the song.

APRA has an automated response to such "copyright dispute" (or the alleged and so called infringement committed by Yulia). APRA advised Yulia that they would put the song into dispute. This means that Yulia, and her business partners who had invested some $15,000 in the song could not collect any payments or effectively trade on the song until the dispute about ownership is resolved. All of this of course occurred after the song was re recorded with an entirely new arrangement which included none of MR X's performance or arrangement. Importantly, the song had started to get some notice overseas in UK market, moving up the Indie charts and winning a significant placing in major UK Songwriting competition.

Yulia provided APRA with scan of a CD on which was MR X own handwriting clearly stating "Song by Yulia". APRA decided this was not adequate evidence and brushed Yulia, her management and her lawyer off telling us to take the matter to a third party for resolution. Importantly, APRA made the judgement that the evidence provided by Yulia was not credible but had put the song into dispute despite the fact that no evidence was presented by MR X other than the fact that he had previously written songs with Yulia. This astounded Yulia's business partners and has diminished our confidence in APRA's administrative systems and processes and our faith in Ant Healey to protect Yulia's rights holding in NZ.

Yulia upholds the claim that she wrote the lyrics and the melody (whole song). She also states quite strongly that MR X is a disgruntled ex boyfriend who was trying to get back at her. Clearly thanks to APRA Mr X succeeded! APRA's response was to force Yulia to have to take costly court action.

After discussion with NZ's top intellectual property lawyer (at more cost) it was agreed that it would be more profitable to leave the song in dispute than to pay $300 an hour to resolve the dispute in court at our own unrecouped cost. APRA's inadequate disputes resolution process indirectly cost the artist the financial loss of the song.

What happened here is that an inadequate APRA disputes resolution process allowed a disgruntled ex boyfriend to disrupt Yulia's business income.

What this kind of administrative failure does is it leaves a loop hole in the system through which anti competitive persons could state that; simply because they have worked with an artist in the past, that they should have the benefit of the doubt in respect of rights holding in any future works, thereby allowing the complainant to put future works into dispute at the mere suggestion. This is obviously not in the Yulia's interests but is wonderful for any competitor or future complainant.

CONFLICTS OF INTEREST AND FAILED OBJECTIVITY

One of the major problems with music industry is that it's not what you know, it's who you know. If you offend the "industry giants" then you do so at the risk of being "locked out of the industry". There is rarely any amnesty for the whistle blower.

The moment a musician speaks up about RIANZ, APRA, MMF, NZ ON AIR that artist will be subject to an adverse emotionally charged response from the decision makers of industry, many of whom are pals and bossom buddies. Thus some remarkable NZ artists have been held back by this culture of silence and blocked opportunity in which even some Govt representatives have voiced adverse personal opinions that have affected commercial careers.

This kind of conflict of interest has to to stop.

INDUSTRY PERSONNEL

Thus I would like to raise the point of who is contributing to the policy which would be administered.

If we were to "stock take" the leadership of the Recording Industry Association of NZ
and the Australasian Performing Rights Association we would find some interesting facts.

WE ARE AUSTRALIAN!

First of all, APRA is based out of Australia. That's why it is called the Australasian Performing Rights Association. While some would argue that APRA is very "Kiwi" I would suggest that what we define as Kiwi is more influenced by transnational corporations and here is why;

The staff of transnational corporations runs NZ music industry.

Years ago independent radio stations were bought out by two competing radio networks: Radio Works and The Radio Network. Both of these corporations are owned by transnational corporations and return profits to Dallas, USA and Canada. Only two program directors work with two NZ On Air staff to determine which NZ artists are placed on NZ radio.

The public knows very little about the actual mechanics of commercial music and the fact that it is not the least bit democratic. Decisions are in fact made based on advertising demographics.

Within APRA and RIANZ we also find that the leadership has both historically (and continues to be) largely lead by persons who hold rank within transnational corporations. You must understand that a manager within a company is legally obliged to ensure a return of profits to the shareholders of that transnational corporation and they must (according to their employment contract) at all times uphold the interests of that employer. Therefore the NZ Govt has over a period of two decades allowed record labels whose interests are defined by private transnational corporate profits to determine the future of NZ music industry.

The decision makers represent companies that traditionally exploit artists to the extent that few NZ artists have seen financial success despite high achievements - the artists have been too afraid to speak about it; the high level of exploitation.

A massive proportion of the NZ tax payer dollar goes to transnational corporations which exploit NZ artists. Major record labels have the system stitched up. They coordinate their infrastructure to ensure that they comply with funding criteria and then use NZ tax payer dollars to fund NZ artists. In many cases those record deals have been so geared towards the profits of the transnational corporation that the artist has ended up on the dole in NZ. I would love to see some facts pertaining to the artists who were flat broke after the huge financial success of the record label.

In the case of Yulia, she received in sum total approximately only 3% of the total revenue of her her albums. She has to pay for all of the costs of the making of her albums while SONY maintains the actual ownership and control of her albums. She signed as an 18 year old without much support or information and was only ever given a short form (loose) agreement which did little to protect her interests. Yulia's achievements include 3 radio hits, two number one hit albums and six times platinum sales. Despite demand for her albums worldwide SONY has failed to support Yulia's dream of making her albums available overseas. This is not abnormal in the music industry. The same kind of thing happened to George Michael who fought back over a period of years and then released his amazing album "Faith". Sony have offered us the opportunity to buy back Yulia's master recordings so that she can once and for all begin marketing herself overseas. Sony will only allow Yulia to license with "authorised" SONY agents in any territory and despite interest from many music publishers and distributors Yulia is "stuck" and unable to move forward with a body of work that is amongst some of the most highly respected work ever created in NZ. This is entirely legal but it's obviously very unfair. Is this the experience we want artists to continue to have in NZ?

Suffice to say there is much misinformation in the game of big (music) business. The incumbent leadership wants the NZ public to believe what ever they tell them. Because they hold positions of authority, the information they provide should have integrity. I would like to suggest this; that there is an alternate truth out there amongst NZ musicians that have been systemically exploited to the detriment of NZ music industry. This begs the question, "Why are we allowing these people make decisions about the future of NZ music?"

NEGATIVE FOCUS

In my short time on earth I have built three multi-million dollar music retail or wholesale businesses for other people. I know a thing or two about adding value to the consumer and making profit. My point here is that the music industry is trying to legislate profits rather than to accept responsibility for investing in a new business model which would benefit all of the stakeholders; the consumer, the retailer, the distributor, the manufacturer and the inventor. Consumers are voting with their wallets and the industry doesn't like it. It only costs $2 to manufacture a CD and yet CDs had been in NZ for up to $35 with most of the profit not going to the inventor (songwriter/artist).

NZ Govt needs to invest in innovating new ideas for commerce and working with NZ owned and operated business such as those who are members of Independent Music NZ (IMNZ). We need to stop funding transnational corporations and overseas shareholders and start funding NZ music enterprise for overseas export. An example of the problems with the current system are that we have people like Kylie Harris (Country Music) completely unrecognised in NZ with Country Music completely unsupported despite it's massive commercial success worldwide. We've done nothing in NZ to dispel the abject horror at the use of the words "Country Music" despite the fact that names like Jewel, Shania Twain and Taylor Swift are household names here in NZ. Similarly NZ has some of the worlds leading classical crossover and folk singers, the industry does very little to support much outside grunge guitar or urban music and that's because everyone in the industry thinks "Band".

The whole point of this blog is to expose you to the idea that the people leading the development of legislation in NZ do not necessarily have the artists best interests at heart.

Neither do they necessarily possess the acumen with which to establish the future direction of the music industry. Do you go to Warners Music whose shareholding value has declined almost 70% in the last year or to ex Virgin staff whose stores have shut down all around North America for advice? Or do you go to ReverbNation.com, Amplifer.co.nz, txttunes.com, aimestreet.com, Lastfm.com, iLike.com, and facebook.com who are all growing at a fantastic rate through cross marketing and licensing and distribution agreements between each other?

The future of the NZ music industry will not be maintained through legislating profits.

It will be maintained by adding fair value to ALL the stakeholders that contribute to the process and by adding real value to consumers.

Glyn MacLean

Manager

YULIA

"Voice of rare Beauty"
www.yulia.co.nz

ALMS ELECTRONICA

"Music with a Conscience"
www.almselectronica.co.nz

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