Written evidence from UK Music
ABOUT UK MUSIC
UK Music is the umbrella organisation which represents
the collective interests of the UK's commercial music industry
- from artists, musicians, studio producers, songwriters and composers,
to record labels, music managers, music publishers, music licensing
organisations and collective licensing companies.
UK Music consists of:
- Association of Independent Music representing
850 small and medium sized independent music companies;
- British Academy of Songwriters, Composers and
Authors with over 2,200 songwriter and composer members;
- BPI representing over 440 record company members;
- Music Managers Forum representing 425 managers
throughout the music industry;
- Music Producers Guild representing and promoting
the interests of all those involved in the production of recorded
music - including producers, engineers, mixers, re-mixers, programmers
and mastering engineers;
- Music Publishers Association, with more than
250 major and independent music publishers representing close
to 4,000 catalogues;
- Musicians Union representing 32,000 musicians;
- PPL representing 46,000 performer members and
5,750 record company members;
- PRS for Music representing 73,000 songwriters,
composers and music publishers.
INTRODUCTION
1. As a nation, the UK is the second largest
producer of music repertoire in the world and one of only three
countries that can claim to be net exporters of music. Last year
approximately one in every ten albums sold in North America and
Canada was made by a British artist. Earlier this year UK Music
published our vision of the future, an industrial manifesto for
growth, "Liberating Creativity". It unveils our single
ambition for the next decade: to challenge the United States as
the largest music-producing nation in the world. We know that
there is a desire for high-quality, well-produced, musical content;
it is this demand, which will be core to our ability to deliver
on our growth potential.
2. Exports in the music sector take a variety
of forms. We have a long history of exporting music on physical
formats such as CD. Other types of international income that music
generates include online and mobile music sales; licensing of
music rights to international broadcasters; licensing of music
rights to international partners for distribution; licensing of
music rights to film, televison and games - particularly in the
USA; touring and live performance; and professional services (eg
music production, recording services). Particular strengths in
recent years have been collective international music rights licensing,
licensing to film, tv and games, and live music (through both
touring and the tourists that it attracts). For example Visit
Britain suggest that music is the second most popular reason that
tourists choose Britain, after our museums.
3. The ratio of international to domestic income
will vary depending on the product and the partnerships of the
company selling or licensing it. In the case of recorded music,
international income can be a substantial slice. Where the product
and trading partners are exceptionally strong, it can be over
50% of the income generated.
4. The music sector has a culture of international
trade. For example, a survey conducted by the Association of Independent
Music showed that a very high proportion were exporting, with
65% in the EU, 62% in the USA and 36% in Japan. The majority of
the companies surveyed are micro-businesses, and the figure is
high when compared with other small businesses. For example under
a quarter of Federation of Small Business members export.
5. However accessing the finance and market access
to fully exploit international opportunities is a problem. Companies
who have been able to establish a base have been very successful.
British record company and music publisher Beggars Group have
established a 35 person office in the USA, which has allowed them
to achieve great success in the American market.
THE GOVERNMENT
TRADE WHITE
PAPER
6. UK Music did not make a submission to the
Government's Trade White Paper, and refers the committee to the
submissions by our members PRS
for Music and the BPI.
7. We highlight the calls of the collection society
PRS for Music
for "an appropriate legal and operational infrastructure
which supports the licensing of music rights [internationally],
and to ensure that there is value for IP in those markets".
They forecast that there is significant potential international
revenue growth for their members, which could be boosted by Government
placing IP prominently in the UK's trade negotiations and reducing
barriers to trade.
8. We also highlight the BPI's comments from
the perspective of recording companies that it can be challenging
in both emerging and established music markets to realise the
value of their exports where there is widespread unlicensed use
of British music, and where their rights are not always recognised
or respected.
The role of UKTI with regard to identifying opportunities
in established markets, emerging markets, key sectors and working
with businesses both large and small to take advantage of these
opportunities
9. UK Music recognises the vital role provided
by the specialist team at UK Trade & Investment. Through the
Music Export Group, and close relationships with employers and
trade associations, UKTI have developed a strategy that works
well for our industry. UKTI prioritise the USA, Japan, France
and Germany as the essential established markets for music. They
have also been instrumental in offering intelligence on our sector
to the international trade teams around the UK and within the
commercial divisions in key embassies. We would hope that with
the abolition of the Regional Development Agencies, and introduction
of Local Economic Partnerships, that these effective support systems
for businesses that want to trade internationally are maintained.
10. UK Music recognises that there is a strategy
to prioritise emerging markets and large infrastructure projects
or major contracts. However this will not deliver export growth
in our sector. Our industry, which is made up of mainly micro
and small businesses, has asked that in a climate of limited resources
that UKTI focus on established markets where firms can guarantee
returns. In emerging markets, we would urge Government to support
the development of strong IP frameworks. This will provide the
base from which music exports can subsequently develop.
11. UKTI and the Music Industry have worked together
effectively to maximise the value of their investment. They have
created a collective "British Music @" brand which has
been used to promote British Music at trade fairs, used the collective
buying power of the industry to drive down trade fair costs, and
run pre-exporting workshops at no cost to ensure that firms accessing
support are market-ready.
12. UK Music suggests that Government benchmark
its support for creative industries with those of other nations.
For example, that France have a French Music Export Bureau with
a staff of 22 including offices in Paris, Tokyo, New York, London,
Berlin and Sao Paulo. The US has IP attachés in key territories
to champion their IP based industries.
The effectiveness of the Export Credit Guarantee
Department and the flow of trade credit
13. UK Music members have made little use of
the Export Credit Guarantee Scheme, due to our industry structure.
How other countries, similar to the UK, export to
emerging markets and what our Government could learn, if anything,
from them.
14. UK Music refers the committee to the work
done by the EU and USA to champion IP frameworks internationally,
as detailed in the written evidence provided by PRS
for Music and the BPI.
The role of the British Business Ambassadors
15. UK Music members have had little experience
of the British Business Ambassadors. However we are interested
in the Publisher's Association proposal that IP attachés
be used to champion and co-ordinate support for British IP internationally.
3 February 2011
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