Will Copyright Law Modification Break Down Recording Industry?

—digest of Sohu Weibo interview on Exposure Draft of Copyright Law

On the invitation from the biggest web portal sohu.com, Mr. You Yunting was interviewed on sohu’s microblog for the Copyright Law exposure draft (the “Draft”), and today’s essay is the digest of the interview. And for your convenience in reading, we’ve made a few alterations to the questions and our answers.

1. Q: Is the modification of this time kind of progress or retrogress?

A: From the legislature technology, the modification is a progress while it remains problems.

2. Q: By the Draft, the music works could be used free from license when the royalty fee is paid, then what is its difference from the original regulation?

A: Actually the works are not for free-license use by the new regulation, for example, a publicized CD could only be used by other music companies for another product of the same works when the company makes a prior record. But for any intended cover by other singers, the license is demanded. Surely, the non-profit self entertainment, like the karaoke, demands no license from the copyright owner.

(There’s also another statement that it shall allow other producer to make different products)

3. Q: Why the Music Copyright Society of China is able to collect the royslty fee for the copyright owner? Is there any secret operation?

A: To collect the royalty fee for copyright owner by the collective organization is kind of convention worldwide, and the system mainly focuses on the cost decrease of the user to seek the copyright owner as well as to promote the spread of the works. However, in China, the copyright collective management organizations are incomplete, therefore it has been widely criticized and doubted for its capacity to take the royalty collection obligation nationwide.

4. Q: Could you estimate the reason why NCAC decides to modify the law?

A: We would rather comment that the modifications of this time are mostly more fitting the development of the society. But we also notice that the argument of this time concentrates on the mandatory license, more power granted to copyright collective management organization, the definition of safe harbor rule and the adaptation of the technology measures. In our opinion, however, some arguments mentioned are of no problem, like the safe harbor rule and the software technological measures, while others are more confiscated for the so-called China features. Fortunately, the professionals in the industry have expressed opinions on the modification, and we believe these suggestions will be into the NCAC’s consideration for future modification.

5. Q: In the market, are the original musicians the vulnerable group? And how’s their benefits?

A: In my opinion, in the current Draft, the music companies are most damaged, while the original musicians, with the Draft, have more right to speak rather than the vulnerable group. Originally, the music company could control their album, but by the drafted regulation, the album could be used for others for the production of the same content and performer within 3 months after the album publication, and that is a big shock to the copyright owner. While, on the other hand, the original writer by the drafted regulation could maintain the right to the lyrics and tunes, and any commercial performance by others shall first get the license from the right owner. Therefore, to our personal opinions, the status of the original musician will be lifted.

6. Q: Hong long is the copyright protection term of a music works? Could it last for the copyrighter’s life time or a fixed several years?

A: The protection term of the individual’s works will expire 50 years after his/her decease, while for the works of legal person, the term is 50 years after its first publication.

7. Q: Why there shall be the copyright? The widely spread Chinese civilization does not depend on the so-called copyright, and could the copyright protection is driven by the benefit?

A: The immortal works are all expired of their protection term. But for the works, only legal protection could contribute to their prosperity. The main functions of copyright are two: 1) to encourage the creation with the protection on the legal interests of the original writers; 2) to encourage the spread of works with the protection on the social interests. The object of both aspects is to boost the prosperity of the culture. Some statutory clauses amended this time mainly aim at the spread of the works, but unexpectedly, the argument arouses accordingly.

8. Q: What could we do for against the drafted regulation?

A: There is information feedback channel on the website of NCAC, and you may submit your opinion on it.

9. Q: Who cares the copyright? Haven’t you heard that a noted musician has chosen to sell the roast duck?

A: If everyone thinks the same like you, then there will be no guarantee on copyrighter’s income.

10. Q: What is the cover version of music? Just like Xu Ri Yang Yang, a group known for performing other’s works, or like singing in karaoke?

A: The music cover version is the commercial performance of other’s works in essence. And those self entertainment, like songs humming, singing in karaoke are both not for commercial purposes. While the charged performance in the public situation, or to communicate the recorded video or audio on the internet shall all get the license from the copyrighter first, otherwise the infringement will be established.

11. Q: What is the name of the copyright collective management organization? Is it the single management or cross management?

A: The collective management organizations are not few, as we know there include the Music Copyright Society of China, China Audio-Video Copyright Association, the Literature Copyright Society of China, the Film Copyright Society of China, etc. For more details, you may visit their official websites.

12. Q: What influence will this regulation produce on recording industry?

A: The Draft may damage the interests of music companies. Under the original system, the music company is the core of the recording industry for the songs and music are the fine arts and contains the creation of lyrics and tunes, music, singing and recording, and each phase has its own copyright, and the music company is the integrator. However, meanwhile, the confiscated process also bring the obstacle to the music license, for example, the online music shall get the license from the copyright of lyrics and tunes, music recorders and the performers, which may bring the high expenditure.

In the era of internet, to copy a pirated song may only cost several second. Facing the newly emerged internet, the music website is puzzled with Gresham’s Law. Anyone purchase the copyright may be left behind in the competition while the piracy may bring you the advantage in the music uploading time. And that makes the whole industry of music falls behind the development of the time. At this time, what shall we do is to help the recording company in transformation to find a new commercial model, for the companies make most contributions to the development of the music industry.

From the draft, we see a deadly shock to the recording companies, for on hand the most resources of album of the companies are taken away hereinafter for the publication by its competitor within 3 months after its publication, and on the other hand, to cultivate the copyright collective management organization and with such policy support, the organizations seem to have more lead in the industry. For these, we think there maybe risk in it. The collective management organizations are of incomplete system with its charge and benefit distribution system are of unclear, therefore their lead in the industry may bring the risks to the industry.

Therefore, the most proper solution is to bring the competition between the century old recording industry and the collective management organizations. While the current Draft tilts more balance to its related organizations, and that makes us feel new problems could not be avoided.

13. Q: The domestic karaoke pays the royalty or not?

A: The large-scale KTV all pay the royalty and the fees for the using of lyrics and music.

14. Q: Will the new regulation disappoint the original musician who has already trapped in a dilemma?

A: The opposition of the musicians mainly come from the following considerations: 1) anxiety to the collective management organizations, who by the Draft will lead the industry while are difficult to deal with for it’s a quango rather a private entity; 2) some regulation are less reasonable; 3) the fear to the new regulations.

15. Q: What influence may come from the drafted regulation to the recording industry?

A: By the Draft, the leader in the industry has changed to the copyright collective management organization, which is a semi-official organization; therefore the development of the recording industry is difficult to estimate.

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