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News |  01 Dec 2022 17:49 |  By Rakesh Nigam

Importance of Music Licensing in India

MUMBAI: As times change and voices grow louder, it is imperative to take a deeper look at the challenges faced by music creators and publishers.  Focus activities should also include addressing the ambiguities that leave users with a legal notice, and the reasons why music licensing is a priority today .

A 2020 report by FICCI and EY revealed that the music industry grew at 8.3% to reach a valuation of INR 1,500 Crores. By the end of the current year (2022) it is expected to scale to INR 2,000 Crores . While the numbers seem huge, a deep dive can show the scope of growth that remains untapped. For example, research by The IMI (the association of record companies) found that 70% of recorded Music in India is film-based and in South India, the ratio is further skewed, with 90% of the recorded music being film-based. With such dependence and co-existence, one may expect the numbers to be in the same range. However, in 2019, the film industry in India was valued at INR 19,100 crore.

This scenario highlights the underlying challenges being faced by the music industry, as it struggles to showcase itself as a viable growth sector to investors and potential talent. Starry-eyed artists, thanks to the disorganized nature of the industry,  often end up disillusioned. With little to show their efforts get swallowed up in the abyss of uncertainty. For people behind the camera – the songwriters, producers, composers, and publishers etc – the battle is tougher. The lack of awareness regarding platforms and rights available, leaves them vulnerable to fraud and plagiarism. In turn, this drives away many a prospective investors who are wary of the internal complications the sector may present.

The grey areas in the Indian music industry run deep and wide. One of the most concerning, yet often overlooked, such area is that of music licensing. Recent cases of disgruntled creators and interested parties have brought the issue to the forefront.

Non-profit organizations, like The Indian Performing Right Society Limited, have been aiding creators protect themselves legally for over 50 years and creating awareness about the existing copyright laws and the need for Music license acquisition for business owners. However, the messy workings of the industry makes it an uphill task.

From an outside-in perspective, the Copyright Act of 1957 should be the legal armour protecting music creators. And it does, albeit to a certain extent. Creators and Publishers can legally seek compensation for damages if they come across illegal use of their creation. While copyright infringement has been categorized as a criminal offence, there prevail multiple loopholes that continue to block its implementation. It also goes on to offer a copyright infringement opportunity for a music user as the fine print is missing. The fact that the Indian Parliament recognizes Copyright as a property right further underlines that a complex industry like music needs customized laws.

On the up-side, making business operations smooth for a commercial establishment is guaranteed for the license holder. This is because the business maintains proper compliance. These establishments too can have an upsurge in footfalls, as music creates the right ambience attracting large crowds. IPRS license acquisition, thus, ensures a win-win scenario for all involved.

IPRS, to help promote business goes the extra mile to make license acquisition a simple online procedure. A visit to the official IPRS website offers clear directions for license acquisition for live or public performances and also for specific business needs. The thin line separating the legal and illegal makes it easy for plagiarists to use lyrics, melodies, and other aspects of a music piece without the fear of repercussions. Unfortunately, the absence of strong consequences has further emboldened copyright abusers making copyright abuse rampant. While the rules and regulations drafted support creators and artists at every stage, active participation of industry players and government bodies is needed to see it coming to fruition. 

Another key finding from the FICCI and EY report in 2020 was the changing music consumption pattern in India. 97% of the users in the country consumed music through smartphones. The report also found that 62% of the consumers used social media sites or apps to listen to music or watch music videos. Their 2022 report brought to light the reign of digital media, which has  established itself as the second largest segment with a growth of INR 6,800 Crore in 2021. 

As the music industry grows, new digital platforms and mediums are gaining popularity and the use of new technology has led to a tectonic shift in music consumption. Advertisement-backed or subscription-based music download has made it easy to listen to music on-the-go. Instagram Reels, Moj videos, and YouTube shorts, all rely heavily on trending music.

The prodigious rise in Digital Collections, as indicated by the CISAC Global Collections Report 2022* is a clear indicator of the tidings for the music industry. The 2 year pandemic has ensured that streaming becomes the largest income source in the music business, especially in the Asia-Pacific region. The compelling figures tell a story as Digital Collections rose by 27.9% globally to reach EUR 3.12 bn in 2021 and swept  32.6% of the total global collections- a meteoric surge of 49.1% since 2019.

*CISAC Global Collections Report captures the revenues collected by authors collecting societies worldwide catering to the music publishing side of the music business.

This, though, has added a plethora of complexities to the existing intricate path toward legal use of music in India. As an example, it is legal to use pre-fed music for personal use on platforms like Instagram and YouTube. However, as a content creator, by downloading a music piece separately and attaching it to the content you plan to monetize without legal approval, you commit copyright infringement. Even commercial establishments need to comb through the clauses of copyright to ensure that the music they are playing is legally in the clear.

A song is the culmination of the creative energies of a motley crew of creators and artists and not just an individual effort.

It is disheartening to see ones efforts being used without consent. Coupled with the loss of potential revenue creator incurs it is indeed sorrowful. To ensure the growth of the industry and preserving music talent, a legal framework customized to the need of the music industry sans ambiguity that enables Copyright infringement is needed. Till such time that this becomes a reality, a more stringent outlook and stricter compliance with the use of licensed music across platforms is inescapable.

(About Author: Rakesh Nigam, CEO of IPRS)