German collection society GEMA increased its revenues by 5% last year to hit €1.074bn.
That’s up 5%, or nearly €50 million from 2016 thanks in part to a rise in income from the public performance of music, radio and TV, as well as a payment for the so called ‘iPhone tax’.
That 5% represents a slowdown in growth from 2016, when revenues jumped 15% – but that number was flattered by a big-money a settlement with YouTube.
GEMA membership was also slightly up last year—the PRO added 2,000 members to reach 72k, and it represents more than 2 million rights holders globally.
Income derived from sound recordings dropped 8% to €96.1m in 2017, dipping below the €100m threshold for the first time.
Meanwhile, GEMA’s digital revenue (‘from the use of music online’) declined 16% to €70m from €81.6m.
This was at least in part because, in 2016, digital revenues were boosted by retrospective licence payments from YouTube that date back to 2009 – the product of a settlement towards the end of that year.
Putting 2016’s one off payment aside, GEMA says last year’s online revenues are “a result of the positive market trends.”
The highest earning category of revenue tracked by GEMA was for the public performance of music, which reached €380.5m in 2017, up 2.8% year-on-year.
Radio and TV came next with €294.2m – a rise of 2.8%.
A payment from the German collection agency for private copyright rights for the ‘iPhone tax’ – levies placed on smartphones and tablets paid to GEMA thanks to an expanded agreement with the Zentralstelle für private Vervielfältigungsrechte (Central Collection Agency for private copying rights, ZPÜ) — also boosted revenues.
Last year, GEMA’s costs amounted to 15% of revenue, which is down for the third year in a row after hitting 16.3% in 2015 and 15.4% in 2016.
“GEMA could continue its successful economic path in 2017,” said GEMA CEO Dr Harald Heker. “We are very content that we were able to boost our revenues by another 5% after an already successful financial year 2016.
“Licence collections for composers and lyricists as well as for their publishers do not just reflect an equitable remuneration for the exploitation of their works – they also act as the necessary basis for artistic freedom which ensures music diversity in all of its facets.”
While celebrating the results, Heker also called on politicians to fix the so-called ‘value gap’. He continued: “Our satisfying overall economic trend is evidence that we are successful if we pursue our objectives and goals tenaciously.
“the rapid change in terms of music usage continues to throw immense challenges at the value chain with regards to a comprehensive music exploitation and the protection of the interests of all authors.”
dr harald heker, gema
“It should, however, not belie the fact that the rapid change in terms of music usage continues to throw immense challenges at the value chain with regards to a comprehensive music exploitation and the protection of the interests of all authors.
“The continued debate about the modernisation of copyright shows that politicians find it hard to transfer well-established fundamental rights positions of the analogous world to the online world: There is a continued lack of a range of determining legal bases in Germany and Europe.
“It is the music creators that have to suffer the consequences, since it is them who are cheated out of an adequate payment for their efforts.
“There is an urgent need for action. After years of discussion, a copyright law which does justice to the digital transformation in the music business and which takes the rights of authors in a digital world adequately into account, must now become part of our legislation.”
Putting GEMA’s results into perspective, the German recorded music market was slightly down by 0.3% last year to reach €1.588bn, according to recently-released numbers from trade body BVMI.Music Business Worldwide