The biggest challenge faced by the collective management of music rights in Brazil is the adverse political environment. The final report of the Special Senate Inquiry Committee (CPI) published in 2012 contained a proposal for legislative reform radically changing the system in force. The resulting bill was sent to the analysis of the Senate’s Constitution and Justice Committee in February 2013. In June 2013 the text of the legislative proposal originally published was modified in its essence and with no further notice or analysis by those to be impacted with the changes, the bill was approved by the Congress in two weeks’ time.
The new rule (12.853/2013) has been in force since December 2013, pending a Decree to regulate its application. The Ministry of Culture has called a working group to analyze and prepare the final text of the Decree.
UBC has addressed to the Supreme Court a request of analysis of the new bill in light of constitutional principles, claiming that the new bill undermines author’s exclusive rights and challenges other fundamental constitutional guarantees. Decision is pending and the issue won’t be solved before August.
Despite this political scenario, in 2013 UBC managed to increase the distribution of performing rights in 88% compared to 2012. The collection of mechanical rights also represented a major increase of 44%.
The growth experienced in the distribution of performing rights is due especially to the celebration of settlements with TV Globo and Sky bringing in extra income of R$ 500 million to the Central Office. Out of the amount paid in 2013 by Ecad, more than 40% was UBC’s repertoire (domestic and international).
The total amount of royalties for copyrights and neighboring rights collected by the Central Office for Collection and Distribution (ECAD) was R$ 1.190 billion. The growth was significantly larger in comparison to 2012, when the collection amounted R$ 624.6 million.
The growth experienced (90.5%) was due to the settlement of two judicial disputes with TV Globo, one of the largest broadcasters and media group in Latin America and with Pay-TV operator, SKY. The radio and TV broadcasters segment was responsible for 68.2% of the total amount collected by Ecad. Therefore, we are prepared for a decrease in the collection numbers in 2014.
Distribution of royalties (author’s rights + neighboring rights) for public performance in 2013 grew 88% compared with 2012.
UBC distributed R$ 322.12 million to 77,255 local and foreign rightholders.
Performance rights of musical works and recordings in Brazil (in millions of R$)
The amounts received by UBC from abroad grew by 21%. Most of the income received (88%) referred to public performance of musical works, while 4% was received for mechanical reproduction rights and 7% for neighboring rights.
Europe accounted for 58.4% of the public performance amount received from abroad in 2013, North America accounted for 23.2% and South America for 8.6%.
Mechanical and performance rights of musical works and recordings in foreign countries – in millions of R$
The amounts received by UBC from abroad grew by 21%. Most of the income received (88%) referred to public performance of musical works, while 4% was received for mechanical reproduction rights and 7% for neighboring rights.
Europe accounted for 58.4% of the public performance amount received from abroad in 2013, North America accounted for 23.2% and South America for 8.6%.
Analysing the figures considering local (amount paid in Brazil) and foreign (amount exported) rightsholders, we conclude that:
(Ecad) authors + publishers + performers + producers
(Ecad) Authors + Publishers
(Ecad) Performers + Producers
If we analyze figures considering repertoire, instead of rightholders, we conclude that:
(Ecad) Authors + Publishers + Performers + Producers
(Ecad) Authors + Publishers
(Ecad) Performers + Producers
This is the fifth year of activity in the mechanical rights segment and the amounts collected both nationally and abroad increased 44% in comparison to 2012, totaling R$ 391 thousands.
This growth reflects new representation agreements for international repertoires: Sacem and Siae. It also reflects an increase in membership in the mechanical rights category and our focus on processing sales reports provided by digital services, specifically iTunes. We have developed the necessary technology to analyze the iTunes sales report data and issue relevant invoices, a process which has already been done for sales covering the first five months of 2012 (Apple started iTunes music store activities in Brazil in January 2012).
The capacity to automatically identify UBC’s repertoire in the sales reports has allowed us to decrease the processing time, meaning that probably we will be successful in continuously increasing results in online business.
The process has now been streamlined enough to allow faster and thorough identification of repertoire for the remaining files, allowing us to "catch up" with current sales reports. With the scale of repertoire involved, it is only natural that a reasonable number of overclaims have surfaced. We have worked together with local publishers, sub-publishers and foreign societies to solve as many cases as possible in a timely manner.
The technology developed for the invoicing of iTunes sales reports will also be beneficial for the analysis and invoicing veral new contracts UBC has finished during 2013, including major services like Rdio, Nokia, Deezer and Spotify, so we expect the online collections and distribution figures to keep their upward trend in the following year and beyond.
In thousands of R$
UBC’s communications strategy is based on a two-pronged approach: first, we proactively disseminate information on our distribution procedures keeping up with our transparency commitment, raising awareness on author rights and promoting knowledge. We are also prepared, however, to react and respond to specific issues as they arise.
A global major trend, social media, has been a growing focus for UBC’s Communication and Artistic and Repertoire teams, proving to be a highly effective, cost-efficient means of communication with current and potential members. Over the year of 2013 UBC’s reach on Facebook has nearly doubled outpacing that of the competition. UBC’s Youtube channel was created and a tutorial on how to use the software to create ISRCs (International Standard Recording Codes) was the most shared and viewed item.
In 2013, a booklet was produced with important information to our members about the management of their rights: “The Member Guide”. The print run of our quarterly magazine “Revista UBC” was increased to 5.300 units and we also experienced an increase on the number of online views of its content.
UBC also promoted and took part in seminars throughout the year. The last seminar was streamed live and experienced an audience of 700 online viewers.
Another successful initiative on 2013 was the 2nd Academic Works on Author Rights Contest. The winners will be announced in 2014.
UBC keeps its members and society well informed through its website, magazine, newsletter as well as the social media channels such as YouTube, Facebook and Twitter, which are updated daily with distribution and collection rules, important industry happenings, articles on our members’ achievements and other relevant information.
The independent auditor Audilink & Cia. Auditores reviewed UBC’s financial statements and issued the following statement:
“In our opinion, the above-referred accounting statements present fairly, in all material aspects, the equity and financial position of UNIÃO BRASILEIRA DE COMPOSITORES on December 31, 2012, as well as the result of its operations and its cash flows for the year ended on that date, according to the accounting practices adopted in Brazil.”
The independent auditor Audilink & Cia. Auditores reviewed UBC’s financial statements and issued the following statement:
“In our opinion, the above-referred accounting statements present fairly, in all material aspects, the equity and financial position of UNIÃO BRASILEIRA DE COMPOSITORES on December 31, 2012, as well as the result of its operations and its cash flows for the year ended on that date, according to the accounting practices adopted in Brazil.”
The independent auditor Audilink & Cia. Auditores reviewed UBC’s financial statements and issued the following statement:
“In our opinion, the above-referred accounting statements present fairly, in all material aspects, the equity and financial position of UNIÃO BRASILEIRA DE COMPOSITORES on December 31, 2012, as well as the result of its operations and its cash flows for the year ended on that date, according to the accounting practices adopted in Brazil.”
The independent auditor Audilink & Cia. Auditores reviewed UBC’s financial statements and issued the following statement:
“In our opinion, the above-referred accounting statements present fairly, in all material aspects, the equity and financial position of UNIÃO BRASILEIRA DE COMPOSITORES on December 31, 2012, as well as the result of its operations and its cash flows for the year ended on that date, according to the accounting practices adopted in Brazil.”
The independent auditor Audilink & Cia. Auditores reviewed UBC’s financial statements and issued the following statement:
“In our opinion, the above-referred accounting statements present fairly, in all material aspects, the equity and financial position of UNIÃO BRASILEIRA DE COMPOSITORES on December 31, 2012, as well as the result of its operations and its cash flows for the year ended on that date, according to the accounting practices adopted in Brazil.”
THE ANNUAL REPORT IS A YEARLY PUBLICATION OF THE BRAZILIAN UNION OF COMPOSERS.
BOARD OF DIRECTORS Fernando Brant (President) | Abel Silva | Aloysio Reis | José Antônio Perdomo | Manoel Nenzinho Pinto | Ronaldo Bastos | Sandra de Sá
EXECUTIVE DIRECTOR Marisa Gandelman
TEXTS AND EDITORIAL COORDINATION Elisa Eisenlohr
DESIGN AND PAGINATION Di-vida Design
