GEMA: The Royalty Collecting Society That Threatens German Club Life
- 07 August 2012
MEOKO gets an insight into the legal nitty-gritty of German copyright laws and royalty disputes which sparked off a public uproar and protest marches in Berlin as the tariff reforms issued by GEMA in April threaten German nightlife.
Possibly one of the most controversial issues, the German legal situation of the copyright law, fought between the major companies Google, Youtube and GEMA, is spiced up by an additional dispute: the royalty mongers of the German collection society released statements that they are planning to introduce new tariffs which, for medium sized clubs, will see rises in charges as high as 1000 to 1400% with an additional 50% surcharge if the event takes longer than five hours. Small bars and music pubs “only” face a rise of 400 to 600%.
If their reformed and apparently “facilitated” new charging system is applied to underground electronic music events, organisers, small and medium sized clubs and independent music venues face financial disaster and closure, according to state officials from the Berlin Club Commission, which represents the nightlife industry, and spokespeople such as Loveparade-founder Dr Motte as well as Berlin politicians of all parties.
On June 25th, German club owners, clubbers and music lovers stepped up united to party, protest and rally against GEMA measures and to get people to sign petitions and on the cause, challenging the reforms and demanding more transparancy in the money collection and distribution process which is often cited as being unjust and unprecise.
Apparently, the new scheme is just as imprecise as the previous one, although it´s been enacted to simplify the tariff structure. Eleven different fees are being replaced by only two, monthly charges are being based on ticket prices and the relative size of the venue.
The case is now in the hands of the Deutsches Patent - und Markenamt (DPMA), the Federal patent office. Although there won´t be a decision reached until 2014 as the reform will take more than two years to go through the official channels, adjusted payments of royalties already have to be made available as of December 2012.
Two German state provinces, Berlin and Mecklenburg-Vorpommern, have already lodged an objection, but, if these tariff reforms go unchallenged, legendary clubs like Berghain and Watergate will close down at the end of the year as their fee hikes range between 500% and 1400%.
The Berlin press, in reaction to the heated discussions, published a string of interviews with representatives of the underground music industry which has teamed up as “Fairplay – Gemeinsam gegen GEMAinheiten”, amongst them musician and Pirate Party politician Bruno Kramm as well as Dr Motte, the initiator of Love Parade who today heads Electrocult e.V., the two of them repeatedly arguing the injustice of the distribution of GEMA payouts to members.
It was also correctly pointed out that most electronic music producers are not even members or afiliates and thus do not profit from payments at all. Another valid point is the fact that most underground electronic venues do not play music by any artist, composer or label represented by GEMA.
Accused of abusing its monopolistic power by acting as a representative of all music-making artists, the GEMA actually only represents the interests of its 3,400 core members, the upper 5%, which is made up by the who-is-who of German popular music, and receive 65% of the payments, whilst only 35% are being paid to its other 61,600 associated members.
The whole discussion opens a can of worms in which it becomes very obvious that the German royalty system is definitely not protecting the burgeoning underground scene which raises most of the revenue in the club and nightlife capital Berlin, its economy depending on its culture as the city has a notoriously high level of unemployment and its mayor industry is the party tourism.
Although club owners could recalculate their entrance fees and, by charging more, could pass on the extra costs onto their customers, most of whom are more than happy with the financial burden (if that´s what it takes to keep their favorite clubs open), this whole situation could, should and might bring about some much needed change in the calculation and distribution of royalties in Germany which could serve as an example internationally. As it stands, Germany is one of the few countries which really employs an old-fashioned yet functional system of redistribution, enabling artists to live off their intellectual property – but as it stands, it´s a system that redistributes wealth unequally.
GEMA, short for “Gesellschaft für musikalische Aufführungs- und mechanische Vervielfältigungsrechte” (German for “Society for Musical Performing and Mechanical Reproduction Rights”), is a non-governmental society founded in 1903, and played an important role during the Third Reich (as STAGMA) classifying music as “Arian” and “degenerated”. Still today, music is being classified in two categories: “entertaining” and “serious”. It would be very interesting to see more aspects reformed than just lining the pockets of those who have been generously cashing in without any state control for years. In 2010, the chairman of the board received a salary twice as high as Angela Merkel.
The Berghain OstGut GmbH state that they “categorically” reject “the new GEMA tariff structure’s price dictatorship and demand(..) the development of new, fair tariff structures in cooperation with the small and large promoters and organisers.” On their website, they ask their fans to sign the petition ‘Against the 2013 Tariff Reform – GEMA has lost its sense of perspective’, which will be sent to the German Parliament’s Petition Committee.
In total, more than 225,000 votes against the reform have already been collected.
Words: Katrin Richter
Dimitri Hegemann (Tresor label/club owner) tells MEOKO....
"The situation with GEMA is getting worse. The prequel: in the earlier years of my career I did not tire myself denouncing the unjust distribution of Money the GEMA is taking from the clubs, once and again. I am paying them, but I would like to make sure that these payments will get to those artists, componists, labels and publishers who made this music, not lining the pockets of Udo Juergens, Dieter Bohlen and Herbert Groenemeier. Like I said, I am willing to pay GEMA. My demands are: Retention of the old tariffs, gradually levelling them up by 2% if the following criteria are met. First: Fair and transparent distribution of GEMA fees paid by the clubs. The money should really get to those artists and labels whose music is being played in the club. Obviously, they can charge their 15% handling fees. Second: Transparent monitoring, because it´s technically possible, nowadays. Every song played digitally has an implanted AUDIO-ID or some meta data identification. About 96% of all tracks can be monitored that way. Registered (GEMA) clubs are all tied into a general system which collects the meta data and the amount of clicks each played track received. In this general computer system, a ranking list can be established and thus, a fair collection and distribution system. It´s really possible, as technologically, all the criteria are given. The costs are down to GEMA. Third: All GEMA money collected from clubs will be gathered on an account held in trust by a notary until all these demands are met. By the way, just thinking out loud, I have a UK car insurance, why can´t I licence my music through an English royalty collecting society? I was also thinking that in the worst case, Tresor will tell all its DJs most of which have never received any payments from GEMA at all, to cancel their membership. Those and all the other artists should just write new music, which then does not get registered with GEMA, but the copyright is still belonging to the respective artists, even if they do not register their songs through GEMA. Tresor would preferably work with DJs who will be GEMA-free, and Tresor will also comunícate this through the media. I am sure we´d be GEMA-free in no time, and could then refer from paying anything to them at all. I am quite sure they would pop around to make us an offer. Actually it´s quite realistic to make Tresor a club in which there will be no GEMA registered music. Nevertheless, dear people, if GEMA is taking these measurements, and we are all pretty sure they will get through with it, then something will happen no one in Berlin suspected. Berlin will lose its vibrant clubbing scene, and this means there won´t be much going on. Clubs will close and the party goers will fly somewhere else. This would have fatal economic consequences. If GEMA manages to successfully force through their demands, there would be a snowball effect which will tear everything down. Clubs will be doing bad, financially, some will close, others will become more expensive, the quality will suffer, the drinks will become expensive. People working in this scene will lose their jobs, the drinks companies will sell much less, EasyJet and other flight companies will stop their flights to Berlin as there will be less visitors, hostels will close, and above all, “yound wild Berlin” will lose its magic."
Cesare vs Disorder (Serialism / Label Owner / Producer & DJ tells MEOKO.....
"We were just talking about it at lunch today with Robin Drimalski from Watergate and Dave Aju. It is all a big joke and it can't be solved easily. It is exactly as it happens in politics, where big corporations have way much more powers than the entire worldwide population. In the music industry, it's the majors that have this power and they are only interested on making their pocket grow and recover from the big loss with the music industry latest changes. The problem could be solved so easily. Richie Hawtin uses a software that communicate with the major networks telling in real time what track he's playing in that exact moment. Isn't it a a kind of possible solution? But it isn't so easy."
Mark Henning - Berlin based house/techno DJ & producer, releasing music tells MEOKO......
"GEMA seem to be out of touch with reality. Their policies stiffle the independent scene and make it hard for artists and labels to survive. Look no further than their ludicrous demands of Youtube which is doing nothing but hurt the music industry. With the introduction of these venue tariffs in Germany, things are seemingly going from bad to worse. I hope that these get challenged at a high level.”
Danni Patten (Playkula) - Electronic Music Agent and Berlin Resident tells MEOKO.....
The theory of GEMA is sound, that when artists make music which is played out in clubs, they should receive money from the clubbers towards the sounds they enjoyed on their night out via a share of the club entrance fee. This is a great concept, but the issue as I see it is that GEMA does not at present sufficiently represent the underground scene which is supported by Berlin clubbers, nor the music which DJs at clubs such as Berghain and Watergate are playing. Considering the staggering increase to the current GEMA contributions at a time when many other costs are also increasing for club owners, with often unpredictable turnouts on the night, the animosity throughout our scene towards this law proposal seems justified in my view.
Isis Salvaterra - Toi Toi Promoter tells MEOKO.....
“I feel that most people in our industry, especially the non-German speakers kind of fail to be able to analyse both sides due to the lack of understanding of German laws and what exactly this change would mean in practice as in order to make this work there needs to be an entire re-structuring and not just 'club closures'. For example 'how will the money get to our artists'? Does it need a re-structuring on the way fees are paid, etc? Like, if the artist is a GEMA member, he will get paid a fixed amount which in turn will regulate our fee system and make it more fair? It covers the range from music being released to the artist performance at the club. I do not feel I can at this point comment on the pros and cons of such measure without having more in-depth knowledge. Equally we need to see how GEMA is willing to implement this in an industry such as ours. What I mean with 'our industry' is that such measure would go across the board in the music industry but electronic dance music works in an specific way, it's a niche and in many cases differ greatly from more commercial types of e-music or the more mainstream music genres. It has a different structure than the ordinary, GEMA must be willing to understand us and how we work. Our scene´s features, be it structural or financial for instance, have to be taken into consideration. The clubs and the vibrant scene found in Germany attracts people from all over the world. The money it generates in tourism to many cities is enormous and somehow it makes it hard for me to believe they are not considering those factors. It does not take a rather deeper analysis to see this will not benefit anyone if it shuts down our culture like that. Historically, Germany is Europe's techno mecca, their citizens take pride in it and they should -- its historical, social and economical impacts are too immense to be completely ignored like that. At this stage I would like to be optimistic on 'not all change is bad -- in the way that we might be able to come up with a nice solution to this 'new digital age' together, and the only way we can do that is being open to work with the authorities to achieve it."