YEAR IN REVIEW Australian industry based on a strong THE YEAR IN REVIEW – vision to become a globally recognised music nation powerhouse. MESSAGE FROM CHIEF Financial Overview A record year for APRA AMCOS with group EXECUTIVE DEAN ORMSTON revenue breaking the $400m milestone, Brett Cottle AM retired as CEO in June 2018 after 28 rising by 8.7% from $386.7m to $420.2m, an years presiding over a period of extraordinary increase of $33.5m on the back of continued change and growth for the organisation. Over strong growth in consumer demand for music the past 6 months there have been many delivered digitally. ‘farewell’ events and acknowledgements For APRA, gross collections rose by 10.4% to of Brett’s contribution to APRA AMCOS, $323.3m (excluding AMCOS management the wider rights management and fees), while AMCOS revenue rose 3.3% to music industries, both locally and $95.9m. internationally. I would like to add my Operating expenses across the group – personal further thanks to Brett for comprising APRA pro forma costs, system being a leader unparalleled, and a development related costs, costs of generous mentor. administering AMCOS and stand-alone This year’s report highlights the AMCOS costs – were $57.1m, up 13.1% strength of the organisation’s from last year’s figure of $50.5m. economic performance, breadth of Despite the increased system member service, and commitment to development spend APRA Net improving our industry’s ecosystem. Distributable Revenue – the amount Critical to the health of our sector is available for distribution to a direct conversation and relationship members and affiliated societies – with Federal and State governments. grew by 9.5% to $276.4m. Our message is simple, the contemporary The group’s overall expense to music industry is one of ’s most revenue ratio was 13.6%, an dynamic and innovative industries with increase on last year’s 13.1%, well barely realised export potential. We need within a range of international bipartisan and cross-portfolio support and competitiveness and high investment in realising the potential of the economic return to our members.

Photo: Jacquie Manning 2 Contributing Factors Future Priorities For the first time, digital services licensing income became In July 2018 we welcomed our 100,000th member. Our future success the leading source of revenue for the Group, albeit with a will rest on our ability to provide world’s best service to our , margin of $1.9m, grossing $134.5m. Digital revenue has been composer and publisher members, and our licensee clients. We intend to be impressive with 31.9% year-on-year revenue growth from the business partner of choice for our writer and publisher members - from audio streaming services, and 30.4% in video on demand local to global, live to digital. (VOD) revenue. The immediate priorities for the organisation are the commissioning of Licence fee collections from broadcasters (radio and television, our new operational system, CLEF, and launching OneMusic Australia in free and subscription) remains strong, at $132.6m, up mid-2019. OneMusic Australia will build on the ground-breaking success marginally from the 2017 result primarily due to the reversal of of OneMusic New Zealand – now going into its sixth year - offering a joint the provision against Network Ten whilst under administration, licence with the record industry under one umbrella and delivering a simple and reversed due to the eventual sale to CBS in the financial and effective licensing service. In addition to a better service for licensees year under review. we forecast considerably increased market penetration and return for our Our Australian and New Zealand General Licensing teams members over coming years. eclipsed the previous year’s impressive performance with More immediately we have begun renegotiations of some of our major 10.4% growth in revenue. Revenue from and Events industry agreements in Australia and New Zealand, including free-to-air increased 24%. television, Pay TV, YouTube and New Zealand commercial radio. We will International revenue was slightly ahead of last year at lodge our application for reauthorisation with the ACCC in December this $43.7m, reflecting the continued success of Australian and year, with the objective of securing at least a three year authorisation, New Zealand on the global stage. We’re there effective 1 July 2019. to support and amplify that international impact for our With a clear view on the longer term, we will continue to take an industry members, with represenntatives on the ground in LA, Nashville lead on key issues that impact the music ecosystem. Importantly we and ; and we’ve recently launched creative and will continue our work on issues and opportunities, including; addressing business spaces for members travelling or relocating to these gender parity and diversity; local content; live music; music education; and songwriting hot spots. ensuring the strength of the copyright framework and our members’ right to APRA AMCOS’ multi-territory licensing of digital services equitable remuneration. on behalf of a number of publishers, and now the Swedish We have recently lodged our submission to the Federal Government’s society STIM, continues to be extraordinarily successful, and Inquiry into the Australian Music Industry, which provides an opportunity is indicative of our regional leadership and ability to provide to articulate to a cross government portfolio audience the issues and world’s best service. opportunities referenced above. In New Zealand we will submit to the In the year under review, expenses totaling $6.4m have been current review of copyright law and look to support the New Zealand incurred by the group on CLEF, our transformational system Government’s desire to exponentially grow the domestic music industry. re-development project – comprising the costs of internal We are well positioned as one of the world’s leading copyright management personnel and payments to the system developer, Accenture. organisations. I am honoured and excited to have the opportunity to lead The system is due to be commissioned in 2019 with the launch APRA AMCOS and a team that is focused on world’s best service delivery. of OneMusic Australia. 3 4 DIGITAL REVENUE REMAINS ROBUST Income from digital sources accounted for a staggering $134.5m, with robust growth continuing across the medium’s content categories: audio streaming, video-on-demand, and websites and User Generated Content (UGC). • Nearly one-third of all 2017-18 revenue • 21.9% more than the previous year • Digital growth outstripping physical sales decline

Where to from here? With a current figure of 4.5m subscribers to paid services, growth potential of upwards of 90% household penetration across 10m households in Australia and New Zealand is plausible when compared to the historical uptake of TV and telephones. Facebook: a game-changing revenue stream APRA AMCOS’ landmark licensing agreement with Facebook will see Australian, New Zealand and international songwriters, composers and music publishers remunerated for the use of their music on Facebook, Instagram, Oculus, and Messenger. Whether a band releases their own music clip natively on Facebook, teases new music on Instagram, or a fan posts a video singing along to , the rightsholders will potentially earn from that use.

5 LIVE MUSIC REVENUE Major international tours raise the profile and generate significant royalties for Australasian songwriters. Highlights from the past year include: ’s extensive Australasian national tour took them from Alice Springs to to Hobart to Hanging Rock and beyond, and they had 22 Aussie and Kiwi supports along the way including , A.B. Original, Adalita, Irrunytju Band, The Nudge and many more.

Ed Sheeran had as the major support on all Australian dates, and invited recent high school graduate Fergus James and along for opening slots. In NZ, Ed selected Mitch James, Six60, Drax Project, and Lost Bird. Foo Fighters - Ayn Randy, Cosmic Kahuna, Amyl and The Sniffers, DZ Deathrays, , Clowns The Killers – Alex Cameron, Jack Ladder & The Dreamlanders Robbie Williams – Tami Neilson, The Bamboos Elton John – SIA – , Theia Harry Styles – Maddy Jane, The Preatures Imagine Dragons – Queens of the Stone Age – The Lonely Boys, Ecca Vandal, C.W. Stoneking The National – Tiny Ruins Prophets of Rage – Alien Weaponry, Bare Bones, Dead Letter Circus Grace Jones - Estere, Silentjay & Jace XL

Photo: Yana Amur 6 APRA AMCOS REVENUE BREAKDOWN 2017/18 VS 2016/17

% 2018

7 ONEMUSIC AUSTRALIA • OneMusic Australia is scheduled to go live mid 2019 after two years of consultation. • ONE metric of measuring music use per sector. ONE renewal date. ONE licence. ONE payment. E-commerce option. • 25 new schemes will launch, across most industry sectors. • APRA AMCOS will operate OneMusic Australia under a joint management committee of APRA AMCOS and PPCA executives. • PPCA and APRA AMCOS have agreed on how the revenue should be split - generally 50:50. • 160,000 businesses to re-license across FY 2020 plus maintain normal new business licensing. • We will collect on rights that have always been owing to us, close loop holes and over time increase our market penetration. • Business who are now unlicensed for one right or under-licensed will find it easier to regularise their coverage to ensure they are properly licensed for the music they use. • A win-win for everyone involved in the value chain. Disappointing that some sectors have taken this as an opportunity to attack the rights of creators and attempt to wind back licence fees. ONEMUSIC NEW ZEALAND • OneMusic revenue growth enabled higher APRA and Recorded Music NZ distributions to their stakeholders. • Hospitality and exercise industries remain steady - significant contributors to revenue for OneMusic New Zealand. • Christchurch building boom, business is more buoyant. • Efficient small business geographic focus to license every business in every street in a suburb and closely work with local business associations. • Creation of a Hotel/Accommodation licence, consolidate several to one licence.

8 *

*In July 2018, we surpassed 100,000 APRA members

9 APRA MEMBERS BY RESIDENCE

10 APRA International INTERNATIONAL creative spaces in LA, Nashville REVENUE DOUBLES and London Dedicated work and IN PAST 5 YEARS creative space was launched earlier this year in the heart of LA, Nashville Factors to all of this: Overseas performance reports and London, where filed by year reflects rise in international reps A democratised online media are already firmly landscape means key music Spotify launched international touring established. With outlets (Pitchfork, Popjustice, in Australasia as more members , et al) could reach streaming begins to heading to the world’s most competitive tastemakers and keen fans make a commercial CY2012 anywhere at the same time impact worldwide creative hubs, APRA 2009 2,845 AMCOS is committed 2000s 2012 to travelling with SOUNDS AUSTRALIA members every step created to formally CY2017 of the way. support export of 7,095 Australian music

SOUNDS AUSTRALIA: NZ MEMBERS INTERNATIONAL TOURING: • 183 artists/bands showcased under the SOUNDS AUSTRALIA • 68 date international tour for Katchafire’s 20th anniversary banner at 18 international market events • 13 sold out UK shows for Flight of the Conchords • 20 showcases produced • 8 European tour date support slot for Drax Project opening for • 15 business networking events Camilla Cabello • 25 panel speaking opportunities • 8 European Festival dates for Alien Weaponry

11 AUSSIES AND KIWIS ON THE GLOBAL STAGE

One of the things I really noticed this year at South-By is it was the year of Australia. Katie Presley, NPR Music

12 Woodes. Photo: Andy Hatton

“I’m a solo, independent THE NEXT WAVE OF artist but I so relish the opportunity to collaborate INTERNATIONAL and work on new ideas with other artists. I have HITMAKERS co-written some really special songs at SongHubs From Angel Tupai, who co-penned Denmark’s 2017 and thanks in part to those Eurovision entry, which was performed for a worldwide experiences, my songwriting TV audience of 180 million, to Elle Graham who and producing work is performs as Woodes, and is clocking up streams in the connecting with music fans millions for her own songs and collaborations with internationally.” other artists, the future of songwriting is bright. ELLE GRAHAM / WOODES

ANGEL TUPAI

I co-wrote ‘Where I Am’ in Australia for Denmark’s Eurovision entry and it went out to the world. Songwriting connects people in a way nothing else does, and the international royalties I earned validate all the hard work along the way and encourage me to keep pursuing my creative goals.

13 At the end of July last year, APRA AMCOS shared Dr. Catherine Strong’s commissioned research OUR GENDER on (the lack of) female screen composers in the Australian music industry. On the back of that we DIVERSITY made a firm commitment to address the gender imbalance in our membership ranks, across our INITIATIVE, programs and initiatives, and called upon the industry at large to work together to tackle gender disparity. ONE YEAR How far have we come in one year? Let’s reflect. LATER I think it’s really important to identify those women who feel a little bit on the outside and bring them together and offer them support in getting to the next stage of whatever it is their goals are, whatever level they are at. DEMI LOUISE

Female mentoring participant Demi Louise, at SongHubs . Photo: Yana Amur

14 ACTIONS: Goal of 25 per cent increase in new female members YOY over three years

1st full year resulted Of new members, Overall member in a 16% increase in 72% identified as Male, gender split: new female members 26.8% as Female, and 77.5% Male, compared to previous 1.2% didn’t specify a 22.5% Female 12 months. gender.

Strict 40 per cent female participation measures Mentorship program The 40/40/20 measure requires at least 40% without exceeding 60% APRA AMCOS has initiated and partnered with a number representation of any gender in APRA AMCOS activities. of organisations in the past year to provide support to female mentoring programs across musical fields and Female Progress Report genres. Participation Judges 38% The goal of the program is to encourage professional growth. “There are significant numbers of female Ambassadors 36% songwriters and composers who are at a point where, SongMakers mentors 40% with some meaningful professional guidance, they can SongHubs participants 40% continue to build their career,” said Head of Member Performers at APRA Art Music Awards 49% Services Jana Gibson. Performers at APRA Screen Music Awards 50% The numbers: Performers at APRA Music Awards 50% Performers at Silver Scroll Awards 67% • 7 mentor programs Awards presenters 50% • 15 mentees National event speakers 40% • 550+ applicants Now in effect: APRA Music Grants supporting external programs are strictly allocated to grant applications showing at least 40 per cent female participation, or a commitment to tackling gender disparity, where possible.

15 Mentoring program outcomes include: • Bri Clark supporting her mentor Mark Lizotte () on 3 WA tour dates • Larissa Agosti commissioned to compose music for an Australian prime time television program • Demi Louise engaged for songwriting work with Sony/ATV Music Publishing • Mookhi made new contacts with brands and industry connections via KLP • Composing Women: The Symphony Orchestra Fellows performed new work by the four program participants on 12 Oct • The Summer’s Night Project – concerts with music by composer mentees took place in WA, SA, VIC

There’s an abundance of amazing female talent seeking pathways into the music business so it’s great that APRA is taking a leadership role in helping remove some of the obstacles that they face. Mentoring programs are obviously just one small step but hopefully their The future’s exciting but I don’t impact can be much more than symbolic think we can be at all complacent. JOHN WATSON Pop/Contemporary program mentor Composing women mentor

Bri Clarke participating at SongHubs BIGSOUND. Photo: Bobby Rein

16 SONGHUBS SPHERE To celebrate 125 years since New Zealand became the first country in the world to give women the right to vote, a unique SongHubs event called SongHubs Sphere was created exclusively for female-identifying and non-binary songwriters, producers and audio engineers. Legendary US engineer and producer Susan Rogers (Berklee College of Music, Boston) joined Ebonie Smith (Atlantic Records, NYC), Laura Bettinson (London) and Wendy Wang (LA) to collaborate with 15 New Zealand and Australian songwriter writers and producers at Neil Finn’s Roundhead Studios.

Susan Rogers (right) works with SongHubs Sphere participants Anna Coddington & Shana Llorando. Photo: Amanda Ratcliffe

17 APRA is lauded the world over as the best of the best collection societies. We have a point of difference from the rest of the world that also exists in our music makers and I would urge you to keep tapping into that. When you’re doing your co-writes or sitting alone in your writing world, remember the importance of keeping your unique essence. Wherever you may roam, carry your mauri ora with you. Keep the connection! Hall of Fame acceptance speech, 2018

New Zealand Prime Minister Jacinda Ardern inducted Chair of the APRA Board Jenny Morris into the NZ Music Hall of Fame – and Marlon Williams won the Silver Scroll for “Nobody Gets What They Want Anymore” – at the 2018 APRA Silver Scroll Awards in Auckland.

18 Fill in the blank: SONGMAKERS Where does the next wave of Aussie hit-makers come from?

BRINGS THE MUSIC A: Anywhere What is the program for secondary students who INDUSTRY INTO want to learn about the contemporary music industry?

THE CLASSROOM A: SongMakers

Since 2013, APRA AMCOS’ SongMakers program has been bringing the music industry into the classroom in the form of a two-day intensive workshop, where students work collaboratively to write, produce and record a song against the clock, under real world conditions, and they learn about industry fundamentals along the way. It’s creative, vocational and there is really nothing else like it in Australian schools. The numbers: • 25 mentors (including KLP, , Jean-Paul Fung, Rai Thistlethwayte, Anna Laverty, Milan Ring and more) • 420 days of workshops • 206 high schools • 3,500 students have produced over 800 songs

19 THE SONGMAKERS MAKING THINGS HAPPEN

SongMakers gives school students a unique opportunity to work and connect with music professionals. There’s a lot to learn not only from their musical expertise but also from their experience of working in and navigating through the music business, and that sort of knowledge is priceless for somebody looking to build a career in music. Taka attended SongMakers as a student at Canberra’s Narrabundah College and is now a full-time songwriter, producer and mix engineer, TIA and working on his own artist project. Upcoming singles include releases for Max Frost (Atlantic Records) and Cyrus (Sony Records). GOSTELOW SongMakers was a great TAKA experience, it definitely pushed me out of my comfort zone PERRY allowing me to topline for other artists and I really enjoyed it. I also met and worked with SongMakers taught me the value of collaborating with a lot of artists and producers other musicians and the importance of being confident in that I’ve been wanting to expressing my ideas in co-writing. I learnt that you don’t collaborate with for a while now have to stick to just one style; that co-writing can be limitless and it allowed me to build new when you allow yourself to be versatile in the genres of your relationships. fellow co-writers. Tia’s solo debut album Thick Skin was triple j feature album, she is signed to Native Tongue Publishing, and will be performing at Falls HANNAH ROBINSON Festival. She did SongMakers as a student at St. Patrick’s in Mackay in 2015, and again the next Hannah attended SongMakers as a student at Newtown Performing Arts High School. She is year as the first winner of triple j’s Unearthed pursuing a career as a songwriter and musician under the pseudonym, Harley Mavis, and will High indigenous initiative. be releasing her second single at the end of October.

20 NEW ZEALAND IN FOCUS New Zealand’s music industry is continuing to grow alongside Australia’s, and APRA AMCOS and OneMusic have been working hard to return the benefits of this industry growth to our members. Through our Music Grants Program and Professional Development Awards, we offered more than $140,000 of support to 30 organisations and individuals in 2018, including the NZ Music Foundation, Play It Strange, SOUNZ, Rockquest, the Music Managers’ Forum, the Screen Composers’ Guild, Kiwi Kids Music and the NZ Songwriters’ Trust. Through our SongHubs Program, we brought seven international guests to New Zealand to collaborate with 27 of our members, resulting in the creation of 40 songs.

Mirroring the process that’s recently taken place in Australia, the New Zealand Government is currently reviewing the Copyright Act which is the legislation that protects the work our members create and enables them to be paid for the use of their music. We’re working alongside other music industry organisations to advocate for the importance of strong copyright protection for our members’ work in an increasingly vast – and rapidly transforming – global landscape. Earlier this year, the New Zealand Government also announced a Music Industry Review which gives us an opportunity to communicate the current interests and changing needs of our members, the enormous value they add to our culture and economy, and the ways in which they can be better supported and empowered to succeed and sustain careers.

Teeks performs the Maioha winning song ‘Te Ahi Kai Pō’ – written by Ria Hall, Te Ori Paki & Tiki Taane – with Nick Dow and Ngā Tūmanako kapa haka group at the 2018 APRA Silver Scrolls

21 ADVOCATING FOR MEMBERS’ RIGHTS APRA AMCOS takes a strategic approach to advocacy and this year increased its resources in this space by appointing a dedicated Director of Public Affairs. One of APRA AMCOS’ central roles as a member based association is to advocate on behalf of its members. We work tirelessly to present Australian and New Zealand governments with evidence driven arguments for a regulatory setting that supports our membership and the cultural and economic contribution the music industry makes to our region.

This year APRA AMCOS’ advocacy efforts focussed primarily on the following areas: • Protecting creators’ rights – we continued to advocate against the introduction of new, broad and uncertain exceptions to copyright protection (such as a “fair use exception”) which erode the ability of APRA AMCOS members to make a living from their creative works. • Safe harbours – we successfully persuaded the not to extend our existing “copyright safe harbour scheme” to protect commercial online services generally and instead limit protection to educational, cultural and other non-profit institutions. • Local content – we appeared before a Senate Inquiry into the value of local content and argued for clearer and stronger quotas for local music on commercial radio and an agreed benchmark for local music on streaming services’ locally curated playlists.

Photo: Ricky Lloyd 22 APRA AMCOS revenue growth over the last 5 years trounces even the much publicised balloon in apartment construction in Australia.

*IBISWorld Industry Report E3019. September 2018. Multi-Unit Apartment and Townhouse Construction in Australia.

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