Remuneration of authors and performers for the use of their works and the fixations of their performances FINAL REPORT A study prepared for the European Commission DG Communications Networks, Content & Technology by: Digital Agenda for Europe This study was carried out for the European Commission by Europe Economics and Lucie Guibault, Olivia Salamanca and Stef van Gompel of the University of Amsterdam Internal identification Contract number: MARKT/2013/080/D SMART 2015/0093 DISCLAIMER By the European Commission, Directorate-General of Communications Networks, Content & Technology. The information and views set out in this publication are those of the author(s) and do not necessarily reflect the official opinion of the Commission. The Commission does not guarantee the accuracy of the data included in this study. Neither the Commission nor any person acting on the Commission’s behalf may be held responsible for the use which may be made of the information contained therein. ISBN 978-92-79-47162-9 DOI:10.2759/834167 © European Union, 2015. All rights reserved. Certain parts are licensed under conditions to the EU. Reproduction is authorised provided the source is acknowledged. Contents Abstract .................................................................................................................................................................................. 1 Introduction ......................................................................................................................................................................... 2 Executive Summary ....................................................................................................................................................... 3 The current legal framework ............................................................................................................................... 3 Understanding payment flows ........................................................................................................................... 5 Analytical approach ................................................................................................................................................... 6 Statistical analysis...................................................................................................................................................... 7 Key findings .................................................................................................................................................................... 8 Policy recommendations ........................................................................................................................................ 8 Synthèse ..............................................................................................................................................................................10 Le cadre juridique actuel .....................................................................................................................................10 Comprendre les flux de paiement .................................................................................................................12 Approche analytique ...............................................................................................................................................14 L'analyse statistique ...............................................................................................................................................15 Les principales conclusions ................................................................................................................................15 Recommandations en matière de politique publique .......................................................................16 1 Introduction .............................................................................................................................................................18 1.1 Context and motivation for the study ...........................................................................................18 1.2 Objectives and scope ................................................................................................................................20 1.3 Structure of the report.............................................................................................................................21 2 The Current Legal Framework.....................................................................................................................23 2.1 Legal framework under the European acquis: overview on the nature of the rights .................................................................................................................................................................................23 2.2 Member State regulation of exploitation contracts ..............................................................32 2.3 Collective bargaining .................................................................................................................................44 2.4 What are the key legal provisions for the remuneration of authors and performers? ..................................................................................................................................................................59 3 Understanding Payment Flows ...................................................................................................................61 3.1 Overview of the music industry .........................................................................................................62 3.2 Music industry supply-chains ..............................................................................................................65 3.3 Overview of the audio-visual industry ..........................................................................................83 3.4 Supply chain of the audio-visual industry ..................................................................................88 3.5 What are the key relationships in determining remuneration for authors and performers? ............................................................................................................................................................... 101 4 Analytical Approach ......................................................................................................................................... 103 4.1 Development of theoretical framework ..................................................................................... 103 4.2 Expected values, risk sharing and incentives ....................................................................... 104 4.3 Bargaining power and expectations for contract terms ................................................. 111 4.4 The legal framework ............................................................................................................................... 116 4.5 Conclusions ................................................................................................................................................... 120 5 Approach to Statistical Analysis .............................................................................................................. 122 5.1 Data collection ............................................................................................................................................ 122 5.2 Characteristics of survey respondents ....................................................................................... 123 5.3 Approach to statistical analysis ...................................................................................................... 126 5.4 Approach to econometric analysis ................................................................................................ 127 5.5 Summary of statistical and econometric analysis .............................................................. 130 5.6 Data weaknesses and the treatment of statistical and econometric analyses in this report ................................................................................................................................................................... 132 6 Policy Recommendations ............................................................................................................................. 135 6.1 Key findings .................................................................................................................................................. 135 6.2 Policy options .............................................................................................................................................. 142 6.3 Recommendations ................................................................................................................................... 156 Appendices ...................................................................................................................................................................... 158 7 Appendix 1: Music Industry ....................................................................................................................... 159 7.1 Overview of the music industry ...................................................................................................... 159 7.2 Alternative cases......................................................................................................................................