After Tencent lifted the exclusive copyright, can "NetEase Cloud" listen to "Jay Chou"?

Yang Lin, a reporter from China Economic Weekly, | Beijing reports

The history of the Chinese music market in recent years is a history of copyright competition.

With the emergence of copyright value, "exclusive licensing" has become the key to the expansion of music platforms. In just a few years, the rising copyright fees have restructured the market structure, with fewer and fewer players and resources concentrated on a small number of head platforms.

In July, the State Administration for Market Regulation ordered Tencent to remove the exclusive copyright of online music. The industry generally believes that this will bring new changes to the online music industry.

In the recent copyright wars, who has collected those sky-high royalties? Have musicians enjoyed dividends? After Tencent lifts the exclusive license, can fans hear all the songs in one APP?

How expensive is music copyright? Jay Chou Quku licensing fee is nearly 50,000 per day?

In recent years of copyright wars, the high level of copyright fees has stunned many people.

According to public information, in 2017, Tencent Music invested 350 million US dollars and 100 million US dollars in equity to acquire universal music's 3-year music library, and a year later, NetEase Cloud Music obtained the exclusive authorization of Huayan International Music Library for 500 million yuan for 3 years.

Many music practitioners believe that the "big three" record companies – Universal, Sony, and Warner – may be the biggest winners in this war. "The exclusive sales model of the three major international record companies in China has made companies that need to buy copyrights, including NetEase Cloud Music, pay two to three times the cost of more than the reasonable price, which is unfair and unreasonable." NetEase CEO Ding Lei has publicly complained about copyright issues.

Chen Xianjiang, an observer of the music industry, said bluntly that this is actually a kind of helplessness, the domestic traditional recording industry has developed too late, and good content is concentrated in the hands of the "three majors", and they have accumulated enough.

Qin Ming, head of a senior music copyright company, revealed that the "big three" song settlement advantage is overwhelming for other domestic record companies, even if it is a high-quality copyright of high-quality songs in China, it is not as good as the prepaid "big three" in the past few years. For the exclusive copyright of the head song, the platform is willing to pay a high price.

From 2005 to 2021, the number of Chinese music websites has plummeted from more than 400 to just a few. With the closure of Shrimp Mi Music this year, Tencent's QQ Music, Kugou Music, Kuwo Music, etc., as well as NetEase Cloud Music, have become one of the few figures that still remain in the market.

The fierce competition can also be seen from the number of lawsuits involved in the platform. Taking Tencent Music Entertainment Technology (Shenzhen) Co., Ltd. (hereinafter referred to as "Tencent Music Entertainment") and Hangzhou Leyu Technology Co., Ltd., the actual operating entity of netease cloud music official website, as an example, the Tianyancha APP shows that since its establishment in 2017, Tencent Music Entertainment has involved 1386 legal proceedings and 1257 disputes involving infringement of the right of dissemination of information on the Internet of works. Since its establishment in 2014, Leyu Technology has involved 2044 legal proceedings, mainly involving disputes over the infringement of the right of dissemination of works on the information network and disputes over infringement of property rights of other works.

The two had a dispute in November 2019 over the resale of jay Chou's songs. Tencent sublicenses to NetEase, and NetEase pays a huge amount of copyright fees to Tencent. The relevant judgment revealed the details of the copyright resale of Jay Chou's songs, and the judgment showed that the Jewell Music Library (Note: Jewell Music Co., Ltd. is a personal entertainment limited company founded by Jay Chou in 2007) has about 808 songs, and from April 1, 2015 to March 31, 2018, the annual resale fee is 8.7 million yuan, 8.64 million yuan and 18.18 million yuan, respectively, calculated, the daily license fee during the authorization period is 23835 yuan / day, 23679 yuan / day, respectively. 49819 yuan / day.

Some insiders have said that the three words "Jay Chou" may mean more than 15% of the DAU (daily active users) increase. Tencent also admitted that it paid a huge copyright license royalty for obtaining the relevant copyright license of Jay Chou's songs.

However, although "Jay Chou" is expensive, in recent years, there has been no phenomenon singer like him in the Chinese music scene. Fans can't help but question whether the industry's ability to produce golden songs and star-making is not as good as before? And is this related to the copyright war?

Some people believe that the copyright war has allowed the head music (copyright) company to taste the sweetness of this cake and is unwilling to spend any more energy on music production.

Chen Xianjiang has a different view on this, he said that there are actually more and more musical works, and there are fewer good works, which is mainly a matter of overall changes in the industry. "The more money a company makes from copyright, it will definitely have to invest in the production of new content, and it is impossible to always rely on selling the previous copyright."

How much royalties do musicians get?

How much of the huge amount of royalties has gone into the hands of music creators?

In September this year, lyricist Wu Xiangfei formally sued NetEase Cloud Music, Universal and Tencent. Wu Xiangfei entered the industry in 1998, catching up with the prosperity of the Chinese music classics, but also experienced a late decline, Yu Quan's "Subway to Spring", Sun Nan's "The Sky of Fate" and other works are from his pen, he once won the Best Lyricist Award in Hong Kong and Taiwan for Eason Chan's creation of "The Road Has Always Been There".

In May, he posted on Weibo about the abuses. He wrote that Universal, without his authorization, licensed more than 10 works such as "The Road Has Always Been" to Tencent and many other platforms for 13 consecutive years from 2008 to 2021. "Tencent not only uses it itself, but also re-authorizes these songs I wrote to NetEase, and everyone uses them together."

He wrote that the royalty report provided by Universal shows that in the past five years, the total royalties that Universal intends to pay him is equivalent to 18,974 yuan. Taking Eason Chan's "The Road Has Always Been" as an example, universal is prepared to pay a songwriting fee of 271 yuan per year, an average of 22.58 yuan per month. "The point is that even if it is only 271 yuan per year, Universal has not paid for several years and has been in its own pocket." Wu Xiangfei wrote.

"Tencent sent royalty data about the 12 songs, which had been paid to Universal, but actually belonged to me. According to common sense, the royalties paid by copyright companies to authors are the sum of the payments paid by many copyright users, and the amount is the highest. Interestingly, the usage fee that Tencent should pay me is higher than the total amount of royalties that Universal is prepared to pay me for the same period. Not only that, Wu Xiangfei also found that the song "Stinky Beauty", which was covered in a variety show in 2018, did not appear in Universal's royalty report, so he had doubts about the authenticity of the data provided by Universal.

It is understood that for songwriters, the main income comes from writing lyrics and composing songs for others, which includes advance payments and royalties generated later on the song, and late royalties are an important source of income for creators. After the songwriter gives the work to the copyright company as an agent, the subsequent royalties are paid by the copyright company to the songwriter.

When a copyright company pays royalties to a songwriter, it is required to provide the data details and corresponding revenue generated by the corresponding song after it is used by others, which is generally called the royalty report in the industry. But in practice, songwriters face difficulties in verifying the authenticity of report data.

"The royalty statement is a conscience account for the copyright company." Wu Xiangfei told the "China Economic Weekly" reporter, "Although the contract has a clear clause that 'the author can check the account', but how to check? What song would a songwriter write if he focused on checking his accounts every day? Many authors give their works to the copyright company as an agent, because they believe that the copyright company is better at it, and they are not good at it, but after more than 20 years of dealing with the copyright company, my summary is: not good at it, it should be learned, and not completely asked. ”

A number of musicians revealed to the "China Economic Weekly" reporter that it is not uncommon for people like Wu Xiangfei to encounter things like Wu Xiangfei in the industry, unless they are creators of the level like Jay Chou and Lin Xi.

Chen Xianjiang also said bluntly that in this industry, creators are a relatively weak group, and the royalty share is originally very low, generally speaking, they are agents to copyright companies. If you come across a "bad" copyright company, it is easy to lose money.

In addition, musicians may also be forced to cede copyright when creating OST songs for film and television dramas.

Some insiders revealed to the "China Economic Weekly" reporter that at present, many video platforms require music creators who cooperate with them to transfer copyright cheaply when producing self-made dramas and customized dramas. There are video platforms that have specifically invested in or formed a copyright company, and all the music rights of their custom drama interludes require the creator to authorize the company exclusively and permanently. Some video platforms designate so-called "suppliers", which do not even have the ability to create, but only buy out the "intermediaries" of musicians' copyrights.

As a producer, lyricist, composer and singer, Yan Yidan has sung interludes or theme songs for film and television works such as "Step by Step" and "Cara Lover". She said that ost songs on video platforms (self-made, custom dramas) now generally require "exclusive agency" or "buy out the full copyright of songs". "However, I am also fortunate to have met producers who are willing to protect my creative enthusiasm and who are willing to support me and let me have full copyright in my own creative works." Yan Yidan said.

An independent musician who has been in the industry for more than 20 years joked to China Economic Weekly: "I am used to being 'bullied'. In the past, he was 'bullied' by operators, and now he is 'bullied' by the platform, and you 'fight' him, but he can only 'admit' in the face of absolute strength. "The musician did not hand over his work to the copyright company, but worked directly with the music platform." The report can be seen, we can also see the playback data, this data is true or false, how much money I have, I can't control. Sometimes the playback data is not as high as the number of comments. (Note: The "operator" mentioned by the above musician refers to the era of mobile phone CRBT)

The "merit and fault" of "high guarantee deposit"

The implementation of the "guarantee deposit" system by record companies (immediately after signing the contract, and then collecting the actual royalties according to the situation), is an internationally accepted practice and is of great significance to ensuring the operation of the record company.

As mentioned above, in China, music platforms have pushed the bottom money to a surprising extent in order to compete for exclusive rights.

However, the high guarantee fund relieves some worries for music production companies and musicians with a certain volume and user base.

"The platform pays the music company's guarantee, and in order to strive for exclusivity, it will give a higher premium, which is equivalent to a guarantee for some small companies." The cost recovery of music is to go through a cycle, the production of music requires costs, and the income depends on the amount of playback, unstable, no one can guarantee how much money the music can make. With this money, these companies can create with peace of mind. Chen Xianjiang said.

However, for musicians whose works are small and cannot form cooperative relations with music platforms, they may not be able to enjoy this "dividend".

"During the exclusive licensing period, for example, a music company took a high premium guarantee, it may not care so much about operating songs." Song Yubin, a veteran music producer, said, "If the high premium and high guarantee do not exist in the future, if you want a good work to emerge, you must operate well, promote it, etc., and everyone will put their energy on this." ”

Song Yubin believes that the abolition of the exclusive model is beneficial for music companies in the long run. In the short term, the income on a single platform may decrease, but the cooperation and income channels become more, and the probability of success of the work will increase. "Now with the quality of the project and the content marketing, do a good job and then get the benefits from various platforms, and some projects can also get reasonable prepayment." Now the operating costs are higher, but the key is that there are more opportunities. ”

How far are fans from "musical freedom"?

After Tencent announces the abandonment of exclusive licensing, can listeners no longer switch multiple apps when listening to songs?

In this regard, fans may be temporarily disappointed.

Shortly after the State Administration for Market Regulation issued the penalty decision, Tencent announced that it would waive its right to exclusively authorize music copyright in the exclusive agreement on music copyright with the relevant upstream copyright owner, except in cases where the exclusive cooperation period with independent musicians does not exceed 3 years, and the exclusive release period of new songs does not exceed 30 days.

In other words, Tencent still has some "resource priority".

"If netizens think that they don't need to switch multiple apps to listen to songs in the future, it is actually a misreading." Chen Xianjiang said that open copyright is not mandatory copyright sharing, as for music companies, copyright owners and whether they sign cooperation with platforms, that is another matter, but also depends on the attitude of copyright owners.

It is worth noting that the music platforms are not simply "copyright harvesters", they have long been in the upstream of the industry, and their tentacles cover multiple links and businesses such as music production, publicity, copyright and so on.

"They've been doing their own content, they've invested in a lot of companies, and now a number of the larger music companies in China have their stakes." Qin Ming told the "China Economic Weekly" reporter that this is the case on various music platforms.

In addition, Tencent's deep binding with the head record company may also bring uncertainty to the fairness of music copyright.

In December 2017, Tencent cross-staked its alliance with SPOTIFY, the world's largest legitimate streaming music service platform; in December 2018, Tencent Music went public and introduced Warner and Sony; after that, Tencent Music invested in Universal Music and Warner Music.

There are also rumors in the industry that music platforms are not going well when buying songs that were previously exclusively copyrighted by Tencent.

Wu Xiangfei believes that if it is true, it is also reasonable, "For example, I used 1 million exclusive to buy you 10 songs, you have given me 4 songs, then do not let the exclusive, my remaining 6 songs of money will not come back with you." Usually everyone's cooperation is also good, at this time you will immediately sell these 6 songs to others? ”

"So, it also involves the question of whether the copyright owner is willing to sell, and whether the user can afford to buy it." Qin Ming said.

"We just released a new song, I asked Tencent people to help me push, he would still ask 'is it exclusive or non-exclusive', I said non-exclusive, the other party said 'may be very limited promotion'." Qin Ming said, "The platform will not force you to be exclusive, and there will be a tendency in the allocation of resources." ”

Many musicians believe that in the future, musicians who are still backed by the "big tree" of music platform resources have more resources and opportunities. "As long as the platform is still investing in content, your fairness in the competition will be affected." Qin Ming said.

(Qin Ming is a pseudonym in the text)

Editor-in-charge | Yao Kun

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