Thanks, Elizabeth.
The CMPA believes that program funding should at the very least stay at the current level of $25 million. We also believe that the amount of money to support music publishing should be increased, as current funding programs focus almost exclusively on supporting the record labels, not the publishers who represent the creators.
For example, the music entrepreneur component mentioned earlier stands at $8.8 million, but only a tiny portion, $625,000, or 7.1%, is allocated to the publishing community. Regarding other granting programs, such as FACTOR and Starmaker, publishers are virtually shut out.
Until relatively recently, the nature of the business was such that record companies developed, marketed, manufactured, and distributed records. Their core income relied on how many records they sold. The publishers, on the other hand, collected royalties from radio and live performances and from licensing songs to a record. The industry and the world are very different today with technology irrevocably changing the way labels and publishers do business.
Artists demand that publishers function more like a label. Many publishers are now recording and pressing masters, spending thousands of dollars to send writers around the world to write, buying gear and upgrading equipment. They are often giving advances as large or sometimes larger than labels, yet they're only collecting pennies or micro pennies from users. Publishers of all sizes must have a royalty department, an A and R and scouting department, a song pitcher, and a film and TV person, not to mention a support crew.
Music publishers over the coming years must continue to invest in songwriters as well as their own infrastructure. The current funding model stops well short of providing what is needed for publishers to develop and grow. A new publishing company with little or no backing and a limited catalogue may not survive or could take years to become financially stable.
The growth of publishing companies is based mainly on attracting writers, composers, and catalogues. We need a funding program that recognizes this. Similar to the Starmaker program, there should be a program for music publishers whereby successful writers would have money to travel in order to attract writers from other parts of the world. The FACTOR support programs in particular are heavily weighted on the side of labels. There are no opportunities for songwriters or publishers to get significant grant support.
Other publishing programs should help developing artists record demos and masters, allowing publishers to build interest in the writer by releasing to market and using those songs to pitch for film or TV. Funding should also be made available for recruiting and developing publishers' staff and to offset the cost of showcasing or conferences.
Although piracy and illegal downloading affect the business, the music industry still flourishes, collecting income from sources it ignored in the past. It can be strongly argued that the decline in record sales was not fully due to piracy, but had to do with the fact that if you wanted to purchase one song, you had to buy the entire album. Now you can purchase a song for 99ยข. The industry's business model has changed significantly; so too should the way funding is distributed.
A record company invests a great deal of money in new and established artists. Once the cycle of a band's career is finished, the label moves on. For every 100 or even more artists they invest in, only one may become an evergreen. On the other hand, the publisher's job is to work not only for the song when it's current, but also for the artist's future. The challenge is to find a new home for the song, to rebuild an artist's career from that of a performer to a songwriter, to find new outlets for songs, or to find new ways to make an old song speak to a new audience.
The business structures of music publishing companies in Canada are diverse, with the publisher taking on the role of artist manager as well as the catalogue development of national and international artists. There is also a change in the business model. More companies have merged to become 360 business models; hence, the funding support structure should adapt to this new reality.
In line with the changed business models, government funding programs need to ensure fair and equitable access to both publishers and labels. Considering the huge changes the music industry has undergone, a new partnership with the industry needs to develop.
We appreciate the opportunity to address the committee. Thank you.