The headlines
regularly tell us that overall revenue from record sales is continuing
to decline. This decline is having a huge impact on the bottom
line at most record companies, and is being felt by all music industry
entities receiving a revenue stream related to record sales.
Mechanical licensing and mechanical royalties, the flow of permission
and money between record companies and music publishers, is more
important than ever before as these parties fight over the size of
their slice of a shrinking recorded music pie. While much
discussion in this area of the music industry focuses on what the
mechanical royalty rate should be, there is little discussion of the
mechanical licensing process, and its related administrative cost to
all of the parties participating in it. This paper
takes a close look at the mechanical licensing process in a number of
countries around the world, highlighting the relative simplicity or
complexity of the process steps and the level of resources needed to
perform them. As pressure to reduce administrative costs within
the recorded music industry continues to grow, the willingness to
consider new and more efficient ways of doing business should also
grow. Identifying the least administratively burdensome
approaches to mechanical licensing in use around the world today will
help inform the future decisions of both business executives and
governmental bodies with respect to this area of the music industry. (view
session) |