Google is under pressure and feels it may have to close. At the same time Baidu, its great rival (and bigger in China and Chinese), announces a new deal and all the internet sites that used to provide the pirate music for Baidu’s search engine are being sat on. There are new regulations to try to sort out who actually owns what rights in China, a vital move as many people claim exclusive rights for many different services and still no-one gets paid. New regulations are also saying that radio and TV have to start paying for the use of music on their services.
Meanwhile the government announces the development of three China Music Industry Parks - in Shanghai, Beijing and Guangzhou. Each year, China sends a bigger delegation to Midem, the music industry trade fair. And China’s big state owned music companies are expected to become privatised in the near future.
The Chinese are not stupid. They realise that Nike and Gap make more from branded goods than the manufacturer does. IP is clearly a vital part of the game. The Americans are always going on about piracy in China and that annoys them and embarrasses them. So if you can’t beat them, the answer is to join them.
Authors rights in China receive much better protection, in theory, than recording rights. The MCSC (the Music Copyright Society of China) is a potentially powerful ally for the music industry, but the major rights owners seem obsessed with trying to get a quick fix to the bottom line. They like to hear from people who can assure them that they know where the gold can be found, and to prove it by delivering nice advances into sticky hands.
As an industry, we should support the MCSC and other more honest state companies. Private companies are always vulnerable and, if they are successful, there is always someone there who has to be taken care of. As an industry we see what is going on and realise the bizarre benefit to us of Chinese control of the net.
If anyone could put an end to 95% of internet piracy in their country, it’s the Chinese with their armies of internet snoopers. Maybe one of the reasons Google was given a hard time was because it was American, the industry backed it, and it didn’t complain about getting little if any money.
But change comes quickly in China and the upcoming international trade fair Shanghai Expo could play a crucial role in the development of a Chinese recorded music industry where both sides sell to each other. At the moment around 90% of the music listened to in China is Chinese (Mandarin or Cantonese). But with 40 million learning classical piano, and with the establishment of a ‘Beijing Fame Academy’ – where I’ve been invited to talk – there are clear indications of the direction popular music is likely to take. If western music can recruit 10% of fans among the Chinese population, that equates to 130 million people. Quite likely the people with western tastes are also the people with money. The Japanese Sony corporation now owns one of the majors. The question is: will China end up owning one of the others?
When it comes to China, the one thing we can be certain about is that we can’t be certain of anything, but watch this space closely – the results could be interesting. Peter Jenner is a music manager and record producer.
Karen Buse - Director of International at PRS for Music, gives the society’s perspective here.