How the Remunerations are Collected Abroad?

For money to travel from, say, a Parisian radio station to the bank account of Finnish musicians and producers, a process involving several stages and a lot of work is required.

When a Finnish song is played on the Parisian radio station, French copyright societies get notified. The radio station remunerates these societies for the use of music in accordance with local rates and rules.

The majority of remunerations from abroad are the result of phonograms being played on the radio and performed publicly, as well as private copying levies.

Gramex has a comprehensive network of distribution agreements with neighbouring rights societies representing artists and producers in various countries, including France. Based on these agreements, Gramex receives playlists of phonograms used from other countries for processing.

“We use the playlists to make claims, as it were, and inform the societies of songs in which Gramex has a financial interest,” says Gramex’s Director Tuomas Talonpoika. This interest is based on phonogram reports Gramex has received from Finnish music professionals.  The reports indicate who has performed on which phonogram and who has produced them.

However, the play and usage data received from abroad are often not explicit or complete. “Finding information and identifying phonograms sometimes requires Gramex to engage in something reminiscent of detective work,” Talonpoika describes.

Classical and Ethno

Approximately 60% of remunerations from abroad are attributed to classical music. There are several world-renowned conductors and orchestras in Finland that record often.

“In the world of Gramex, Finnish music refers to performers, conductors and phonogram producers who are Finnish. When Tapiola Sinfonietta records Brahms, Gramex collect remunerations,” says Talonpoika.

The remaining 40% of the foreign revenue is split evenly among various genres. Finnish ethno is quite popular, as is the music of our accordionists. In Norway, Sami language music is surprisingly popular, and in Sweden, Sveriges Radio Finska favours all kinds of Finnish music. Pop and rock also have their share.

“Finnish metal may be played abroad quite a lot but often on radio stations that do not provide substantial remunerations per unit.”

For instance, Great Britain has 400 to 500 radio stations but only a few pay remunerations which amount to anything significant for Finnish artists.

Success in sports can also help. “At some point, there was local radio station in Slovenia that played a Matti Nykänen song every Friday at noon.”

Everything is based on agreements

International monetary transactions are based on mutual agreements by copyright and neighbouring rights societies. There are two basic models: With ‘A’ agreements, remunerations are transferred to and from both contracting parties. With ‘B’ agreements, remunerations are collected but not distributed to another society.

In many countries, artists and producers are represented by different societies whereas in Finland both are under Gramex. In some countries, there are several organisations for artists that we have to come to agreement with regarding remunerations.

Countries with agreements in place are available on Gramex’s website. The total number is approximately 60.

“Our agreement network is fairly comprehensive,” says Talonpoika. “We’re currently missing Australia, and South Korea is under consideration. Maybe one day we’ll have agreements with these countries as well. We are also missing several South American countries.”

Exact organisation-specific sums are published annually in Gramex’s Transparency Report which is available on our website. In practice, the copyright society collecting the money always deducts their administrative costs from any remunerations distributed abroad.

Tuomas Talonpoika states that the number usually varies between 10 to 20 percent. “This is naturally dependent on how much the organisation collects remunerations in total, where the organisation is at historically, what kind of investments the organisation makes at various points in time and so forth.”

Gramex the data company

The remuneration operation involves lots of data. Gramex was one of the first copyright collection societies in the world to start using the global RDx hub. An acronym of the words ‘Repertoire Data Exchange,’ this metadata hub contains phonogram metadata, i.e. identification and copyright holder information on phonograms and their producers.

For artist information, a database and system called VRDB embodies the latest technology and international cooperation.

“International distribution is one of the reasons for our transformation into more of a data company,” says Tuomas Talonpoika.

“It is no longer enough to just collect the money. We also want to know where exactly it’s coming from and when the usage took place. This requires more detailed reporting and analytics. Naturally, money also needs to change hands faster than before. This is necessary, and understandably so, particularly for phonogram producers who work in a commercial capacity.”

Today, Gramex’s customers can see which foreign organisations have remunerated them and for how much – even if the sum was only one cent.

“Our next goal in terms of remunerations from abroad is to provide exact information on which user and which channel the money came from. In practice, this naturally depends on how well and precisely the foreign organisation is able to provide a variety of data to Gramex.”

“Many countries are still taking baby steps compared to Gramex in Finland. In our domestic distribution, we are already able to provide this information with precision: the channel, the song, and the sum.”