SOCAN Announces New Arrangement for YouTube Revenues

In early November, SOCAN (the Canadian performing rights collective) announced the entering into of a new agreement which probably should have garnered more attention than it did: YouTube earnings unlocked for SOCAN members.

The basics of the new arrangement are this: SOCAN has entered into an agreement with Audiam, an organization which licenses “synchronization” right in compositions and recordings (as described in the Audiam FAQ), to collect revenues from YouTube arising from the use of songs in videos uploaded to YouTube. Audiam itself has evidently entered into an arrangement with YouTube for the license of the “synchronization” rights in compositions and recordings  – the “synchronization” right is the right to control the “pairing” or “synchronizing” of compositions or recordings with visual elements; when a recording of a song is used in a video, a license is required from the owners of rights in the composition and the recording of that composition (if just the composition is used, e.g., when a video consists of the live performance of a composition, then just the license from the owner of rights in the composition is required). The revenue in question arises from advertising revenues which YouTube collects for ads which are shown in conjunction with the revenues. SOCAN will be collecting from Audiam revenues payable to the owners/administrators of rights in the compositions (presumably the owners of the rights in the recordings will be contracting directly with Audiam or YouTube). Notably, the Audiam arrangement includes revenues from what I’ll call “unauthorized” videos – in other words, Audiam collects revenues not just from “official” videos which the copyright owners have created and uploaded to YouTube, but from “user-generated” videos, such as the proverbial “dancing baby” video where someone uses a song in conjunction with a video the user themselves has created.

A number of elements make this new arrangement and announcement notable, including the following:

  • SOCAN is generally not associated with the collection of synchronization revenues, as that has in the past been something which publishers have either administered themselves or licensed through the CMRRA (Canadian Musical Reproduction Rights Agency) – in other words, this deal with Audiam represents an expansion of the scope of rights historically administered by SOCAN
  • as the SOCAN announcement notes, “Earlier in 2013, SOCAN granted YouTube a performing rights license for Canada covering the years from 2007 to the present” – that appears to be a bespoke license granted by SOCAN to YouTube, outside the Tariff 22 structure
  • one factor not addressed by the announcement (and there’s no reason to expect that it should or would have been) is how this interfaces (or not) with the “Non-Commercial User-Generated Content”  provision found in Section 29.21 of the Copyright Act (Canada) – that provision had been referred to by many (including me) using the short-hand “YouTube exception”; might this be taken as an admission that YouTube itself cannot rely on the shelter provided by Section 29.21?

A move away from the “omnibus” tariff process and towards “bespoke” licensing arrangements seems important and one worth further discussion – it will be interesting to see whether similar future SOCAN announcements will be made with respect to other online platforms.

Bob Tarantino

About Bob Tarantino

Bob Tarantino is Counsel at Dentons Canada LLP and focuses his practice on the interface between the entertainment industries and intellectual property law, with an emphasis on film and television production, financing, licensing, distribution, and IP acquisition and protection. His clients range from artists and independent producers to Canadian distributors and foreign studios and financiers at every stage of the creative process, from development to delivery and exploitation.

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