Companies And Agencies Move Closer To EU-Wide Music Market

Apple has said that it will launch a Europe-wide version of iTunes if record labels, regulators and collecting societies implement plans to simplify the European Union's licensing regime.

The pledge follows a meeting involving Apple founder Steve Jobs and Rolling Stones singer Sir Mick Jagger with EU authorities in September to help solve music licensing problems.

Europe's Competition Commissioner Neelie Kroes set up two meetings between leading companies and collecting societies in the music industry to try to address the problems facing music sales in the European Union.

In order to sell music files in the EU, a retailer must ensure it has the agreement of record companies who will give it the sound recordings and license the mechanical and public performance rights they own.

Then it must agree a deal with collecting societies, which administer mechanical and public performance rights relating to the writers of the music.

Even if a retailer contacts both parties, not all record companies grant rights for all EU territories. And collecting societies tend to operate nationally, meaning that the retailer will need 27 agreements to operate in the EU's 27 member states just to sell a piece of music.

"Against this background, Apple believes that it is currently very difficult for start-up companies to enter the EU online music business and that it would be impossible for them to negotiate with large numbers of entities to clear the repertoire they plan to make available," said the Commission's report of the meeting at which Jobs represented Apple. "Apple observes that new business models in the online world are being delayed and taking longer because of the arduous path."

Kroes is keen to establish a way for music to be licensed on a pan-EU basis. Not only has she set up the round table meetings to encourage industry to find a solution, she also recently published a 'digital agenda' in which she backed Europe wide licences.

"[One priority is] ensuring that for consumers it does not matter which EU country digital content (music, games, films, books) comes from, by paving the way for multi-territorial licensing regimes for online content," said a Commission statement on the agenda earlier this month.

The issue of rights in Europe has recently been further complicated by the decision of some record companies to move from national collecting societies to alternative ones. National societies used to be able to grant licences for virtually all music within their country.

EMI, though, has now granted its rights to an alternative agency which offers a Europe-wide licence. Though the licence has the advantage of covering many territories it means that someone wishing to licence all music now has to go to more than one licensing agency to have all the world's repertoire covered.

Following the Commission's round table discussions, though, EMI agreed that it would let more than one rights agency manage its rights in a bid to create more usable Europe-wide licences.

In turn, French rights agency SACEM said that it would be prepared to be the rights manager for publishers on a non-exclusive basis, and for other agencies to be responsible for licensing its members' content on a pan-European basis.

The participants in the discussion also agreed that a database should be created to allow people to see who controls what rights to make it easier for retailers or distributors to license material.

Apple said that if all those steps are taken it would create a pan-European iTunes store to sell music across the EU.