Towards a healthy musical ecosystem

Same as 2020, the last year was influenced by lockdowns and anti-Covid sanitary measures for most of the year. Concert productions were considerably restricted compared to the pre-Covid years. Authors and publishers are summing up their losses which have reached the total amount of CZK 480 mil. over the last 2 years. The biggest decline in revenues logically occurred in concert productions. According to calculations including concerts of foreign bands, music authors lost more than CZK 250 mil. in royalties. This is one of the reasons why OSA continued to follow the principle of solidarity last year and at the beginning of this year. Over the 2 years, we have paid out Covid aids in the amount of CZK 19 mil. in addition to regular royalties to about a thousand authors affected by the ban on concerts.

Despite the ongoing pandemic situation, OSA achieved the second best economic result in its history. Last year and the year before, we managed to settle legal cases and enter into agreements with large users with respect to prior periods. In total, the amount exceeded CZK 222 mil. Revenues for granted licenses collected for music authors thus reached the amount of CZK 1.1 billion in 2021. The costs incurred were by CZK 2.6 mil. lower year-on-year, the average cost deduction (cost to revenue ratio) thus reaching 11.6%. As a result, OSA is one of the best managed music collecting societies in the world.

The end of the last year brought very sad news which affected the work of OSA Supervisory Board. In December, two longtime members of the Supervisory Board passed away – Luboš Andršt and Juraj Filas. Luboš Andršt had participated in the transformation of OSA since after the Velvet Revolution as he had been elected a committee member in 1990. He was the chairman of OSA Supervisory Board without interruption from 2010 until he got ill and was replaced in the Supervisory Board by Martin Kratochvíl in spring 2021. He greatly contributed to the modernization of OSA, its Distribution Rules and Articles. Another member of the Supervisory Board, professor Juraj Filas, died at the age of 66 at the end of the year. I believe that he can be rightly considered one of the most played authors of contemporary classical music in the world.

Last year, we accelerated the payment of royalties which are paid out on a monthly basis. Modernization of OSA continues and acceleration of the payment of royalties to our authors and publishers is an integral part of this process. Our priorities also include making it easier to obtain a license to use music in public establishments. On our website, we have been developing our online store where public establishment operators can buy licenses for playing music just as easily as buying any other type of goods or services.

This year’s development of authors’ and publishers’ revenues from the performance of their musical works remains unclear. The world has not recovered from economic and social losses caused by the Covid-19 pandemic and it already faces economic tensions which are partially the result of the previous 2 years. The inflationary spiral has been set in motion in a very dangerous way. To fight the rising inflation, the Czech National Bank has chosen to solely increase interest rates. This will inter alia put pressure on households with mortgages. The energy crisis, strengthened by the war conflict in Ukraine, will undoubtedly translate into a rise of prices of services and goods and, as a result, into a decline in purchasing power of the population.

We are about to witness two competing effects which have accumulated over the past months and years. One is optimistic and will benefit from the unmet demand of music fans for concerts, resulting in gradual return to the pre-Covid cultural and social life. On the other side, there will be bad mood in the form of reduced purchasing power of the Czech population. When the economic situation worsens, the first cut made in family budgets is usually the expenditure on culture. We must hope in positive trends with people wanting to have their souls caressed by their favorite music.

With one year delay compared to other EU countries, the discussion and approval of an amendment to the Copyright Act, which is to implement two EU directives into the Czech law, were finally put on the agenda of the Parliament of the Czech Republic. One of the directives aims at simplifying the settlement of rights with respect to broadcasters and retransmission. The other is crucial to achieving balance between authors and artists on the internet in relation to technological giants such as Google or Facebook. There will be great debate on filtering illegally uploaded copyright content. Creation of a fair environment on the internet will be beneficial to the entire society. People are creative creatures and, therefore, I am convinced that fair conditions in the virtual space will produce additional legal and innovative services that will offer the much needed space for young and aspiring artists.

Only a healthy musical ecosystem where it goes without saying that authors get back the money they spent, can help the domestic music scene stand up to the growing international competition. It can help the Czech music become an interesting export product once again. I believe that OSA has proved, not only at the time of the Covid-19 pandemic, that it is an integral and useful part of such a healthy musical ecosystem.

I look forward to new musical pieces written by our authors. I know thanks to our Partnership project, which has been providing financial contributions for new music projects to authors for many years, that authors were not idle at the time of the pandemic. They wrote new pieces for us, recorded new studio albums and made music videos. I believe that there is a lot to look forward to. The world is much more colorful and cheerful than the picture presented in the media. We shouldn’t let the information vacuum of the media and social networks get us down, we just need to look around and watch what is really going on around us.