Online services increasingly important as TV viewing habits change

MonitorDollarSign_ByRenjithKrishnan_CST Published 10/2/2014

By Jennifer Brown

As television viewing habits change, online audio-visual (AV) services are going to become increasingly important as a source of income for the songwriters, composers, and music publishers served by SOCAN.

While SOCAN already had a number of agreements in place with online AV services, this summer the Copyright Board of Canada approved Tariff 22.D.1 for Online Audiovisual Services and Tariff 22.D.2 for User-Generated Content. We’re pleased that we now have a tariff to apply to all online AV services in Canada, so that we can license the newer ones and generate royalties for our members that more accurately represent the full TV spectrum. These new tariffs for the use of music in streamed movies, TV programs and other audio-visual works online will allow songwriters, composers and music publishers to receive royalties for previously uncompensated uses of their works by online services, such as Netflix.

That’s especially important, given the changing habits of television viewers. Over the past couple of years, traditional TV revenue to SOCAN – which is based on a percentage of gross advertising income of the television station or network – has been changing.

Numerous reports suggest that all forms of traditional TV are experienced advertising revenue losses of between 4.5 and 8 percent in 2013. Specialty TV has remained strong, with revenue growing at 5.2 percent last year. TV viewing still remains robust, with bigger gains in the 55-plus age demographic.

But this increase is likely not offsetting younger generations, many or even most of whom never have watched TV in the traditional sense. Still, households with numerous TV subscriptions are expected to outnumber households who terminate all TV subscriptions by 100 to 1. It does appear, at a high-level view, that Canadians have not abandoned TV, but might be viewing it in different formats.

The 2013 Rogers Innovation Report found that while 90 percent of Canadians still watch their television sets, more than eight out of 10 people view “entertainment” on a second device – and that could be a laptop (60 percent), smartphone (42 percent) or tablet (23 percent). About 61 percent of Canadians use another device while watching TV, while more than a third of Canadians looked up information online while watching.

What all of this means for the overall industry is still difficult to tell definitively – which is why SOCAN will continue to monitor these and other trends and consult with those experienced in the industry to determine the best course of action for all of our members and licensed music users.

About Jennifer Brown

Jennifer Brown heads up the Licensing department at SOCAN, which is responsible for collecting royalties from businesses that use music in broadcasts, streams, concerts and in their establishments. Jenn is an avid music fan and has a recurring New Year’s resolution to finally learn to play a musical instrument.

Comments

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  1. Howard Druckman

    I know what you mean, but who would be the most effective at actually obtaining fair compensation for SOCAN members? I’d argue that collection agents would be more qualified for the job, and do it more efficiently and effectively, than music lovers. Whether they care or not, they’re good at the job.

    Reply

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