07 February 2018
Reporter: Barney Dixon

IFPI calls for “effective solution” to value gap

The International Federation of the Phonographic Industry (IFPI), with the support of 23 other creative industry organisations, has penned a letter to the new presidency of the European Council asking it provide an “effective solution” to the so-called value gap.

IFPI’s letter was sent in advance of a meeting on 31 January, in which representatives of the EU’s 28 member states discussed their approaches to the draft Copyright Directive.

According to the federation, the value gap is caused by user upload services, such as YouTube, not returning a fair value for music that is uploaded to their platforms.

In a report on the value gap last year, IFPI said: “This is a fundamental challenge for the music community, which is campaigning for a legislative solution to this issue known as the ‘value gap’.”

In its letter, IFPI argued that user upload platforms were abusing safe harbour rules, which are intended to protect passive online intermediaries, such as internet service providers, from the actions of their users.

IFPI said that the new presidency “provides the unmissable opportunity for a solution as it will lead the Council’s work on the EU Copyright Directive proposal”.

Last year’s IFPI report revealed that more than 80 percent of YouTubers had used the service for music streaming in the past month, amounting to an estimated 1.3 billion users.

YouTube is estimated to pay less than $1 to rightsholders per user, compared to $20 per user paid by Spotify.

Francis Moore, CEO of the IFPI, said: “The value gap remains the single biggest threat facing the music world today and we are campaigning for a legislative solution.”

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