Music Licensing and Sustainable Nightlife: Germany’s “GEMA- Tarifreform” Debates – Luis-Manuel Garcia

Some music producers have good reason to wish they could choose another organisation to represent their creative works, since GEMA’s structure is one that favours the interests of high-earning, “mainstream” artists signed to major recording labels over underground, independent ones. Membership in the society is organised into a hierarchy of “full members,” “extraordinary members,” and “associated members.” Only the tiny minority of full members (3,323 out of approximately 64,000) can vote directly on decisions and hold positions of power within the organisation. Gaining full member status currently requires that you earn more than €30,000 in fee-revenues from GEMA over five years, which places it out of the reach of most underground music-makers. This mainstream-elite has the power to determine the licensing fees and revenue-sharing for all of its members; unsurprisingly, this often results in decisions that benefit full members and leave the rest of the membership dissatisfied, to say the least. Added to this is the fact that GEMA has the legal power to assume that all music being played at a music event belongs to GEMA’s catalogue of protected works, even without a detailed list of what music was played. For underground music venues that mainly feature non-mainstream and independent artists — like many dance music clubs — this means that a portion of the fees collected for these events will likely find their way into the bank accounts of mainstream artists and advertising jingle writers, whose music was never played during the event, while some artists will never see a single cent for their music, however often it may be played at such events.

That’s GEMA in a (very small) nutshell, but what gave rise to the nation-wide debates of 2012? Well, that’s a long story that extends well before 2012, but the current debate was sparked on April 14th 2012, when GEMA announced a new system of licensing fees. They announced that the new fee structure was simpler, scaleable, and more proportionate to the size of music venues and their events. The new tariff system would indeed be simpler — two new fee rates would replace the previous eleven — but whether it was accurately scaleable and proportionate remained a hotly-contested question. For example, the new rates for discotheques were calculated based on the surface area of the venue and the cost of entry, aiming to take 10% of the gross ticket sales. However, this rate assumed that: a) the venue’s capacity was equal to one person per square-metre; b) every square metre of the venue was useable (e.g., not blocked by walls, the bar, toilets, backstage spaces, etc); c) every event was at full capacity; and d) everyone in attendance was paying full price. Once local venue managers started doing the calculations, many estimated yearly fee increases of anywhere from 200-1000%. Sure, the more extreme estimates were probably exaggerated “worst-case” calculations, but even conservative estimates still predicted at least a doubling of costs for most venues. But perhaps the most galling detail for music-event organisers was the fact that GEMA published this new tariff system directly in the Bundesanzeiger (Federal Gazette), which made it legally binding: this was a fait accompli, not a proposal open for negotiation.

There’s still some debate as to what GEMA thought to accomplish, PR-wise, with this move, but the ultimate result was a great deal of public criticism and increasingly negative press coverage. Much of this was shaped and amplified by various actors in the music scenes of Germany (especially nightclubs), who quickly learned to coordinate their efforts and act strategically. Regardless of whether one supports GEMA or its opponents in this debate, it’s hard to deny that the anti-GEMA side outmanoeuvred them in the public-relations game. In fact, it’s noteworthy that, by the end of 2012, the debate had shifted from merely opposing the tariff reforms to challenging the existence of GEMA itself.

In any case, the rest of the spring of 2012 saw increasingly vocal opposition to GEMA’s Tarifreform, starting first with nightclub promoters, music producers, DJs, and label managers, but soon spreading to music fans and the wider public. Germany’s electronic dance music scenes were the most vociferous in their opposition, since nightclub events serve as crucial hubs for networking, discovering new talent, testing new tracks, popularising new music, making music-production financially viable, and (last but not least) dancing. Since GEMA’s new fees seemed to pose an existential threat for nightclub venues (especially the mid-sized ones with narrow profit margins), many saw them as a threat to music scenes as a whole. Somehow, rumours started circulating that foretold the closure of high-profile nightclubs in Berlin, such as Berghain, Watergate, and Weekend. These turned out to be mostly unfounded, but the buzz surrounding these rumours garnered wider attention for this issue.

In the meantime, Germany’s nightlife industry began to work together to organise protests that would make the concerns of underground nightlife more visible to normal “daylife” society. But they struggled to inspire party kids to take to the streets; the first protests in June were sparsely attended and unfocused. As the summer progressed, however, they adapted their format, combining protest and partying by featuring performances by well-known DJs between political speeches and advertising the events as if they were open-air parties. By the time the Gemeinsam Gegen GEMAinheiten protest took place on September 6th, approximately 25,000 people took part in protests Germany-wide, with 10,000 in Berlin alone (according to estimates from organisers).