The German music industry is preparing for “hard times” in the face of the corona virus pandemic and is now demanding direct support from the German government. Those affected in the industry would “only survive this time if the federal government acts,” says an open letter from the German Music Council on Wednesday. The signatories call for “emergency aid suitable for the industry and an economic stimulus program” to ensure the survival of the established structures of the music industry.
Live business breaks down
The corona virus and the restrictions that have been in effect for weeks hit one of the pillars of the German music industry particularly hard: Larger live events are currently not allowed to take place. The music council fearsthat these restrictions “will probably apply well into the coming year”. In addition, the implementation of concerts under the necessary hygiene measures “will not be possible to cover costs until further notice”.
According to one, live events generate study of the Federal Association of the Music Industry (BVMI) in 2015 accounted for a good quarter of the added value of the entire industry, which amounted to around 3.9 billion euros in 2014. At the same time, almost half of the approximately 68,000 people employed in the private music industry worked in the live sector. There are also tens of thousands of artists and self-employed people who earn a large part of their income from concerts. The association has no newer figures, and a new edition of the study is due to appear this year. Streaming is now dominant in the recording business.
Emergency aid program required
According to current estimates by the associations, over 50,000 musicians have to cope with a loss of revenue totaling 325 million euros in six months. Around 80,000 events had to be canceled by the end of May. The industry puts the sales losses due to unsold tickets and canceled events in total at around 3.6 billion euros for half a year. That is why the music industry had already asked for an emergency aid program at the end of March that took account of the special needs of the industry.
“The previously non-industry-specific emergency aid programs are not sufficiently suitable to prevent the impending insolvency, especially of small and medium-sized players in the music industry,” the Music Council is now emphasizing this demand. In addition to what has been achieved so far, the industry representatives are calling for “emergency aid suitable for the industry as well as an economic stimulus program that will ensure the survival of the heterogeneous, historically grown and diverse networked infrastructure”.
Gema pours out
Meanwhile, the Gema provides short-term relief. The collecting society claims to have raised 1.07 billion euros from concert organizers, discotheques, radio stations and internet services last year and is distributing 906 million euros of this to two million composers, text authors and music publishers worldwide. “Against the background of current developments, Gema’s very good financial year 2019 will be a crisis airbag for our members,” said CEO Harald Heker in Munich on Wednesday. For many, the distributions are a living wage.
By far the largest contribution to the total Gema volume was made by income from music events, which “rose due to a strong concert year” in 2019 by five percent to 407 million euros. However, the failures caused by the pandemic will have a full impact on the income of Gema and the rightful owners will then be missing next year.