Harald Heker has been at the helm of Gema since 2007. A change is due at the end of September this year. As the collecting society announced on Thursday, the 65-year-old Heker is retiring. Tobias Holzmüller, previously chief lawyer at Gema, will take over his position as CEO on October 1st. Before he started working for Gema, Heker was the general manager of the German Publishers and Booksellers Association. He has been a member of the board of the collecting society since 2006. His designated successor, Holzmüller – who, like Heker, has a doctorate in law – has headed the collecting society’s legal department since 2013 and came from the law firm Gleiss Lutz.
The 48-year-old was “decisively involved in the creation and implementation” of the EU copyright directive, according to the statement. He was also responsible for the takeover of the digital distributor Zebralution and the founding of ICE (International Copyright Enterprise). The joint venture is a joint platform of three European collecting societies. At the end of 2020, a dispute with the short video app Tiktok about the remuneration for the music used there was settled. In addition to Gema, its members include the British PRS for Music and the Swedish STIM.
2022 was a record year for Gema
Gema is one of the largest collecting societies in the world and claims to represent the rights of more than 90,000 songwriters, composers and publishers in Germany and more than two million rights holders around the world. As such, on the one hand, it collects the income from exercising the so-called “mechanical” reproduction rights. Through these, the authors of a work are involved in the digital or physical sale and stream of a work. In addition, there is the income from the “performing rights”, which are relevant when a work is performed in public, and the money for reproduction on television, films, series or radio. In some cases, publishers also exercise the rights themselves, or other foreign companies are responsible.
Harald Heker is retiring. : Image: Sebastian Linder
The company can look back on a record year: In 2022, Gema took in 1.178 billion euros, after 1.039 in 2021. 1.009 billion euros are distributed to members, so the total payments have exceeded the billion mark for the first time. The growth resulted on the one hand from the restart of live business after the forced break caused by Corona, but also from a significant increase in online income. 357.5 million euros were incurred through the public playback and performance of music, an increase of 43.7 percent compared to the previous year, but still slightly below the level of 2019 when it was 407.4 million euros.
However, corona restrictions were still in force in the first quarter of 2022, and live business only picked up significantly afterwards. Online revenue last year was EUR 301.3 million (up 26.5 percent), and rights management for radio and television, the third major item, generated EUR 325.1 million – 3.9 percent less than in 2021.
Gema is just as active in the debate about artificial intelligence and how its use affects the music world as it is in the discussion about the distribution of streaming income. Holzmüller recently pointed out the problem to the “Süddeutsche Zeitung” that AI is sometimes trained with works protected by copyright in order to create music in this way without the rights holder having to agree, let alone being paid – a point that many in the music industry drives.
Dispute over distribution of distributions from Spotify & Co
The constantly growing payments from Spotify, Apple, Amazon, Youtube Music and Co. have long since contributed the majority of the income from the marketing of music recordings. It was $16.9 billion last year with total sales of $25.9 billion.
All services pay around two-thirds of their sales to the rights holders of the songs represented on their platforms. A central aspect of the discussion is how the money is distributed among the plants, whether – as is currently the case – according to market share in the respective markets or otherwise. But there is something else that is bothering parties like Gema: Because in the next step, about 80 percent of the distributions are distributed on the recording side. So this share goes to labels, distributors and artists – those who hold the rights to the recordings of a song. The other 20 percent goes to the authors’ side with publishers, songwriters and composers. Last but not least, the Gema is pushing for a larger part of the cake for the latter.
A study on the streaming economy commissioned by Gema was published in September 2022. The associated survey of 4278 Gema members showed a great deal of dissatisfaction with the current division between the various rights holders. One of the arguments is that production and distribution costs in a market dominated by streaming are significantly lower than at the height of the CD. Labels, on the other hand, often emphasize that the development and marketing of new artists is still very cost-intensive, since there is more competition than ever and there are now a large number of platforms and marketing channels to use.
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The streaming debate is not yet as intense in Germany as it is in Great Britain, for example, where the topic has already dealt with a parliamentary committee. In Germany, however, a study is currently being carried out on behalf of Minister of State for Culture Claudia Roth (Greens) on the market and the paths of the funds. We will probably also hear a lot from Holzmüller on this subject in the future.