By Kevin Zimmerman

The seventh-largest market for music publishing revenue in 2000, Spain is, like most nations, in the midst of waging war against piracy, both in the traditional sense and in the growing number of Internet- and CD-R-related cases. The market closed 2001 slightly up – just in time for Spain’s presidency of the European Union – but major concerns persist.

For 2001, SGAE, or the Sociedad General de Autores y Editores (Spanish Society of Authors, Composers and Publishers), reports revenues of 250 million euro ($226 million), almost a 3% increase compared to the previous year. It distributed 247 million euro ($223 million), a 7% increase over the previous year. The total for mechanical reproduction was 89.3 million (80.7 million), of which 11.6 million (10.5 million) came from abroad.

Record sales received a huge boost in 2001, according to labels’ body AFYVE, which reported a 20% rise in unit shipments to 73.6 million and a corresponding 4% increase in value, to 624 million euro ($564 million). A major factor in those gains was the popularity of the music-based television program Operación Triunfo (Operation Triumph). Nearly half of the 1.7 million Operación Triunfo CDs sold during the year were budget-priced. All told, the program’s double-CD collection, called simply “Album,” and ensuing mini-CD collections have sold over 2.5 million copies.

Per AFYVE, CD sales were up 28% in 2001, to 64 million (accounting for 87% of the total), while cassettes declined 28% to 6.3 million. Vinyl album sales were up 41% to 24,000, with singles sales rising 15% to 2.2 million. Genre-wise, domestic pop continued its lead, repeating a market share figure of 34.7%, while various-artist collections (including those from Operación Triunfo) increased by 6% to capture a l7.5% market share.

AFYVE claims to represent over 90% of the Spanish music market, while SGAE, which also releases record sales figures, computes figures from every record label in the country, including those not affiliated with AFYVE. According to SGAE’s figures, in 2001 unit shipments totaled 80 million (down 0.7%) and revenue totaled 643 million euro ($581 million), a drop of 2%.

While the industry can take some solace in the figures seen for the entire year in 2001, the fact remains that, prior to Operación Triunfo’s explosive success, the marked was mired in a severe slump. For the first nine months of 2001, according to AFYVE, units were down by 14% and value was down by 5%. Piracy received the lion’s share of the blame, with the organization estimating that one out of five CDs sold in the country is illicit. The group believes that figure could grow to as much as 30% of the market in 2002. SGAE maintains that, without the Operación Triunfo series, total 2001 sales would have fallen by as much as 8%.

A trend away from international music and towards domestic has manifested itself over the past several years. International repertoire’s overall market share fell from 57.9% in 1999 to 47.5% in 2001. Various organizations involved in the protection of intellectual property are planning to take advantage of Spain’s six-month presidency of the E.U., which runs through June 2002. On March 26, executives of the Mesa Antipiratería (Anti-Piracy Committee) met with E.U. Committee on Culture, Youth, Media and Sport president Michel Rocard to explain their concerns and seek immediate anti-piracy action. Mesa Antipiratería is composed of 18 organizations representing 64 record labels, 750 music publishers, 66,000 composers and 9,000 musicians, in addition to representatives from the film, video, book audiovisual and retail sectors. The organization also operates a confidential anti-piracy telephone line and website.

Among the matters discussed at the March 26 meeting was the idea that the admission to the E.U. of thirteen formerly Eastern Bloc countries be allowed only if each country passes meaningful anti-piracy legislation, and that the E.C. employ a full-time monitor to assess anti-piracy progress. Mesa Antipiratería also hosted an international anti-piracy congress in Madrid April 17-19, 2002.

CD-R remains a growing concern. SGAE has brought four lawsuits against domestic CD-R manufacturers over non-payment of monies it believes are due under the country’s Ley Para la Remuneración Compensatoria por Copia Privada (Act of Compensatory Payment per Private Copy) law. In January 2002, blank CD-R manufacturer Traxdata Iberica was ordered to pay 0.22 euros ($0.20) for each blank CD-R it had sold since 1997; the company plans to appeal.

Levies have been imposed under the Intellectual property Law of 1997 on the sale of blank audio cassette tapes, videos and photocopier; the law’s language also mentions other, unspecified blank software carriers. Asimelec, the Spanish association of electronic and communications companies, agrees that a payment should be made, based on the number of CD-Rs used to download music, but disagrees with the figure offered by SGAE, which claims that 77% of the 67 million CD-Rs sold in 2001 (up 70% from 2000) were used to copy music. Asimelec says the figure should be 10%, and argues further that any ruling using SGAE’s figures would cost 45.8 million euro ($40 million) to cover the period from 1997 to 2001, and would force a 50% increase on the price of all blank CD-Rs. Asimelect says the total number of CD-Rs sold in Spain between 1997 and 2001 was 206 million.

SGAE, through its Founcatión Autor, implemented 752 support and promotional projects with a budget of over 13 million euro ($11.8 million) during 2001. Many of those involved international exposure of Spanish artists and music, especially through involvement at such international music confabs as Midem, PopKomm, the Latin Alternative Music Conference and Cubadisco. The organization also has put together an annual “Rock en Ñ” tour, featuring various current acts, which plays in South, Central and North America. In addition, SGAE presents its Tomás Luis de Victoria Award for the best symphonic Latin American composer of an annual basis.

The society also operates Sello Autor, a nonprofit record label designed to expose audiences to the works of otherwise little-know composers and artists in the classical and contemporary classical fields. In September the label was expanded to include the Factoria Autor imprint, which will expose new talent in other genres.

The Spanish Musical Academy of Arts & Sciences was officially established in December 2001. Its first mission has been to organize the Musical Awards (handed out in May 2002), with its other objectives including the promotion of musical education, musicology sciences and research regarding its members’ activities. It also plans to establish a giant program in support of young talent, prepare and demand a review of tax treatments for its members.

Meanwhile, in February 2002 Spain’s private music promoters formed the Association of Music Promoters (APM) to counteract what its members believe are factors inhibiting the touring business. A lack of large venues capable of housing popular international acts, a 10% authors’ rights levy for live concerts, and reducing value-added tax (VAT) on concerts from 16% to 4% are APM’s main interests. The group’s members include 18 of the country’s leading promoters, claiming roughly 80% of all private music promotion activity.