Canadian music-rights organization SOCAN reports financial losses for 2019
At a time when the Canadian music industry is contending with the impact of the COVID-19 pandemic, a national music and performance rights-management organization has some unfortunate news about financial losses from the previous year linked to business expansion efforts.
The Society of Composers, Authors, and Music Publishers of Canada (SOCAN), which has a membership of over 150,000 songwriters, composers, music publishers, and visual artists, announced its 2019 financial results on November 4.
It wasn't all doom and gloom as there were some bright spots, including record-setting domestic collections of $315 million, which was 10 percent more than 2018; $405.6-million in total collections, which was an 8 percent increase from 2018; and $86 million in revenue from digital sources, which represents a 37.6 percent increase.
However, distributions to members totalling $296 million reflected a six percent decrease from $315 million in 2018. SOCAN attributed the decrease to the company adapting to new technology to process international and television income.
In addition, SOCAN stated that the 2019 financial results also include losses that impaired $41.7 million to advances made by SOCAN for funding its subsidiary operations since 2016.
"At the time of our investment in these operations, we were exploring new ways to support our members by creating other revenue streams and leveraging new technologies," interim CEO Jennifer Brown explained in a news release. "Business plans didn't come to fruition in the way we anticipated. Through the evaluation process, it became clear that we should divest ourselves of Dataclef assets. We are, however, encouraged by significant success with our new technology system and our improved matching and processing capabilities.”
SOCAN has already devised and implemented a plan for managing the losses, which includes the sale of the assets of wholly owned subsidiary Dataclef, reorganization of Dataclef, and new management leadership.
The company’s annual general meeting will be held online on Tuesday (November 10). Its headquarters are in Toronto and it has branch offices in Vancouver, Montreal, and Los Angeles, with subsidiary offices in New York City and Seattle.