Copyright Licensing Requires Salesmanship: Lessons from the Banned “Wolf of Wall Street”

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One of the most talked about stories in the month of January was the decision by the Kenya Film Classification Board (KFCB) to ban the sale, exhibition and distribution of the critically acclaimed Hollywood film “The Wolf of Wall Street”.

KFCB claims that the film was “restricted” due to elements that include nudity, sex, alcohol, drugs and profanity found in almost every scene of the 3-hour long motion picture which chronicles the title character’s (Jordan Belfort’s) pursuit of the American Dream.

This blogger has watched the banned film and believes that it is a must-watch for all those involved in the sale/assignment and/or licensing of content. In particular, this blogger recommends several short clips from the movie where the lead character demonstrates the art and skill of making a sale.

In the above scene, Jordan Belfort is trying to turn a group of inexperienced, undisciplined misfits into Wall Street stock brokers. In order to illustrate to the basic fundamentals of making a sale, Belfort pulls out a pen and thrusts it in their faces, with the instruction: “Sell me this pen.” After one member of his team declines, another member of his team grabs the pen from him and states:

“Do me a favour and write your name on that piece of paper, there.”

When Belfort looks around for something to write with, the future salesman replies:

“Oh, you don’t have a pen anymore. Supply and demand, bro.”

This scene illustrates a fundamental point for all salespeople: Until a need is recognized, it simply doesn’t matter how great your product or service is. Therefore, there are essentially three parts to any sale: identifying the need, creating urgency and applying the need and urgency to the sale. In short, the role of the salesperson is to help the client reconnect with his/her needs and the urgency to act upon them.

In the case of content, the license is the most common sale because it allows users to enjoy certain rights in the content without transferring ownership in the content. In this connection, this blogger has in mind the four collective management organisations (CMOs) currently in operation within Kenya, namely the Reproduction Rights Society of Kenya (KOPIKEN)Kenya Association of Music Producers (KAMP), Performers’ Rights Society of Kenya (PRiSK) and Music Copyright Society of Kenya (MCSK). Each of these CMOs is in the business of selling licenses to users throughout Kenya with respect to the rights holders in the various categories of works they control. From the CMOs’ perspective, the ends justify the means when it comes to licensing users of copyright works: an increase in licenses issued means an increase in royalties distributable to copyright owners. Therefore licensing staff employ various tactics to create awareness on copyright law while emphasising the need for them to take out licenses for commercial exploitation of copyright works.

A common challenge among the CMOs is increasing the number of licenses issued while at the same time reducing their administrative (operational) costs. One possible solution is tele-licensing whereby licensing staff spend the majority of their time on the phone with potential licensees countrywide. The trick behind tele-licensing is to persuade a commercial user that it requires a copyright license to continue or commence its operations and making arrangements with the user for the CMO to dispatch a licensing staff to deliver an invoice and collect the license payments.

Once again, Jordan Belfort illustrates how tele-licensing could be done in the clip below where he sells penny stocks worth $40,000 in a non-existent company.

In the Kenyan context, a higher degree of salesmanship may be required than that displayed by Belfort in the above clip due to the ignorance of copyright law among a large portion of potential content users. In fact, some licensing staff argue that in some cases, unless they physically visit business premises in the company of uniformed police officers, content users will not take out copyright licenses. However, this blogger argues that despite the low levels of awareness among copyright users, there is still an important need for sales training among the licensing staff of all the CMOs to ensure that they understand the content licenses they are selling and how to create the need and urgency among content users to take out the licenses.

 

In the Kenyan context, a higher degree of salesmanship may be required than that displayed by Belfort in the above clip due to the ignorance of copyright law among a large portion of potential content users. In fact, some licensing staff argue that in some cases, unless they physically visit business premises in the company of uniformed police officers, content users will not take out copyright licenses. However, this blogger argues that despite the low levels of awareness among copyright users, there is still an important need for sales training among the licensing staff of all the CMOs to ensure that they understand the content licenses they are selling and how to create the need and urgency among content users to take out the licenses.

Music Copyright Society Set to Make Millions with Licensees for Performances in Public Places

MCSK MUSIC COPYRIGHT SOCIETY OF KENYA

Recently, the Standard Newspaper in an article titled: “Banking on airwaves” reported that MCSK had entered into a commercial partnership with several well-established entertainment companies aimed at boosting the society’s revenues in license collection.

This so-called “alternative licensing regime” will see the provision of ready-packaged, advert-laden music content to particular establishments and other public places. The revenues generated from the ads in the audio/audio-visual content will then shared between MCSK, the radio and television frequency holder, the content/music provision management and the establishment and/or public service vehicle (through its umbrella body eg. Sacco, Union). The musical content to be used will vary from different music genre mixes, comedy, news highlights, short form documentaries, short films, entertainment news and sports highlights. MCSK notes that Kenyans spend up to 3 hours per day in transit therefore ‘transit advertising’ offers unique opportunities to brands as the audience’s attention is focused on the content in the vehicle, there is over 60% retention and limited distraction unlike in a home/office environment.

According to MCSK, each public service vehicle (PSV) ferries a conservative number of 100 people per day multiplied by the over 70,000 PSVs, MCSK claims it will have an advertising reach of over 7 Million people daily, not including fixed venues (restaurants, pubs, banks, supermarkets etc.)

MCSK contends that its research indicates that point of sale communication contributes to 37% of new purchases. Therefore, MCSK argues that this regime will be able to offer unprecedented exposure and out of home reach for brands. The product will be designed to ensure it’s entertaining, highly engaging and a natural fit to Kenyan lifestyles.

With the advent of this new licensing regime MCSK aims to reduce the operational and logistics costs of collecting these revenues, generate alternate revenue and if optimal capacity from advertiser revenues, then it may not even require to charge the standing fees from partner stakeholders.
This licensing regime will apply to places that rely on broadcast music. (Radio and television stations License is for broadcast into a domestic environment only and not public places and or public environment).

MCSK contends that this new licensing regime will reduce the operational costs with regard to Performance in Public Places (PPP) that usually eats upto 50% of the revenue total revenue collected per annum. Beside sthis, due to the sheer size of the operation and amount of resources required, MCSK claims that the current model of public performance fees collection comes with several inefficiencies like loss of revenue from evasion, corruption and operational gaps.

IPKenya’s comments will be reserved until MCSK officially launches this concept. However at this early stage, it is encouraging to see collecting societies in Kenya being innovative and business-minded in ensuring that the rights holders see greater benefits for their creative work.