8 - Making Information Pay 2011 -- REID, MARLIN, SHATZKIN (Rights Management)

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"The State of Current Rights Management Systems: Initial Findings from BISG & CCC’s Joint Survey of Publishers and Vendors"

Many publishers see a trend that may be, like e-books a couple years back, an early indicator of sea-change for our industry. While book sales are becoming more and more elusive, opportunities to sell licenses of content fragments for websites, apps and derived books are growing.

Consequently, the mismanaging of rights associated with these fragments can have severe impacts on a publisher’s brand and bottom line.

Unfortunately, figuring out who owns all rights available to a work often requires costly research and negotiation that can eat up potential profits before they’re realized. Often, this discourages publishers from responding to rights licensing requests at all. Those who do struggle to track collections and expend costly resources on managing revenues. And when they do license content, they struggle to track collections and expend costly resources on managing revenues.

Under direction from BISG, rights experts from the Copyright Clearance Center (CCC) and MetaComet Systems, with the help of The Idea Logical Company, have researched the extent of this challenge across the industry. It is hoped that results from this research can lead to recommend best practices for rights management.

During this three-part presentation, Heather Reid (CCC), David Marlin (MetaComet), and Mike Shatzkin (Idea Logical Company) present the results of BISG’s research, describe the challenge, and detail what they believe are the next steps toward an industry-wide solution.

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8 - Making Information Pay 2011 -- REID, MARLIN, SHATZKIN (Rights Management)

  1. 1. MORE EFFICIENT RIGHTS MANAGEMENT THE KEY TO FUTURE PROFITS Mike Shatzkin Founder & CEO, Idea Logical Company Heather Reid Director of Data Systems & Services, Copyright Clearance Center David Marlin President and Co-Founder, MetaComet SystemsMay 5, 2011 Making Information Pay
  2. 2. The change that is accelerating2  Whole books get harder to sell in any format: competition and atrophying channels  Fragment permission and licensing opportunities grow, due to apps, ebooks, and web sites  More transactions, fewer dollars per  Rights research eating up too much of the revenue Making Information Pay May 5, 2011
  3. 3. Robust rights databases are needed!3  Or, so it seemed, but we wanted to confirm  CCC funded research for a team to speak to publishers and service providers  We learned this is a pain point that is universally appreciated  We learned that this is a vast problem that stymies just about every company  We think we figured out where to begin to solve it Making Information Pay May 5, 2011
  4. 4. THE CURRENT STATE OF RIGHTS MANAGEMENT SYSTEMS Initial Findings from BISG & CCC’s Joint Survey of Publishers and Vendors Heather Reid, Director Data Systems & Services Copyright Clearance CenterMay 5, 2011 Making Information Pay
  5. 5. Survey Process5  Goal was to get a read on the rights management landscape among U.S. publishers  We interviewed both publishers and vendors of rights management systems  Nine publishers  Six vendors Making Information Pay May 5, 2011
  6. 6. Summary Findings6  Only one publisher interviewed has addressed rights management comprehensively  Some have at least some data stored digitally in a persistent data structure  Many publishers only store their rights data as PDFs of legal contracts “50% of all publishers – and even the big ones – don’t have a digitized contract file. They’ve got contracts filed in paper files somewhere.“ -Vendor Making Information Pay May 5, 2011
  7. 7. Summary Findings, part 27  Current systems are ineffective and don’t adequately meet needs  Mix of off-the-shelf and home grown systems  Not well integrated  Not managed/funded as strategic initiative  Rights = a choke point In the old world, … you create a book and  Inbound rights not accessible in the way you push it in physical form and the contracts departments was … a back office they should operation. We’re dealing in a content world  Outbound rights take too long to process now…and as a result…rights [management]…is critical.” - Publisher Making Information Pay May 5, 2011
  8. 8. Every Transaction is a Rights Transaction8  Digital Publishing is a true paradigm shift  Creating both opportunities and threats  Global marketplace for digital products  Entails strategic management and exploitation of rights  Micro-transactions will grow  Knowing rights at a granular level is key “This is about leveraging your  Rigorous rights management NOT intellectual property in every sales optional channel and every market around  Table stakes for truly exploiting new the globe.” markets - Publisher Making Information Pay May 5, 2011
  9. 9. Why Rights Are Important Now9 “Licensing is a field that will only continue to grow in this new world.” “Rights are the foundation for everything now.” “We saw a 100% increase in licensing revenue when we started responding faster to rights requests.” “You have licensing/permissions working in the 60’s and digital media being created in 2011 – it creates bottlenecks.” “Traditional models and channels disappearing at a rapid rate.” “You’re losing revenue for sure if you don’t know what your rights are.” “It’s not can we afford to, but can we afford not to?`” Making Information Pay May 5, 2011
  10. 10. How To Move Forward10  Industry education  Best practices  Discussion of issues and complexities  Develop standardization of terms and definitions  For “rights in” and “rights out”  Common taxonomy  Alignment within and among publishers  Reframe rights management as strategic to business  Rights vended are rights sought  Publishers seeking bundles of rights are also vending those same rights “It’s about [knowing] what you  Systems and process integration need to own in order to transform  Reduce manual data entry your business and be a player in the new marketplace. Otherwise,  Reinforce proper workflow and communication you’re kind of old news. “  Cross-company buy-in - Publisher Making Information Pay May 5, 2011
  11. 11. Implementation Strategies11  Start by databasing current contracts; then address the backlist  Systems must be flexible and extensible – adapting as market demands evolve  Systems integration is key – rights management system must talk to other key systems Making Information Pay May 5, 2011
  12. 12. CONTENT IN THE WILD “not the kind of stuff that you can actually let out into the world”May 5, 2011 Making Information Pay
  13. 13. The Wild13 “I think it’s the scariest thing that I’ve heard in the past few years…because the value that we still have as publishers … as content curators and content creators … if we don’t do a better job of this, we’re going to lose that advantage … very quickly.” Making Information Pay May 5, 2011
  14. 14. Brand Legal & Compliance Stakeholder Value Profit Capital InvestmentMaking Information Pay May 5, 2011
  15. 15. “the Company’s independent Legal &registered accounting firm advisedthe Company that the control Compliancedeficiency described below Brandconstitutes a material weakness in Stakeholder Valueits internal controls.” – an actual Capital ProfitAnnual Report InvestmentSingle most important value that the rights systembrought to one organization: “Risk Management” “The bigger issue may be that of potential liability to the business” “…exposure and liability associated with using content we haven’t acquired.”Making Information Pay May 5, 2011
  16. 16. Brand Legal & Compliance Stakeholder Value “Publisher Settles Class Action Lawsuit” Profit Capital Investment Importance of Author Relationships: “Any author who ever hears me responding to this is going to go, it better be a five. So it’s a five.”Making Information Pay May 5, 2011
  17. 17. “a database system that creates extra stepsinstead of removes them is never going to beembraced” “we probably will still be dealing with decisions made now in 15 years” Brand Legal & Compliance Stakeholder Value Profit Capital InvestmentMaking Information Pay May 5, 2011
  18. 18. “Unless you can organize your content in a way thatmakes the purchase very easy, it’s not low-hangingfruit. And that’s kind of what I’m stumbling over rightnow is getting the content organized.” “ ‘it’s just easier for me to go out and source my own content than to work with you guys,’ scariest thing that I’ve heard in the past few years” Legal & Brand Compliance “we’re all sitting on the same problem . . . Stakeholder we’ve never really placed strenuous Value demands on our content in this way.” Capital Investment Profit “By the time they got back to the requester, they had gotten tired of waiting and had gone in a different direction.”Making Information Pay May 5, 2011
  19. 19. Risk Mitigation19 “How good your data management is allows you the greatest leverage and facility to actually do with your intellectual property what you thought you were acquiring it for!” “having really a robust taxonomy in place that allows us to group content, to group it, slice it and dice, it” Making Information Pay May 5, 2011
  20. 20. A next phase project: to make real progress20  The first goal: all publishers properly databasing new contracts from inception  The next objective: figuring out what it takes to get any publisher to that point  Required: a taxonomy that works, contracts and permissions mapped to the taxonomy, a workflow that captures new contract terms in a database reflecting the taxonomy Making Information Pay May 5, 2011
  21. 21. Use and test the taxonomy21  Select a core group of (about) 15 publishers: all sizes, all types  Pull all current “standard” contracts; map them to BISG rights committee taxonomy  Capture 3 months of permission and relicensing requests: map them to taxonomy  Analyze taxonomy for gaps; refine taxonomy and, if necessary, the contracts Making Information Pay May 5, 2011
  22. 22. Uncover the workflow challenges22  For each publisher, track the workflow that leads to the contract (editor’s instructions?)  Look for opportunities to capture contract info in database simultaneously with issuance of contract  Redesign workflow to create both at once  Create checkpoints to make sure contract and database are in synch Making Information Pay May 5, 2011
  23. 23. Spread the best practices23  Deliver a template for the database with checklist of contract “trouble spots”  Document workflow alternatives that deliver both contract and database  Develop a program to cost-efficiently help all publishers get to best practice with new contracts  Finally: we can then think about the backlist! Making Information Pay May 5, 2011
  24. 24. FOR MORE INFORMATION Please contact Jess Johns jjohns@idealog.comMay 5, 2011 Making Information Pay

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