08 making information pay 2011 -- reid, marlin, shatzkin (rights managment)

May 5, 2011 Making Information Pay

MORE EFFICIENT RIGHTS MANAGEMENT

THE KEY TO FUTURE PROFITS

Mike ShatzkinFounder & CEO, Idea Logical Company

Heather ReidDirector of Data Systems & Services, Copyright Clearance Center

David MarlinPresident and Co-Founder, MetaComet Systems

May 5, 2011Making Information Pay

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The change that is accelerating

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


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Robust rights databases are needed!

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


THE CURRENT STATE OF RIGHTS MANAGEMENT SYSTEMS

Initial Findings from BISG & CCC’s Joint Survey of Publishers and Vendors

Heather Reid, DirectorData Systems & ServicesCopyright Clearance Center


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Survey Process

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


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Summary Findings

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


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Summary Findings, part 2

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

Inbound rights not accessible in the way they should

Outbound rights take too long to process

In the old world, … you create a book and you push it in physical form and the contracts departments was … a back office operation. We’re dealing in a content world now…and as a result…rights [management]…is critical.”

- Publisher


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Every Transaction is a Rights Transaction

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

Rigorous rights management NOT optional Table stakes for truly exploiting new

markets

“This is about leveraging your intellectual property in every sales channel and every market around the globe.”

- Publisher


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Why Rights Are Important Now

“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?`”


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How To Move Forward

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 Systems and process integration

Reduce manual data entry Reinforce proper workflow and communication Cross-company buy-in

“It’s about [knowing] what you need to own in order to transform your business and be a player in the new marketplace. Otherwise, you’re kind of old news. “

- Publisher


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Implementation Strategies

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


CONTENT IN THE WILD

“not the kind of stuff that you

can actually let out into the

world”


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The Wild

“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.”


Brand

Legal & Compliance

Profit

Capital Investment

Stakeholder Value


Legal & Complianc

eBrand

Profit

Capital Investment

Stakeholder Value

Single most important value that the rights system brought to one organization: “Risk Management”

“the Company’s independent registered accounting firm advised the Company that the control deficiency described below constitutes a material weakness in its internal controls.” – an actual Annual Report

“…exposure and liability associated with using content we haven’t acquired.”

“The bigger issue may be that of potential liability to the business”


“Publisher Settles Class Action Lawsuit”

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.”

Brand

Legal & Compliance

Profit

Capital Investment

Stakeholder Value


“we probably will still be dealing with decisions made now in 15 years”

“a database system that creates extra steps instead of removes them is never going to be embraced”

Capital Investment

Brand

Legal & Compliance

Profit

Stakeholder Value


“Unless you can organize your content in a way that makes the purchase very easy, it’s not low-hanging fruit. And that’s kind of what I’m stumbling over right now is getting the content organized.”

“we’re all sitting on the same problem . . . we’ve never really placed strenuous demands on our content in this way.”

“ ‘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”

“By the time they got back to the requester, they had gotten tired of waiting and had gone in a different direction.”

Profit

Brand

Legal & Compliance

Capital Investment

Stakeholder Value


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Risk Mitigation

Taxonomy

Data Model

Tools

“having really a robust taxonomy in place that allows us to group content, to group it, slice it and dice, it”

“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!”


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A next phase project: to make real progress

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


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Use and test the taxonomy

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


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Uncover the workflow challenges

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


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Spread the best practices

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!


FOR MORE INFORMATION

Please contact Jess Johns

[email protected]

08 making information pay 2011 -- reid, marlin, shatzkin (rights managment)

Technology

Transcript of 08 making information pay 2011 -- reid, marlin, shatzkin (rights managment)