Annual Report

Annual Report
2011
finnish composers’ copyright society teosto
teosto
what is teosto?
ς An organisation of music authors.
ς A non-profit organisation founded in 1928 by composers and music publishers to
administrate and protect their rights.
ς Represents more than 26,000 Finnish and almost three million foreign composers,
lyricists, arrangers and music publishers.
teosto’s mission
ς To enable successful professional music-making in Finland.
ς To collect and distribute to music authors and music publishers royalties for public
performances and recordings of their music.
ς To promote and protect the rights of composers, lyricists, arrangers and music publishers.
ς To sell and develop services for its customers’ music use needs.
ς To promote diversity in, awareness of and performances of Finnish music in Finland and
on the export market.
teosto’s customers
ς Teosto is a link between two customer groups, music authors on the one hand and
companies and organisations that use music on the other.
ς Music user customers include TV and radio broadcasters, organisers of concerts and other
events, restaurants, and other companies and corporations that use background music in
their business.
teosto’s results in 2011
ς Domestic sales revenue amounted to EUR 45.3 million, of which EUR 39.4 million (86.9%,
aer deducting expenses), was distributed to composers, lyricists, arrangers and
publishers.
ς Royalties received from other organisations for distribution to Teosto rightholder
customers amounted to EUR 8 million. is included EUR 4.4 million from the Nordisk
Copyright Bureau (NCB) for mechanical reproduction of Finnish music in recordings and
films, and EUR 2.8 million from Teosto’s sister organisations for performances of Finnish
music abroad.
ς In accordance with decisions taken by Teosto members, 6.7% of the domestic performing
rights royalties collected (EUR 2.6 million) is used to promote Finnish music.
teosto’s vision
Teosto is the most active and competent solution provider in the Finnish music market.
teosto’s values
ς For our customers, on behalf of music.
ς We think creatively and resolve efficiently.
ς We are responsible.
ς We are enthusiastic, we succeed.
2
contents
Review by the CEO
Giving voice to authors
Working for the music author community
6
8
Trans-border co-operation
8
e voice of authors in Europe
8
Cultural ambassadors form a bridge between politics and everyday life
11
Revenue for authors
14
Increasing percentage of women
15
Development of online services
16
Professional training
16
Promotion and export of Finnish music
16
Music is made all around Finland
17
Music has meaning
6
18
Festival summer exceeded expectations
18
Background music is important
19
Online sales are still low
19
Licensing supporting legal services
20
Towards more flexible solutions
21
Compensation for private copying awaits reform
22
Compositions performed most oen in 2010
24
Events from 2011
26
General Meeting and Board of Directors
30
Commiees and working groups
32
Customer’s Teosto
33
Financial statement
34
ANNUAL REPORT 2011: Production and coordination Teosto ry Layout Tuukka Lindqvist, Mogold Oy
Photos of the Board and the CEO Juha Törmälä Paper Edixion 250g, 140g Printing Libris Oy 2012
3
teosto
“ese days
ays I just write songs
so
all the time.
riting songs for oth
I like writing
other people too,
because it’s a good way to dispel
dis
the mood
llows aer releasing an album.”
that follows
Tuure Kilpeläinen, Selvis 4/
4/2011
4
TUOMO MANNINEN
tuure kilpeläinen has created a long career as a singer
and a songwriter. He has wrien songs and lyrics for several
well-known performers, and he has released three solo albums.
He has also released the albums Valon pisaroita (2010)
and Erämaa (2011) with the Kaihon Karavaani band.
5
review by the ceo
Giving voice to authors
teosto enables successful professional music-making in finland.
in addition to our basic mission, we promote the vitality and diversity
of finnish music while providing flexible solutions catering to the needs of
our music user customers. we do all this transparently and efficiently.
T
he year 2011 was a difficult one in economic terms, in Finland and worldwide.
Teosto, however, enjoyed a satisfactory
financial performance. People continue to listen to music
even in difficult times; distributions to music authors and
publishers actually increased
by EUR 1.4 million in the year
under review.
Royalties collected by Teosto in Finland amounted to EUR 45.3 million in the year under review, while
overall Teosto revenue increased to EUR 53.6 million.
e royalties collected by Teosto are paid out, minus
expenses, directly to the composers, lyricists, arrangers and music publishers. Teosto has been one of the
most efficient copyright organisations in Europe for
several years running. In 2011, our cost percentage
was 13.1%.
“Flexible, quick and
easy licensing of music
is a goal that Teosto
is actively striving for.”
the year 2011 was a parliamentary election year in
Finland, and this had an impact on operations at Teosto. We focused on lobbying on a number of fronts
to ensure that the voice of authors would be heard by
decision-makers.
e Government Programme of the Government
of Prime Minister Jyrki Katainen, wrien last June,
raised several issues important for music authors
and highlighted by Teosto: reform of the employment, social security and tax provisions concerning
those working in the creative industries; supporting
entrepreneurship; and promoting cultural exports. It
is now time to make good on the promises entered in
the Government Programme.
the importance of copyright as an incentive for creative work has been highlighted in a concrete way in
the ‘Cultural Ambassadors’ project, which was con-
6
tinued with success in the year under review. Nearly
every Member of Parliament and Finnish Member of
the European Parliament has already been assigned
a music maker as a Cultural
Ambassador.
e Cultural Ambassadors project is a fine example of how music authors
can collectively highlight
current and important matters. Teosto will be promoting such community activities in various ways in the
current year too.
flexible, quick and easy licensing of music is a goal
that we are actively striving for. Flexibility in licensing will promote the widerspread use of Finnish music. Last year, we introduced the new Online Licence
to make online use of music easier.
Online customer service will continue to be a focus for development in 2012. A completely revised online service for music authors was launched in February 2012 to streamline the submiing of work notifications and performance notifications. e new public Teosto website will be unveiled in course of the
current year.
teosto also invests in research to gain information
on the shiing markets and to be able to serve our
customers as well as possible. In the year under review, our research focused on consumers and on how
music is used and consumed, analysed by region. In
2012, we will be considering how the knowledge base
of Teosto can be leveraged more effectively for instance in research conducted by our partners.
e world of music is changing, and the changing
operating environment poses challenges for copyright
organisations too. In the future, copyright organisations must be more proactive and seek out partners
ς Royalty distribution to music authors and
publishers increased
ς We introduced more flexible ways of licensing and
using music online
ς e voice of the authors found resonance in
the Government Programme
in order to secure the operating potential of creative
individuals and entrepreneurs. Teosto has been doing
this for a long time, for instance in co-operation with
the other Nordic copyright organisations. In the year
under review, we sought closer contact with Koda in
Denmark and Tono in Norway. ese efforts are continuing, and joint Nordic efforts will concern shared
IT services, for instance. Partnership is an investment
that helps us prepare for the future.
we wish to promote international-calibre expertise
in the field of music in Finland, and we will be launching a training programme in the near future.
In addition to closer co-operation with other players on the music market, we also entered new areas
in the year under review: in the spring, Teosto and
Nokia jointly proposed that Finland should become
the world leader in combining revenue and development potential of the creative and technological sectors. In the current year, we will be exploring closer
co-operation for instance with the Federation of Finnish Enterprises. Broad-based co-operation is the best
foundation for the success of Finnish music authors.
In the future too.
there was also a structural overhaul on the Finnish musical scene during the year under review. Teosto was involved in creating the new Music Finland
association through a merger of the functions of the
Finnish Music Information Centre (FIMIC) and Music Export Finland (MUSEX). e purpose of this new
association is to promote awareness of Finnish music over a broad range and with a target-oriented approach, to improve the availability and use of Finnish
live music, recordings and sheet music in Finland and
abroad, and to contribute to music exports.
revenues
07
9,9
39,1
08
9,5
40,7
09
9,0
42,8
10
operational results
operating costs
eur million
9,4
36,3
Katri Sipilä
eur million
eur million
8,3
45,3
11
7,0
6,0
6,1
07
08
09
7,4
10
7,5
11
41,5
43,0
44,6
46,1
07
08
09
10
47,5
11
Royalties received from others
Royalties collected by Teosto
7
regulation & policies
Working for the music
author community
small languages and cultures need looking after.
it is imperative that the services of copyright organisations
are available near music authors and users.
T
he purpose of the safeguarding of interests undertaken by Teosto is to reinforce the political and legislative foundation for the success of Finnish music
authors. In the run-up to the parliamentary election of 2011, Teosto focused on lobbying. e
voice of the creative sector was reflected in the Government Programme of the Government of Prime
Minister Jyrki Katainen, which includes the following actions:
ς Support will be provided for cultural entrepreneurship and the generation of jobs within the
creative sectors.
ς Marketing skills within cultural exports and the
creative sectors will be promoted.
ς e system of fair compensation for private
copying will be revised to secure the financial
prerequisites for the activities within the sector
under the circumstances of rapid technological
development.
ς Illegal use of creative material will be restricted
by means of dissemination of information and by
developing legislation and more effective implementation thereof.
ς In order to improve the status of people involved
in the creative sectors, the need to reform
employment, social security and tax legislation
will be looked into cross-sectorally.
ς e importance of the creative sectors will grow
as new business opportunities open up. Efforts
will be made to encourage this activity by increasing financial contributions and recognising the
special characteristics of the sector.
Unleashing the growth potential of the creative sectors requires ensuring incentives for creative work
and the full leveraging of the potential of creative individuals. Teosto is convinced that improving incen-
8
tives for creative work will add growth potential for
new innovations, too. In 2012, Teosto aims to contribute to rapid implementation of the actions of the Government Programme.
trans-border co-operation
Teosto gathers up-to-date research and marketing
data to support its views, both by conducting studies itself and by acquiring information from outside
sources. For instance, Teosto is involved in the IPR
University Centre, which undertakes research and
training in the field of intellectual property rights.
In summer 2011, Teosto joined Gramex, the Finnish National Group of IFPI and the Finnish Musicians’
Union in donating EUR 525,000 to the University of
Helsinki for a Chair of Copyright Studies.
Teosto also seeks new openings and partnerships.
In spring 2011, Teosto and Nokia made a joint proposal for action on principles of a joint programme for
creative and technology sectors to make Finland a
world leader in integrating revenue creation opportunities and development conditions of creative and
technology sectors. Similar initiatives will be made in
the current year, and we will be exploring closer cooperation for instance with the Federation of Finnish
Enterprises.
the voice of authors in Europe
e European Union wields considerable influence
over issues important for Finnish authors. erefore
Teosto seeks to propound its views and opinions actively in Brussels too. In the year under review, Teosto
employees have had meetings with several MEPs, representatives of the Commission and officials at Finland’s EU Representation.
One of the dominant themes in European debate
was the Communication of the Commission concerning ‘A Single Market for Intellectual Property Rights’.
is document proposes, among other things, EU-level
legislation to govern copyright organisations. e transparent operating culture of the Nordic copyright organisations would be an excellent template for good copy-
TIMO AALTO
Paula Risikko, Minister of Social Affairs and Health, and music author Simo Ralli at the Cultural Ambassador meeting in Seinäjoki in autumn 2011.
right administration practices elsewhere in Europe.
e European Commission, aiming to boost the
internal market, intends to expand the domain of
copyright organisations to a European level. Here,
too, a good example of a practice already in place is
not far: Teosto is involved in the NCB-Hub co-operation of Nordic copyright organisations, the purpose
of which is to respond to the demand for copyright
licenses covering more than one country in the Nordic and Baltic countries. (for more on the NCB-Hub,
see p. 20)
While the overall trend in copyright administration is towards large units and economies of scale, we
must ensure that the status of small languages and
cultures is not undermined. is could happen if the
framework conditions of national copyright services
is compromised. Copyright organisations are an integral part of local cultural ecosystems, and the services
they provide to rightholders and users of copyrighted materials are close to the customer. is is a benefit for Finnish customers and Finnish culture that is
worth holding on to.
Sharing research and insights
Teosto research activities increased considerably in 2011. The main research focus was on more
efficient leveraging of information in Teosto’s
own operations and planning. Research consisted of market research, processing of data collected by Teosto and research co-operation with
companies, research institutions and universities.
Research activities were complemented by improved technology and market monitoring.
During 2011, one research focus was on how
consumers use music: concert attendance,
event attendance, buying recordings, listening
to the radio, watching TV, and above all using
digital music services.
A research project on the licensing of
user-generated content was also launched in
2011, and its results were presented at the Teosto autumn seminar.
Teosto was also involved in the AudioImager
research project conducted by Aalto University, exploring how user-generated content and
copyright-protected content are combined in
online services. The project received funding
from the Medialla maailmalle (Going global with
media) programme of the Finnish Funding Agency for Technology and Innovation (Tekes). Teosto had participated in the DCM – Digital Content Marketing project run by the University of
Jyväskylä and Aalto University in 2009–2010; its
concluding seminar was held at Teosto in March
2011. This too was a Tekes-funded project.
In autumn 2011, Teosto began planning the project Musiikin tekijänoikeudet 2010-luvulla (Music copyright in the 2010s). The purpose of this
project is to collaborate with business and university partners to explore how technological
advancements have influenced copyright administration. The project received funding from
the Ministry of Education and Culture.
Teosto also held a research seminar for academic researchers from various fields in autumn 2011 to discuss how Teosto’s knowledge
base could be better leveraged for research
purposes. The Teosto live music event statistics
project was presented at the seminar; the project continues in 2012.
9
JUHA ROININEN
regulation & policies
Attitudes to copyright have improved
According to the copyright barometer study commissioned by LYHTY
- The Creative Sector Artists, Employees and Entrepreneurs in Finland,
Finns are increasingly appreciating that copyright organisations are doing
the right thing. Attitudes to online piracy among young people have also
taken a turn for the better. The market research company Taloustutkimus Oy has been polling Finns for their attitudes to copyright, copyright
organisations and piratism about once a year since 2004.
What the Copyright Barometer tells us
™ 63% of respondents agree that the current practice of collecting
copyright royalties is appropriate, and only 9% disagree.
™ 75% of respondents agree (wholly or partly) that copyright organisations are doing the right thing, and 74% agree (wholly or partly)
that they are necessary.
™ 82% of respondents consider that copyright royalties facilitate the
continued creation of artworks, and 78% consider that copyright
royalties are good for Finnish culture.
™ An overwhelming majority of respondents (85%) knows that
online piracy is illegal. Only 14% approve of downloading pirated
files. On the other hand, one in five households (21%) do so.
™ In the previous study, 31% of young people (aged 15 to 24)
approved of distributing pirated files online – now only 11%.
10
JAKKE NIKKARINEN
™ 78% of respondents consider that music authors and performers
should be compensated for downloading of their music.
JUSSI VIERIMAA
JAKKE NIKKARINEN
Cultural Ambassadors form a bridge between politics and everyday life
Top le: Composer Heikki Elo and
Sampo Terho MEP shaking hands
at the Cultural Ambassador meeting in Brussels. Big photo: Lyricist
Sinikka Svärd is Cultural Ambassador to Member of Parliament Ilkka
Kantola. Lower le: Cultural Ambassadors Tuomo Prä)älä and Jyrki
Linnankivi. Right: Cultural Ambassador Kaija Kärkinen and Member of
Parliament Sanna Lauslahti.
The Cultural Ambassador project
launched by Teosto in 2009 was
continued in 2011, and nearly every Member of Parliament now has
a personal Cultural Ambassador, a
music author from his or her own
constituency. In the spring, ten
Finnish Members of the European
Parliament were also appointed
Cultural Ambassadors of their own.
Cultural Ambassadors allow MPs
to meet local music authors and to
acquaint themselves with current
issues in the creative sectors. Last
autumn, meetings between MPs
and Cultural Ambassadors were
held in Tampere, Turku, Helsinki, Espoo, Oulu, Seinäjoki and Jyväskylä.
There are already 150 pairs of Cultural Ambassadors and MPs. The
list of Cultural Ambassadors includes names such as Toni Wir-
tanen, Cheek, Jussi Chydenius,
Marco Hietala, Anna Eriksson, Maria Kalaniemi, Jorma Panula and
Olavi Uusivirta. Music authors
want to get their voice heard on
matters such as taxation and social security. The importance of
copyright as a requisite for creative
work has been brought home to
decision-makers through personal
contact with people active in the
creative sectors.
11
revenue for authors
12
MAARIT KYTÖHARJU
“Writing is an act of will,
and
d it gets easier year by
b year
and song by song.”
song
Mariska, Teostory
tory 1/2011
mariska is a songwriter, lyricist and singer who began
her career as a hip hop performer. She has wrien lyrics
for Jenni Vartiainen and Anna Puu, among others. She
has released three solo albums, to which she contributed
the lyrics and some of the music. She has also released the
album Mariska & Pahat Sudet (2010), which includes the
hit song Suloinen myrkynkeiäjä.
13
revenue for authors
Revenue for authors
teosto distributes the copyright royalties it collects to its
rightholder customers. in the year under review, eur 44.5 million
was distributed to music authors and publishers.
T
he highest decision-making body in Teosto, the General Meeting, has determined that the basic mission of the organisation is to enable successful professional music making in Finland. Teosto
achieves its purpose by effectively representing the
rights of music authors and by promoting their operating potential in many ways.
In 2011, Teosto distributed a total of EUR 44.5 million in performance and mechanisation royalties to
its rightholder customers. is was EUR 1.4 million
more than in the previous year. Of the total, EUR 21.2
million was paid to Finnish composers, lyricists, arrangers and their heirs and to music publishers, while
the remaining EUR 23.3 million was paid through Teosto’s sister organisations to foreign music authors
and publishers.
Of the EUR 45.3 million collected in copyright royalties in Finland in 2011, Teosto distributed EUR 39.4
million (86.9%, aer deducting expenses) to rightholder customers. Royalties collected in Finland
were distributed to those Finnish and foreign composers, lyricists and music publishers whose music
had been given public performances in Finland. Teosto also paid out EUR 8 million in royalties received
from its sister organisations and the Nordic mechanisation rights agency NCB to Finnish rightholders.
e majority (84%) of the copyright royalties from
performances are distributed to music authors, i.e.
composers, lyricists and arrangers, the remaining
16% going to music publishers.
Payments are made in respect to works that have
been performed in public, or released on a recording,
or borrowed from a public library. In 2011, 9,702 Finnish rightholders (music authors, music publishers and
estates) received copyright royalty payments. More
than 8,000 of these are music authors, and about 600
of them were paid more than EUR 5,000 by Teosto in
the course of the year under review.
Teosto processes vast amounts of information for
the distribution of performing rights royalties. For
the year 2010, for instance, six million performance
rightholders represented by teosto
age structure of rightholders
Women Men
631
24475
560
18128
587
19181
647
25159
1102
6157
611
20109
804
4372
566
3050
736
2827
408
1630
14
–
9
40
93
90
9
9
70
–7
9
60
–6
9
50
–5
9
40
–4
9
30
–3
11
20
10
er
09
20
–2
08
Un
d
07
Publishers Music authors
118
297
80
–8
217
697
78
111
ANDREI IMAGES
*e rap duo formed by Jare Brand and Ville Galle became a sensation last year. *ey received two Emma Prizes.
Brand and Galle joined Teosto as lyricist customers last January.
events involving 235,000 individual works were processed.
the year under review, 23% were women.
Women performers topping the music charts has
been commonplace for decades. Teosto has been involved in a collaborative effort of the music industry called Musiikkiviennin naistenklinikka (Women’s
Clinic for Music Exports) to encourage women to
also write and produce music and to engage in background activities in the industry.
ere is a heavy concentration of rightholder customers in the Helsinki metropolitan area: 43% of music author customers and 63% of publisher customers are based here.
increasing percentage of women
In 2011, 716 new music authors and 18 new publishers
joined Teosto. At the end of the year, Teosto had 25,806
rightholder customers, of which 647 were publishers.
e majority of these are men, women only accounting for 17%. e percentage of women is increasing, however, as women account for 21% of customers
aged 20 to 29 and an impressive 41% of customers aged
under 20. Of all the customers joining Teosto during
registered new works
7197
16568
5517
21753
5140
22296
3701
25552
performing and mechanical
reproduction right royalties
paid to finnish authors and publishers
total individuals 9,702
3801
22850
7426
performing right royalties paid
abroad and received from abroad
eur million
0,5
9,2
Received from abroad Paid abroad
0,2
6,0
1,3
2,8
0,3
3,6
0,4
0,8
1483
0,2
0,9
Sweden*
USA
UK
Germany France
Other
20
00
0
00
€
€
220
Ov
er
-2
00
50
00
00
0
€
-5
00
Registered on paper Online
11
10
10
10
00
09
er
08
Un
d
07
€
573
*A major part of this sum consists of royalties from works in
which the sub-publishing rights exist in Sweden.
15
revenue for authors
e percentages are even higher when we look at
distribution: the Helsinki metropolitan area receives
67% of the royalty distribution, followed by Tampere
and Turku at 10% and 5%, respectively. Other cities receive no more than 3% each.
employed in Sweden, Teosto invited its member organisations to submit proposals for puing together
a training package in 2013.
development of online services
In accordance with unanimous decisions by Teosto
members, a percentage of the performing rights royalties collected each year is used for promoting Finnish music. In 2011, this amounted to 6.7% of the performing rights royalties collected, or EUR 2.6 million.
In order to safeguard the ideological basis of Teosto operations and the continuity of actions to promote Finnish music, Teosto has set up a fund to promote Finnish creative music, the Teosto Fund.
A retained portion of national funds was used to
build up the initial capital of the Fund, EUR 1.4 million
in 2010 and EUR 1.3 million in 2011. Capital gains from
the sale of apartments owned by Teosto amounting to
EUR 1.3 million were also transferred to the Fund in
the year under review. At the end of the year, the Fund
capital amounted to EUR 4.6 million. Based on proposals from the investment commiee appointed by the
Teosto Board, an investment plan was confirmed for
the Fund and a fund manager appointed. Investment
activities have not been launched yet, however, due
to the uncertain economic situation.
e annual funds for music promotion are used by
Teosto for instance to support its member organisations – the Society of Finnish Composers, the Guild of
Light Music Composers and Authors in Finland (Elvis)
and the Finnish Music Publishers Association – funds
and foundations associated with them and the Music
Finland association.
Music Finland is a new association created
through a merger of the functions of the Finnish Music Information Centre (FIMIC) and Music Export Finland (MUSEX). e purpose of this new association is
“to promote awareness of Finnish music over a broad
range and with a target-oriented approach, to improve the availability and use of Finnish live music,
recordings and sheet music in Finland and abroad,
and to contribute to music exports”. Teosto is represented on the Board of Music Finland and is thus involved in its governance.
According to the most recent research data available (for 2009), the market value of Finnish music exports, all sectors combined, is about EUR 32 million.
Copyright royalties account for about EUR 6 million
of this. (Source: Music Export Finland)
In 2011, EUR 2.8 million was received from Teosto’s
sister organisations for performances of Finnish music abroad. About EUR 2.4 million of this came from
Europe and EUR 0.2 million from North America. e
principal market areas for Finnish music are Sweden,
Germany, the UK, France and the USA, which between
them account for 60% of the royalties received.
During the year under review, Teosto received notification of more than 26,000 new works. Of these, 86%
were submied online.
Teosto initiated a reform of its online service based
on feedback from music authors and performers. e
new, more user-friendly online service tailored to users’ wishes was rolled out in February 2012. e user
interface and appearance design are by Idean Oy, and
music authors who actually use the service participated in the design workshops.
e new service for music authors and performers is part of the complete overhaul of Teosto’s online
services. Online services for music users will be revised during 2012, and the new public Teosto website
will also be unveiled in the current year.
professional training
In 2011, Teosto held customer briefings for music authors in Kuopio, Seinäjoki, Jyväskylä and Helsinki,
with a special focus on agreements in the music industry. More customer briefings will be held in 2012,
and in addition to providing practical advice, the
agenda will include topics requested by customers.
Sweden’s huge success in music exports is ascribed, among other things, to an active pursuit of
training. Music can only be made professionally when
it is possible to make a living from music. Swedish
professional composers and lyricists gain a substantial portion of their income from the international
markets. Teosto aims to enhance Finnish expertise
of international calibre in the music industry by introducing new training in the field. Inspired by the
Musikmakarna university of applied sciences model
promotion of finnish music
eur 2.6 million
Other*
39%
Promotion of
music export 11%
Funding for national,
cultural purposes
50%
*Includes Teosto support provided for member
organisations and associated foundations and trusts.
16
promotion and export of Finnish
music
Music is made all around Finland
Teosto has 26,000 music author
and publisher customers, of whom
more than one third live in the
Helsinki metropolitan area. At the
end of 2011, 9,305 authors lived in
the Helsinki post code area: about
6,200 in Helsinki itself, about 1,000
in Espoo and about 780 in Vantaa.
a nexus for music authors: more
than 400 music authors live in Kallio. Concentrations of music authors may also be found in other
university cities.
The district of Kallio in Helsinki is
number of live music
events in 2010*
resident music authors /
post code area
Helsinki.......................................................7,000
Tampere......................................................2,000
Turku..............................................................1,500
Oulu...............................................................1,000
Jyväskylä........................................................900
Vantaa.............................................................800
Espoo................................................................700
Kuopio.............................................................700
Pori.....................................................................600
Joensuu...........................................................600
Helsinki............................................9,305
Tampere...........................................2,289
Turku...................................................1,789
Jyväskylä..........................................1,029
Oulu.......................................................985
Lahti.......................................................596
Seinäjoki..............................................520
Kuopio...................................................510
Joensuu................................................466
Hämeenlinna....................................444
Kokkola.................................................440
Vaasa.......................................................390
Pori...........................................................367
Rovaniemi ...........................................314
Kouvola ...............................................304
Rovaniemi
314
Oulu
985
*Live music events reported by
Teosto customers, about 40,000 in all.
The figure does not include concerts
given by symphony orchestras..
M/s Isabella
M/s Amorella
Silja Europa
Levitunturi Spa Hotel
Tavastia Club, Helsinki
Tunturihotelli, Saariselkä
Klubi, Turku
Galax Restaurant, Turku
Sibelius Academy, Helsinki
Restaurant Liberte, Helsinki
* Live music performance venues
reported by Teosto customers.
Kuopio
510
Kokkola
440
top 10 performance
venues in 2010*
Vaasa
390
Joensuu
466
Seinäjoki
520
Pori
367
Jyväskylä
1 029
Tampere
2 289
Lahti
596
Turku
1 789
Hämeenlinna
444
Kouvola
304
Helsinki
9 305
Music is an important part of life in Finland
In a consumer survey conducted by Teosto in the summer, 76%
of respondents said that they listened to a lot of music; 36% of
respondents considered that it
would be impossible for them to
give up listening to music. About
one third of the respondents were
or had been amateur instrumentalists or singers.
Asked about listening to mu-
sic, 70% of the respondents said
they listened to music on the radio on a daily basis, 18% on TV and
15% online. The age group 46 to
55 was the most active in listening to music on the radio, while
the age group 66 to 70 was the
most active in listening to music
on TV. Out of all respondents, 6%
said that they listened to music on
their mobile phone on a daily ba-
sis, and 10% on a weekly basis. Men
outnumber women in listening to
music in all other media except
TV. Predictably, listening to music online and on a mobile phone
was much more common among
young people.
The study was conducted by
Innolink Research Oy in June. The
respondent group consisted of
1,000 Finns aged 18 to 75.
17
music has meaning
Music has meaning
companies consider music important for their business.
teosto facilitates quick, easy and flexible licensing of music by negotiating
operating procedures with other parties in the music sector.
I
n 2011, Teosto collected EUR 45.3 in performing rights royalties in Finland, an increase of
5.8% on the previous year. By contrast, music mechanisation royalties paid by the Nordic
Copyright Bureau NCB* to Finnish composers,
lyricists and music publishers decreased by 11.8%, to
EUR 4.4 million.
Almost 62%, or EUR 28 million, of the royalties collected by Teosto came from the use of music on TV, on
radio and on the Internet. e royalties paid for the
use of music on commercial TV increased on the previous year. is growth is explained by the increase
in the number of commercial TV channels and the
amounts of music played on them: there were more
programme hours than in the previous years, and
programmes tended to use more music than before.
Royalties paid by commercial radio stations also
increased. is growth was mainly due to a highly favourable trend in the advertising sales and turnover
of the major radio stations. e actual amount of music played on the radio remained stable or even decreased somewhat.
Negotiations with RadioMedia, which represents
private radio stations, were actively pursued during
2011. e aim is to renew the framework agreement
on music use compensation between radio stations
and Teosto.
Teosto’s largest single customer is the Finnish
Broadcasting Company (YLE), with which Teosto
engages in close co-operation. e comprehensive
agreement signed by Teosto and YLE in 2011 covers
music use by YLE in five areas: radio, TV, online services, recording and concerts.
festival summer exceeded
expectations
Performing rights royalties from concerts and festivals increased by 9.2% on 2010. Only a handful of massive stadium concerts were organised, but the summer’s festivals exceeded expectations, many of them
having a record number of visitors.
By contrast, copyright royalties collected by Teosto
from rock clubs, dance venues and other smaller venues featuring live music decreased by about 1%.
In order to improve reporting on events, Teosto
entered into a co-operation agreement with a party
that is a major collector and publisher of event data.
e purpose of this agreement is to step up collection
of performing rights royalties and thus to improve
distribution to rightholders.
Altogether, live music generated some EUR 5.2 million in revenue, 5% more than in 2010.
Largest events in 2011 by ticket sales
1. Pori Jazz, Kirjurinluoto, Pori
2. Bon Jovi, Olympic Stadium, Helsinki
3. Provinssirock, Törnävänsaari, Seinäjoki
4. Ruisrock, Ruissalo, Turku
5. Flow Festival, Suvilahti, Helsinki
6. Iron Maiden, Olympic Stadium, Helsinki
7. Foo Fighters, Kalasatama, Helsinki
8. Ilosaarirock, Laulurinne, Joensuu
9. Roger Waters, Hartwall Arena, Helsinki
10. On The Beach: Rihanna, Hietaniemi, Helsinki
*The NCB (Nordisk Copyright Bureau) is a consortium formed by the Nordic copyright organisations Koda, Stef,
Stim, Teosto and Tono to handle mechanisation rights. It is based in Copenhagen.
18
MAARIT KYTÖHARJU / MEIDÄN FESTIVAALI
Meidän festivaali (‘Our festival’, formerly the Tuusulanjärvi chamber music festival) gained its largest audience ever
at its concerts at Järvenpää Hall in summer 2011. Pekka Kuusisto is the Artistic Director of the festival.
background music is important
According to a national survey conducted by Teosto
among its customers, more than half of the restaurants, shops, hairdressers and other enterprises that
use background music consider it important for their
business. Restaurants consider background music
very important.
Background music played in corporate premises,
restaurants and vehicles is a significant source of income for Teosto rightholders. e fees paid by any individual user of background music, however, are very
reasonable.
sources of domestic
performing right royalties
In 2011, about EUR 10 million in revenue from the
use of background music was collected. Nevertheless, the use of background music at workplaces and
in public transport continued to decline. One reason
for this is the continuing increase in the popularity of
personal portable music players.
online sales are still low
e mechanisation rights of Teosto rightholders are
administered by the NCB, which collects and distributes mechanisation royalties to music authors and
publishers represented by Teosto whose works are
sources of revenue
eur 53.6 million
customer using background music
total number 31,180
eur 45.3 million
Performing right
royalties from abroad 5%
Other 8%
Internet and
new media 3%
Concerts and
events 14%
Mechanical
reproduction
(NCB)* 9%
Other 2 %
Performing right
royalties from
Finland 84%
Radio and TV
59%
Other 1,000
Local authorities
and parishes 780
Sports and
exercise 900
Retail and
similar locations
15,000
Taxis and
buses 4,900
Background
music in
customer
premises 16%
Restaurants
8,600
*Distribution of mechanical reproduction rights to
Finnish rightholders
19
music has meaning
Nordic co-operation through the NCB-Hub
The NCB-Hub is a co-operative
body for Nordic copyright organisations; in addition to Teosto, Stim
from Sweden, Koda from Denmark and Tono from Norway are
involved. Teosto has been active in
pursuing co-operation through the
NCB-Hub.
The purpose of the project is
to offer trans-national online music services an easier route to the
Nordic and Baltic markets, offering customers the opportunity to
negotiate a single licensing agreement for the entire region. The
tariffs of each respective country
will be used.
Significant new music services
and video on demand (VOD) services were licensed through the
NCB-Hub in 2011, including Sony
Music Unlimited, Beatport, Rara-
used on records, films or advertisements.
Music mechanisation royalties from the NCB to
Finnish composers, lyricists and music publishers
decreased by 11.8%, to EUR 4.4 million. e declining
trend is due particularly to the continuing decline in
CD and DVD sales, which has not been compensated
for by online sales.
licensing supporting legal services
Online music services operating in Finland are either international online services or web shops run
by Finnish parties, mainly licensed and billed by the
NCB. In 2011, the NCB collected about EUR 1.1 million
in royalties for online music services in Finland. e
NCB paid Teosto a percentage of this consistent with
the use of works represented by Teosto in the services, about 20%.
Nordic licensing through the NCB-Hub was also
more active than before, and Teosto was closely involved in this arrangement. Teosto also negotiated directly with several online service providers. e development of new services and business models was
continued together with the service providers with
com, iTunes and Microsoft VOD
services.
Regardless of the above, all copyright organisations are free to negotiate bilateral agreements with
service providers. For instance,
Teosto renewed its agreement
with Spotify and initiated negotiations with YouTube, among others,
in 2011.
the aim of increasing the range of supply on the market during 2012.
Growth in online sales was also sought by simplifying and revising the licence products in this area.
One result of this was the Teosto Online Licence,
which replaced five previous online licensing products. Intended for companies, organisations and private individuals who use music on their websites,
the Online Licence is priced simply and transparently: the fee is based on the amount of music used and
the number of visitors to the website.
e number of users of consumer-oriented online
music services in Finland increased during 2011, but
the revenue stream to rightholders from online use of
music is still rather small. During the year under review, Teosto continued to promote the entry to market and growth of legal music services and to ensure
that rightholders receive fair compensation for the
use of their works in new services.
Finnish telecom operators have become increasingly significant distributors of AV content. Last
year, Teosto resolves important issues regarding the
licensing of content provision in close co-operation
Teosto and MaRa negotiate pricing of music in restaurants
Teosto and MaRa, the Tourism
and Restaurant Services association, began negotiations in September 2011 to resolve the longstanding dispute concerning music in restaurants. The dispute originated in 2006 when a tariff reform
by Teosto caused some restaurants
to be presented with a bigger bill
20
for copyright royalties. The dispute
between MaRa member enterprises and Teosto was eventually referred to a court for resolution.
The negotiations have been active and positive, and a mutually
acceptable result is expected early
in 2012. Even in the course of the
dispute, 99% of the MaRa member enterprises who are Teosto’s
music user clients have complied
with the revised tariff of 2006. Although the fees for restaurants
that play a lot of music went up,
the fees for a number of music
user customers went down.
MAIJA SAARI / LEHTIKUVA
Sielun Veljet made a long-expected comeback to a capacity crowd at Ilosaarirock in July.
and through pilot projects with nearly all of the major operators in Finland.
towards more flexible solutions
To promote broad-based and diverse use of music,
Teosto continued to develop its rightholder and music user customer relationships and stakeholder relationships with other actors and decision-makers on
the music market. e needs of music user customers
were surveyed and responded to by improving customer services and revising licensing products.
Teosto brought together actors in the field – music
producers, publishers and other copyright organisations – to discuss how to make licensing models simpler and more flexible for music user customers. e
aim of the discussion was to explore whether a music user customer could in the future apply for all the
rights required at a one-stop shop.
Direct marketing campaigns aimed at various target groups were implemented, by phone and by mail,
in order to secure sales of licensing products for background music. Teosto worked with the regional customer service representative of Gramex regarding
service for small and medium-sized music user customers in the Helsinki metropolitan area.
Companies marketing non-copyright music particularly for audiovisual productions continued to
market their services aggressively in Finland. Teosto
surveyed the needs of Finnish production companies
and broadcasters with regard to music use together
with several other actors in the field. e aim here
is to improve the status of copyright music in a stiff
competitive situation by promoting quicker and easier licensing.
A pilot project for commercialising information
was launched together with a nationally prominent
music user customer in the tourism and restaurant
business to explore the conversion of information
collected by Teosto into a form useful for customers.
Less Finnish music is played
Although Finnish music is favoured at dance venues
and recording sales of Finnish music hit record numbers in 2011, Finnish music was found to be in a decline
on radio and TV. Teosto began to explore the reasons
behind this trend and to consider how to reverse it.
In 2012, Teosto will be focusing on Finnish music and
how to promote its use.
21
compensation for private copying
Compensation for private
copying awaits reform
a reform of the compensation for private copying is being prepared in 2012.
the new system is expected to generate sufficient revenue for creators
and to contribute to the vitality of finnish culture.
I
n 2011, Teosto collected EUR 6.5 million in compensation for private copying, as much as in
2010. is means that the declining trend halted, but the revenue
was still a far cry from
the top years of the 2000s. In
2007, the compensation for
private copying brought in
EUR 15.5 million.
e poor result last year
and in previous years is due
to the fact that the compensation for private copying does not sufficiently apply to the copying devices principally used today. Originally created to compensate for private copying to audio cassees, the system still has not been extended for instance to cover
mobile phones and computers. e sheer volume of
copying has increased explosively, and today’s digital
copies suffer no degrading compared to the original.
Sales of tapes and discs to which the compensation
for private copying applies continued to decline. e
sales figures for MP3 players also dropped by almost
half, because these days music players are commonly integrated in mobile phones and hence not covered
by the compensation for private copying. e halting of the trend was aided by sales of personal video recorders (PVR) and external hard drives, which
were included in the coverage of the compensation for
private copying in 2011. ese
two categories accounted for
more than half of the revenue from compensation for
private copying.
e revenue from
the compensation for
private copying
generates new culture.
teosto and other organisations representing authors and producers repeatedly appealed to the Government to correct the downward spiral of the compensation for private copying. e list of devices covered should be updated to correspond to actual use.
As it is, the income of creative workers and entrepreneurs has declined even though there is more copying going on than ever. is has served to jeopardise
all the good things that the introduction of the compensation for private copying has achieved. Bodies
that award grants to new grass roots level productions, such as the Promotion Centre for Audiovisual Culture (AVEK), the Foundation for the Promotion
revenue and distribution from fair
compensation for private copying
number of recording devices sold
15 515
16870
EUR 1,000
07
08
09
10
Revenue Total fair compensation distributed
Distribution to Teosto’s rightholders
22
6 523
5 978
e Ministry of Education and Culture
decision is not yet available
6 482
6 100
970
1 432
1866
1872
8 891
8 472
11 877
11 833
Sales 2011
11
External hard drive
Sales 2010
Change
149 000
Personal video recorder
112 000
101 000
11 %
Audio recorder
102 000
169 000
-40 %
CD-R
3 460 000
4 750 000
-27 %
DVD
2 340 000
3 000 000
-22 %
Blu-ray
9 500
10 000
-5 %
C cassee
58 000
58 000
0%
VHS cassee
25 000
43 000
-42 %
Research data on compensation for private copying
According to a study conducted
by Statistics Finland (2011), 39% of
Finns have copied, saved or transferred music files to digital devices,
and 57% of Finns have saved video
files. The most common practice
is to copy music tracks from original CDs and video files from TV
broadcasts. Most of the copying of
music and video content to a variety of platforms comes under private copying, which is legal.
The most commonly used platforms for copying music or video
material in Finland are personal
video recorders, computers and
mobile phones. New ways of using
content, such as streaming services
on the Internet, have not yet had
an appreciable impact on the volume of private copying.
These figures are based on
studies commissioned by a joint
committee of device retailers and
the creative sector. A total of 17
studies were commissioned between 2008 and 2011.
What is the compensation for private copying?
It is legal for consumers to copy
copyright-protected works for
their own personal use. This is an
exception to the general principle enshrined in copyright law
whereby authors have the exclusive right to decide on the use of
their works. Therefore rightholders are paid compensation which
is collected in the form of a fee
added to the price of copying
devices.
In Finland, the compensation
for private copying covers devices
in or on which copyrighted works
can be stored and which are used
for private copying to a significant
extent.
of Finnish Music (LUSES) and the Finnish Performing Music Promotion Centre (ESEK), have had to reduce their grants substantially.
e Minister of Culture submied a proposal to
Government incorporating phones and computers
into the list of devices subject to the compensation
for private copying. e Government, however, decided that the list of devices would not be changed; but
the amount of the compensation for private copying
was increased for personal video recorders converters and external hard drives. e Ministry of Education and Culture estimates that despite this increase,
the revenue in 2012 will remain under EUR 8 million.
the government’s ministerial working group on education policy decided that a reform of the system of
compensation for private copying will be prepared during 2012. e new system is intended to enter into force
from the beginning of 2013. According to the Ministry of
Education and Culture, the aim is “a system more predictable than the present one that would also ensure
fair compensation to authors, safeguard trade and Finnish jobs, and be as simple to administer as possible”.
Teosto feels that a successful reform requires a
new system that is broad-based enough and will ensure sufficient revenue for music authors. is will
have a direct impact on Finnish culture and the creative economy.
e ministry of Education and Culture confirmed
Teosto as the body collecting the compensation for
private copying for the next period (2012–2016).
The Ministry of Education and
Culture decides on an annual basis
how the revenue from the compensation for private copying is
to be divided. Some of the revenue is distributed directly to music
authors, while a portion is reserved
for common purposes such as cultural foundations.
the ministry of education and culture’s 2011
decision on the allocation of revenue received in
2010 as fair compensation for private copying
Direct compensation to rightholders
EUR
Distributing organisation
Kopiosto
1,263,993.45
Gramex
1,038,564.13
Teosto
968,310.70
Tuotos
186,316.00
Total
3,457,184.28
Funds to be used for common purposes
Promotion Center of Audiovisual Culture AVEK
1,195,000.00
Foundation for the Promotion of Finnish Music LUSES
365,000.00
Finnish Performing Music Promotion Centre ESEK
388,000.00
ESEK / LUSES *
256,000.00
Finnish Copyright Society
Copyright Information and Anti-Piracy Centre
in Finland CIAPC
64,500.00
150,000.00
Promotion Centre for Literary Arts
58,000.00
Promotions Centre of Visual Arts VISEK
17,000.00
Finnish Association of the Deaf
Total
To be decided later by the Ministry of Education
and Culture
Grand total
3,500.00
2,497,000.00
146,306.21
6,100,490.49
*Includes common audiovisual funds of LUSES and ESEK
23
compositions performed most often
Compositions performed
most oen in 2010
live music at dance venues has traditionally been overwhelmingly of
domestic origin in finland; in 2010 too, 81% of the music played by dance
c authors.
bands was by finnish music
T
he percentage of Finnish music is some-what lower at festivals and concerts. Att
festivals in Finland, for instance, Finn-ish music accounted for 62% of the programmee
in 2010. Finnish music accounted for 31% of thee
programming of commercial radio, 27% of thee
programming of the national radio channels off
YLE, and 48% of the programming of regionall
radio stations.
ese figures are based on music perfor--
mance notifications submied to Teosto by
event organisers, radio and TV companies, and
performers. It is on the basis of these notifications that Teosto pays Finnish and foreign composers, lyricists, arrangers and music publishers royalties for the use of their works. Teosto
paid out the performing rights royalties from
performances in 2010 to rightholders in 2010
and 2011. Statistics on performances in 2011 will
be completed in summer 2012.
ILKKA HÄMÄLÄINEN
live music in 2010
1. Paratiisi
music Rauli Somerjoki, lyrics R. Somerjoki, Arja
Tiainen, publ. Warner/Chappell Music Finland
2. Keinu kanssani (Quien sera)
music and lyrics Pablo Rosas Rodriguez, Finnish
lyrics Ulla Sand, publ. Peermusic
3. Ikkunaprinsessa (Glendora)
music and lyrics Ray Stanley, Finnish lyrics Saukki,
publ. Emi Music Publishing, Warner/Chappell Music
Finland, Edition Wilhelm Hansen
4. Satumaa
music and lyrics Unto Mononen, publ. Warner/
Chappell Music Finland
5. Jätkän humppa
music Paavo Melander, lyrics Tupa-Uuno, publ.
Warner/Chappell Music Finland
6. Kulkurin iltatähti
music Toivo Kärki, lyrics Reino Helismaa, publ.
Warner Chappell Music Finland
7. Se jokin sinulla on (You’ve Got What I Like)
music and lyrics Gerard Marsden, Leslie Maguire, Les
Chadwick and Frederick Marsden, Finnish lyrics Juha
Vainio, publ. Universal
8. Valot
music and lyrics Rauli Somerjoki, publ. Warner/
Chappell Music Finland
9. Kaksi kolpakkoa neiti
music and lyrics Martti Maja, publ. Warner/Chappell
Music Finland
10. Oikeesti
music Kaisa Ranta-Toivonen, lyrics Sinikka Svärd, arr.
Aku Toivonen, publ. Finlanders Productions Oy
24
finnish compositions most performed
abroad, by royalties collected, in 2010
excluding compositions by jean sibelius
Lauri Ylönen
finnish compositions most performed
abroad, by royalties collected
1. Violin Concerto
music Jean Sibelius, publ. Robert Lienau
2. Symphony no. 2
music Jean Sibelius, publ. Breitkopf & Härtel
3. In the Shadows
music Lauri Ylönen, Eero Heinonen, Aki-Markus
Hakala and Pauli Rantasalmi, lyrics Lauri Ylönen,
publ. Boneless-Skeletor Oy, Grotto Entertainment
4. Symphony no. 1
music Jean Sibelius, publ. Breitkopf & Härtel
5. Lemminkäinen Suite
music Jean Sibelius, publ. Breitkopf & Härtel
6. Symphony no. 5
music Jean Sibelius, publ. Edition Wilhelm Hansen
7. Finlandia
music Jean Sibelius, publ. Breitkopf & Härtel
8. What Did I Do
music and lyrics Crazy Kid and Martti Vuorinen,
publ. Bonnier Music Publishing, HMC - Helsinki
Music Company
9. Karelia Suite
music Jean Sibelius, publ. Breitkopf & Härtel
10. Symphony no. 7
music Jean Sibelius, publ. Edition Wilhelm Hansen
1. In the Shadows
music Lauri Ylönen, Eero Heinonen, Aki-Markus
Hakala and Pauli Rantasalmi, lyrics Lauri Ylönen,
publ. Boneless-Skeletor Oy, Grotto Entertainment
2. What Did I Do
music and lyrics Crazy Kid and Martti Vuorinen,
publ. Bonnier Music Publishing, HMC - Helsinki
Music Company
3. Arn (TV series)
music Tuomas Kantelinen
4. Rikostarinoita Suomesta
music Jussi Aronen and Vesa Mattsson
5. Mongol (film music)
music Tuomas Kantelinen
6. LR Löytöretki
music Osmo Ikonen, Kimmo Laiho and Sakari Aalto,
publ. Elastinen Live Arts
7. Sandstorm
music Ville Virtanen, arr. Jaakko Salovaara and Ville
Virtanen, publ. BMG Music Publishing Finland
8. Freestyler
music Jaakko Salovaara, lyrics Raymond Ebanks,
publ. Lebaron Music
9. Join Me in Death
music and lyrics Ville Valo, arr. Mikko Lindström,
Mika Karppinen, Mikko Paananen and Jussi-Mikko
Salminen, publ. Heartagram
10. The King of Rock’n Roll
music and lyrics Mikko Lindström and Ville Valo,
publ. Heartagram
yle radio channels*
commercial
radio stationss
1. En haluu kuolla tänä yönä
music and lyrics Jukka
ukka Immonen,
Jenni Vartiainen and
nd Mariska,
publ. Air Chrysalis Scandinavia
2. Hot’n Cold
ukasz Gottwald,
music and lyrics Lukasz
aty Perry, publ.
Max Martin and Katy
lishing, Warner/
Kobalt Music Publishing,
candinavia
Chappell Music Scandinavia
iin
3. Jos sä tahdot niin
music and lyrics Hector
ector
4. Need You Now
w
music and lyrics David
avid Haywood,
Charles Kelley, Josh
h Kear and
Hillary Scott, publ.. Warner/
candinavia, Emi
Chappell Music Scandinavia,
Music Publishing Scandinavia,
gs
Scandinavian Songs
5. Missä murusenii on
ukka Immonen,
music and lyrics Jukka
nd Mariska,
Jenni Vartiainen and
publ. Air Chrysalis Scandinavia
6. Umbrella
hristopher
music and lyrics Christopher
ash, Thaddis
Stewart, Terius Nash,
Harrell and Shawn Carter, publ.
Sony/ATV Music Publishing,
Warner/Chappell Music
music, Emi
Scandinavia, Peermusic,
Music Publishing Scandinavia
7. Alejandro
tefani
music and lyrics Stefani
Germanotta and Nadir Khayat,
publ. Sony/ATV Music Publishing
8. Stereo Love
dward Maya
music and lyrics Edward
and Vika Jigulina, publ. Emi Music
navia
Publishing Scandinavia
9. Tämä on totta
tti Mikkola
music and arr. Matti
ra, lyrics Annaand DJ Street Kobra,
Leena Härkönen and Laura Närhi,
hing, Universal
publ. HMC Publishing,
Music
10. Sama nainen
hristel
music and lyrics Christel
MC-Helsinki
Sundberg, publ. HMC-Helsinki
Music Company
1. Työlki ellää
music and lyrics Timo Kiiskinen,
arr. Susan Aho, Johanna Virtanen,
Jetro Vainio and Tom Nyman
2. Missä muruseni on
music and lyrics Jukka Immonen,
Jenni Vartiainen and Mariska,
publ. Air Chrysalis Scandinavia
3. Kosketusta vailla vapiseva
mies
music and lyrics Tuure
Kilpeläinen, arr. Jape Karjalainen,
Tuure Kilpeläinen, Jaakko
Kääriäinen, Pessi Levanto, Markus
Nyman and Marko Timonen
4. Valon pisaroita
music and lyrics Tuure
Kilpeläinen,
arr. Sampo Haapaniemi,
publ. HMC Publishing
5. Poutaa
music Kari Pesonen, lyrics Kari
Pesonen and Erkki Vuokila
6. Näiden tähtien alla
music Jari Latomaa and Jussi Selo,
lyrics Jussi Selo, arr. Janne Selo,
Teemu Rajamäki, Pasi Viitala,
Antti Matikainen, Jussi Selo,
Jari Latomaa, publ. Universal
Music, Afterglow Music
7. Jos menet pois
music and lyrics Leri Leskinen,
Jonne Aaron and Samuli Laiho,
publ. Warner/Chappell Music
Finland
8. Tule tyttö
music and lyrics V.V. Riihiluoma,
publ. Hype Productions
9. Hiljaisia päiviä
music and arr. DJ Street Kobra
and Matti Mikkola, lyrics Laura
Närhi, publ. HMC Publishing,
Universal Music
10. Rakkauslaulu
music Lauri Ylönen, lyrics Paula
Vesala, arr. Markus Koskinen and
Sampo Haapaniemi,
publ. Boneless-Skeletor
*Includes the YLE Finnish and
Swedish language radio stations
Radio Suomi, YleX, Radio Vega
and X3M. The playing times of
the Radio Suomi nationwide
broadcast and of the 20 local
radio stations are counted
together.
Jenni V
Vartiainen
25
JAKKE NIKKARINEN
events from 2011
Le to right: Sebastian Fagerlund, Tapani Rinne,
Wimme Saari, Chisu and Tuomas Norvio.
Diversity of Finnish music
JAKKE NIKKARINEN
on the disc Vapaa ja yksin recorded by Chisu; and Wimme Saari, Tapani Rinne and Tuomas Norvio for the works on the disc Mun. The prize is
EUR 40,000 and has been awarded annually since 2003.
JAKKE NIKKARINEN
The diversity of Finnish music was once again highlighted in an excellent
way in the awarding of the Teosto Prize in April 2011. The prize was shared
between Sebastian Fagerlund for Ignite; Christel Sundberg for her works
Suvi Teräsniska and Hanna Kuosmanen,
managing director of Finnish Metal Events.
Le to right: Anni Sinnemäki, Jua Urpilainen,
Paavo Arhinmäki, Anne-Mari Virolainen and Timo Laaninen.
Rapporteur of the Year prizes awarded
Copyright, politics and creativity
Finnish Metal Events, organisers of the Tuska festival, received the
organisers’ Rapporteur of the Year prize in April 2011, while singer Suvi
Teräsniska received the performers’ Rapporteur of the Year prize. With
these prizes, music authors and publishers reward performers and event
organisers who are scrupulous in submitting information on the music
performed at their gigs and the ticket sales.
Top names of Finnish politics came to a panel discussion organized by Teosto
to talk about copyright issues and creative industry: Anni Sinnemäki (Green
Party), Jutta Urpilainen (Social Democratic Party), Paavo Arhinmäki (The Left
Alliance), Anne-Mari Virolainen (The National Coalition Party) and Timo Laaninen (The Centern party).
26
JAKKE NIKKARINEN
PETRI FLANDER
Music authors run the marathon
The Kullervo Linna Prize for 2011 was given to singer Anneli Saaristo
and singer and songwriter Timo Kiiskinen. Both received EUR 4,200. The
Kullervo Linna Prize has been awarded since 1989. Composer, conductor
and musician Kullervo Linna, who died in 1987, bequeathed his royalties
from Teosto and other sources to a foundation which is to award prizes
and grants to music authors and performing musicians.
The Musamaraton (Music marathon) organised by Teosto was run in connection with the Finlandia Marathon in Jyväskylä in September. There
were 74 music authors and industry leaders participating, including names
such as Mariska, Simo Ralli and Jouni Hynynen, the latter one of the instigators of the event. Music authors and music users also met at the second
annual Musagolf (Music golf) event organised by Teosto in September.
JAKKE NIKKARINEN
Winners of the Kullervo Linna Prize
Music author panel at the seminar Sisältöä elämään – ja verkkoon (Content in life – and online).
Le to right: moderator Riku Vassinen and music authors Jari Salo, Olli Virtaperko and Elastinen.
Content in life – and online
The Teosto autumn seminar on 10 November, Sisältöä elämään – ja verkkoon (Content in life – and online), focused on the phenomenon of user
generated content. Music authors, service providers and audience members discussed whether music made by others should be allowed to be
used for users’ own remixes and online videos, and if so, on what financial
and moral terms. Teosto also presented its preliminary ideas for a music
use licence for the consumer trade in digital rights and challenged other
parties in the sector to contribute to this development.
The spring seminar on 22 March focused on the Potential of the creative
economy; the panellists included Anni Sinnemäki, the Minister of Employment; Professor Alf Rehn from Åbo Akademi University; and Janne
Viemerö, CFO of Tekes.
27
organisation
“Composing is a cra. It is like
assembling a puzzle, one piece at
a time. Oen the project guides you,
prompting new ideas.”
Timo Alakotila, Teostory 4/2011
28
SAARA VUORJOKI / FIMIC
timo alakotila is a composer, arranger, musician, producer and
teacher. He plays with a number of ensembles, including JPP and Nordik
Tree. His recent compositions include string quartets for the Meta4
quartet and the Felis Quartet (2010), a concerto for harpsichord and string
trio (2011, soloist: Marianna Henriksson), and his Violin Concerto no. 2
(2011, soloist: Piia Kleemola).
29
organisation
General Meeting and
Board of Directors
the supreme decision-making body in teosto is the annual general meeting,
at which each ordinary member has one vote. at the end of the year under
review, teosto had 680 ordinary members, of whom 639 were music authors
and 41 were music publishers.
T
wo General Meetings are held each year.
A music author or publisher who is a
customer of Teosto may apply for Teosto
membership. Day-to-day maers and administration at Teosto are managed by the Board of Directors, whose chairman and members are elected by the General Meeting. e Board has one
member from each group of music authors (popular and contemporary music composers and
lyricists), one member representing all authors,
and two members representing music publishers. Half of the members of the Board of Directors are up for re-election each year.
In 2011, the Statutory Spring Meeting was held
on 13 April and the Statutory Autumn Meeting on 14 December. e Spring Meeting unanimously elected composer Kim Kuusi the chair-
man of the new Board of Directors. Tom Frisk
and Timo Tyrväinen were up for re-election
and were unanimously re-elected, although
Tyrväinen’s mandate changed to that of lyricists and writers. e Board of Directors reelected Mikko Heiniö as deputy chairman.
ere were 149 and 63 members present at the
Spring and Autumn Meetings, respectively. e
Board of Directors met 15 times during the year.
board of directors, 13 april 2011 to 18 april 2012
30
heikki elo
tom frisk
kim kuusi
member, composer
member, publisher
chairman, composer
“Content has value.
e author deserves
part of that value.”
“When the music
author does well,
the publisher does well.”
“Without music,
life would be a mistake.”
(Friedrich Nietzsche)
JAKKE NIKKARINEN
teosto organisation on april 1, 2012
CEO
Katri Sipilä
Lyricist Georg Nummelin (right) was the chairman
of Teosto until the Spring Meeting on 13 April 2011.
Beside him is the current chairman Kim Kuusi.
Regulatory and policy affairs
Martti Kivistö
Legal Affairs
Risto Salminen
Finance, Administration and HR
Petri Kauste
Communications
Tomi Korhonen
Rightholder Services
Satu Mättö
Music Solutions
Kari Paananen (Deputy CEO)
Support Services
Lea Valkeajärvi
mikko heiniö
ari nieminen
timo tyrväinen
deputy chairman, composer
member, publisher
member, lyricist
“Ignorance is not innocence but sin.”
(R. Browning) but “Imagination is
more important than knowledge.”
(A. Einstein)
“Upholding diversity in
Finnish musical culture is the key
to future success stories.”
“We must safeguard
the survival of the Finnish
music author as a species.”
31
organisation
Commiees and
working groups in 2011
the private copying committee monitors
developments in the equipment used for copying and in consumer markets, international
developments in the regulations concerning
the compensation for private copying, and the
practical arrangements for paying the compensation in different countries. It also monitors
developments in the volume of copying and in
the equipment and techniques used for copying, and operates as a communication link between copyright organisations and the manufacturers and importers of equipment. In 2011,
copyright organisations were represented on
the Commiee by Mari Kivistö, Turo Pekari,
Katri Sipilä and Olli Valkama from Teosto; Lauri Kaira and Hannu Marila from Gramex; Kirsi Niiyinperä from Tuotos; and Pekka Rislakki from Kopiosto. Other members were Riia
Raatikainen from the Association of Electronics Wholesalers; Minna Jokinen from Nokia plc;
and Riikka Tähtivuori from the Confederation
of Finnish Industries EK. e Consumer Agency representative was Hera Hartikainen, and
the National Consumer Research Centre representative was Peeri Repo. e Ministry of
Education and Culture was represented on the
Commiee by Viveca Still.
the repertoire committee discusses questions concerning the classification of works
and defines the shares payable to arrangers of
works that are in the public domain. It issues
statements to rightholders concerning moral
rights, the exceeding of work thresholds and
issues related to plagiarism. e Commiee
will continue to grade works to the extent required by Nordic distribution practice as long
as such grading is necessary. e chairman of
the Commiee is Reijo Kekkonen. e secretary and repertoire expert is Jenna Vainio. e
Commiee members are Carita Holmström,
Kim Kuusi, Tommi Lindell, Jussi Liski and Olli
Virtaperko, and the deputy members are Yrjö
Hjelt, Ari Nieminen and Lauri Kilpiö.
the online committee monitors trends in
the online market and submits proposals to the
Board of Directors as necessary. e Committee includes author and publisher representatives Ani Auvinen, Janne Louhivuori, Eero
Lupari, Pekka Sipilä and Tommi Tuomainen
(chair) and Teosto administrative representatives Olli Honkkila (secretary) until May 2011
32
/ Lumi Vesala from summer 2011, Jani Jalonen
and Satu Mäö.
the reporting committee discusses current
issues concerning the reporting of performances and makes recommendations to the Board
of Directors for the development of reporting. e Commiee was chaired by Timo Forsström until 15 June and by Eija Hinkkala from
15 June, with Piia Keskimaa as secretary and
Lauri Kilpiö, Saara Närhi and Ville Mäkinen as
members.
the arbitration committee discusses cases
where rightholders are of the opinion that the
terms of a publishing agreement have not been
observed. e Commiee is chaired by Mikko
Huuskonen, with Susanna Otsola as secretary
and Janne Louhivuori, Harri Suilamo and Pekka Sipilä as members.
the commission grant committee distributes funds intended to promote newly-commissioned Finnish score music primarily to those
musicians, orchestras and other communities
that do not receive any significant amount of
public support. e members of the Committee are Raine Ampuja, Yrjö Hjelt, Jukka Isopuro,
Reijo Kekkonen, Jenna Vainio (secretary) and
Harri Vuori.
the distribution and division rules committee prepares calculations of distributable
royalties and updates the distribution and division rules. It also ensures that the distribution
and division rules are transparent and ensure
equitable treatment of works. e Committee was chaired by Mari Heikkilä, with Pekka Sipilä as deputy chairman, and its members
were Heikki Elo, Janne Louhivuori, Annu Mikkonen until 7 September, Tapio Tuomela from
7 September and Tommi Tuomainen. e deputy members were Eija Hinkkala, Ari Nieminen,
Tapio Tuomela until 7 September and Riikka Talvitie from 7 September. e Teosto administrative representatives on the Commiee
were Satu Mäö (secretary) until 15 June / Piia
Keskimaa (secretary) from 15 June, Reijo Saari
(presenter) until 31 August, Marja Isokangas
and Petri Kauste.
the purpose of the future working
group is to monitor changes in Teosto’s oper-
ating environment and local and international regulation applying to our field. e Working Group submits suggestions and proposals
to the Teosto Board of Directors in addition to
draing future scenarios with the aid of which
Teosto aims to respond proactively to emerging situations, market changes and regulation.
e members were Tom Frisk, Jari Muikku until 11 May, Alex Nieminen until 11 May, Georg
Nummelin until 11 May, Kim Kuusi from 11 May,
Katri Sipilä, Ano Sirppiniemi (secretary) and
Timo Tyrväinen.
the supervision working group discusses problems associated with incorrect performance or work registrations. e chairman was Piia Keskimaa until 15 November and
Janne Louhivuori from 15 November, the secretary was Sami Tenhunen until 31 March and
Juho Kaitamaa from 15 November, and the other members were Kirsi-Marja Forsberg, Juhani
Leinonen, Janne Louhivuori until 15 November,
Harri Suilamo and Tommi Tuomainen.
the public relations working group surveys and plans public relations projects necessary for Teosto, and tests and carries out lobbying ideas. e Working Group was chaired
by Georg Nummelin until 15 June and by Kim
Kuusi from 15 June. e members were Mikko
Heiniö, Mika Kauhanen (secretary) until 15
June / Susanna Perämaa from 15 June, Tomi
Korhonen, Mari Kivistö and Katri Sipilä.
the purpose of the co-operation forum is
to enhance communication of information between the Board of Directors of Teosto, member organisations and members and to help utilise the expertise of member organisations in
the operations of Teosto. e Forum includes
the Board of Directors of Teosto and also Katri
Sipilä, Kari Paananen and Mari Kivistö from
Teosto, Jua Jaakkola from FIMIC, Eija Hinkkala and Janne Louhivuori from Elvis ry, Annu
Mikkonen and Tapio Tuomela from the Society of Finnish Composers, and Pekka Sipilä and
Tommi Tuomainen from the Finnish Music
Publishers Association. e deputy members
were Eero Lupari and Riikka Talvitie until 15
June and Ani Auvinen from 15 June. e tax
working group of the Co-operation Forum comprises Mari Heikkilä, Annu Mikkonen, Satu
Mäö, Risto Salminen and Pekka Sipilä.
Customer’s Teosto
teosto’s vision for 2015 is: “teosto is the most active and competent solution
provider in the finnish music market.” a customer-oriented approach and
creativity were the guidelines for personnel development in 2011.
KIRSI-MARJA FORSBERG
the ‘Customer’s Teosto’ operating culture approach launched in autumn 2010 features themes
such as ‘Fixing the front yard’, ‘Added value to
customers’ and ‘Unleashing creativity’. An overhaul of the operating culture was considered vital for the aainment of Teosto’s vision. e principal purpose of the Customer’s Teosto project
was to focus on ideas, sharing of information and
working in teams across unit boundaries.
the ‘Unleashing creativity’ theme was
fuelled by building the ‘Ideas mill’ concept,
which was kicked off by the performance coaching organised in 2010. e purpose of the ‘Ideas
mill’ was to gather employee ideas for improving Teosto operations and to process these ideas
further at joint sessions. More than 1,000 ideas
were received. But the best outcome of the ‘Ideas mill’, according to personnel feedback, was
learning to work with people from other units.
the change in operating culture was also supported through supervisor training. Immediate supervisors were considered to play a crucial role in the adoption of new practices. Sparring support was developed as an aid for supervisors. At personnel coaching sessions, everyone was given the task of considering how the
Teosto vision could be aained.
teosto was one of 87 workplace communities in 2011 to participate in the ‘Spiral of Inspiration’ nationwide research project run by the
Finnish Institute of Occupational Health. e
purpose of this project was to explore the key
resources of workplaces that promote wellbeing
at work, effectiveness of work and innovation.
teosto had 87 permanent employees at the
end of 2011, a slight decrease on the previous
year. is includes the Private Copying Unit.
Teosto also hired two non-military servicemen,
bringing total personnel up to 89 at the end of
the year. Personnel consisted of 58.6% women
and 41.4% men. Over the past five years, the percentage of men has increased by 14.5 percentage
*e personnel visited the new Musiikkitalo on the workplace community day in September.
points. e average age of employees at the end
of the year under review was 44.8 years, and the
average length of service was 13.1 years.
the ncb board of directors adopted a restructuring programme in 2011 to balance its finances, and in early December decided to concentrate the processing of one-off licences in
Copenhagen. e Teosto Board of Directors discussed at its meeting on 14 December how the
NCB decision will affect Teosto: the current Teosto functions for granting one-off audio, AV
and advertising licences will be discontinued
in autumn 2012. Teosto conducted the statutory codetermination negotiations with the employees affected by the restructuring measures
before any decisions were made. Because of the
centralising of functions, Teosto has a need to
reduce personnel by three people as of 1 October 2012.
33
finacial statement
income statement
1.1. - 31.12.2011
1.1. - 31.12.2010
45,304,812.30
42,808,634.17
8,018,496.18
8,371,555.04
DAY-TO-DAY OPERATIONS
Income
Royalties collected by Teosto
Royalties from other organisations
Remuneration for public lending
Compensation for private copying
Other income
306,714.57
668,812.28
6,522,901.91
6,487,112.90
120,000.00
120,000.00
60,272,924.96
58,456,114.39
-5,644,038.79
-5,667,693.47
Costs
Personnel costs
Depreciation
-253,673.29
-284,288.81
-3,623,170.56
-3,135,915.76
-9,520,882.64
-9,087,898.04
50,752,042.32
49,368,216.35
78,791.87
54,454.47
50,830,834.19
49,422,670.82
Income
3,397,615.56
1,959,639.50
Costs
-733,739.42
-252,066.97
2,663,876.14
1,707,572.53
53,494,710.33
51,130,243.35
-50,876,866.00
-49,688,186.89
-2,617,844.33
-1,442,056.46
0.00
0.00
Other costs
FUNDRAISING
Membership fees
INVESTMENTS AND FINANCING
Transfer for distribution to rightholders
Changes to the self-financed reserve
SURPLUS/DEFICIT FOR THE FINANCIAL YEAR
34
balance sheet
ASSETS
31.12.2011
31.12.2010
2,135.99
2,135.99
NON-CURRENT ASSETS
Intangible assets
Intangible rights
Other capitalised long-term assets
204,663.88
269,077.00
206,799.87
271,212.99
18,916.68
18,916.68
Buildings and constructions
184,632.92
192,325.96
Machinery and equipment
502,091.50
546,529.54
705,641.10
757,772.18
13,024,884.61
12,754,213.20
Tangible assets
Land and water
Investments
Shares and similar rights of ownership
Other investments
TOTAL NON-CURRENT ASSETS
0.00
334,018.07
13,024,884.61
13,088,231.27
13,937,325.58
14,117,216.44
4,637,793.25
2,019,948.92
7,625,723.26
6,568,590.58
ASSETS OF SELF-FINANCED RESERVE
Cash in hand and at the bank
CURRENT ASSETS
Receivables
Trade receivables
Loan receivables
Prepayments and accrued income
38,918.27
48,467.19
657,946.95
882,068.36
8,322,588.48
7,499,126.13
4,517,215.69
13,032,189.21
Financial securities
Shares
Cash in hand and at the bank
TOTAL CURRENT ASSETS
TOTAL ASSETS
27,940,106.43
18,779,404.13
40,779,910.60
39,310,719.47
59,355,029.43
55,447,884.83
35
finacial statement
balance sheet
LIABILITIES
31.12.2011
31.12.2010
Capital and reserves
Self-financed reserve
Teosto Fund
Surplus/deficit for the financial year
Total capital and reserves
4,637,793.25
2,019,948.92
0.00
0.00
4,637,793.25
2,019,948.92
Debts
Trade debts
270,016.11
251,436.22
Other debts
6,093,599.17
5,797,787.64
Accruals and deferred income
1,425,069.50
1,386,083.38
Distribution funds to rightholders
46,928,551.40
45,992,628.67
Total debts
54,717,236.18
53,427,935.91
TOTAL LIABILITIES
59,355,029.43
55,447,884.83
36
notes to the financial statements
1. accounting principles
Entering performing right and mechanical reproduction royalty revenue as income
e Teosto income statement includes copyright royalties collected by Teosto from music
user customers and copyright royalties paid to Teosto by other organisations.
e royalties collected by Teosto are mainly performing right royalties. Teosto has
transferred the administration of mechanical reproduction rights to the Nordisk Copyright
Bureau (NCB), a joint Nordic agency.
e Teosto income statement includes mechanical reproduction right royalties paid to
Finnish rightholders by the NCB through Teosto on the one hand and collected by Teosto
from music user customers on behalf of the NCB on the other. e main principle is that the
income statement shows all cash flow from copyright royalties through Teosto, whether
collected by Teosto from music user customers or paid to Teosto by another organisation.
Valuation and depreciation of capital assets
Capital assets are stated at cost. Depreciation on buildings, machinery and equipment is
calculated using the declining balance method, while depreciation on capitalised long-term
expenditure is calculated on a straight-line basis. e following long-term depreciation
periods have been applied:
Computer soware
5 years
Other capitalised long-term assets
10 years
Buildings
4%
Machinery and equipment
25%
Valuation of investment assets
Securities and other investment assets are valued at cost or market value on the balance
sheet date, whichever is lower.
Consolidated financial statements
Consolidated financial statements have not been prepared because the operations of
Kiinteistö Oy Lauasalmi, Teosto’s subsidiary, had no material effect on the group’s financial
performance or financial position.
Kiinteistö Oy Lauasalmi is a mutual real estate company that covers its annual
maintenance and financing costs through maintenance charges paid by Teosto.
e real estate company is thus not intended to make either a profit or a loss. e equity of
the real estate company is EUR 503,474.86.
37
finacial statement
income statement by activity
Teosto issues licenses for the performance of music, collects performing right royalties from
users of music, and distributes royalties to right holders. By mandate of the Finnish Ministry
of Education and Culture, Teosto also collects the compensation for private copying on behalf
of entitled rightholders. Costs associated with each specific function are allocated internally
according to function. When calculating the proportion of general costs to be allocated to
each sector, actual expenditure has been observed as closely as possible.
ROYALTIES COLLECTED BY TEOSTO
2011
2010
Operating income
45,304,812.30
42,808,634.17
Operating costs
-7,329,094.92
-7,126,578.47
Fundraising
78,791.87
54,454.47
Investments and financing
1,185,978.93
1,364,308.18
Other income
120,000.00
120,000.00
39,360,488.18
37,220,818.35
86.9,%
86.9,%
Net income to rightholders
Percentage of operating income
Promotion of Finnish music (national funds)
Used to promote Finnish music
1,325,471.64
1,044,552.01
Transfer to the Teosto Fund
1,308,089.38
1,442,056.46
Total
2,633,561.02
2,486,608.47
6.7,%
6.7,%
36,726,927.16
34,734,209.88
8,018,496.18
8,371,555.04
Percentage of distribution of performing
right royalty income in Finland
Transfer for distribution to rightholders
ROYALTIES RECEIVED FROM OTHERS
Royalties from other organisations
Remuneration for public lending
Distribution costs
Siirto jae)avaksi oikeudenomistajille
306,714.57
668,812.28
-153,600.90
-186,880.80
8,171,609.85
8,853,486.52
Compensation for private copying
Operating income
6,522,901.91
6,487,112.90
Operating costs
-712,715.18
-729,886.76
Investments and financing
168,142.26
343,264.35
5,978,328.99
6,100,490.49
50,876,866.00
49,688,186.89
Transfer for distribution to rightholders
Total transfer for distribution to rightholders
38
2. notes to the income statement
ROYALTIES COLLECTED BY TEOSTO
Performing rights
2011
2010
Radio and television
26,237,208.57
24,190,933.39
Background music in customer premises
7,367,660.72
7,233,879.86
Concerts and other events
6,421,840.48
6,192,414.52
1,320,926.35
1,280,697.98
Internet and new media
Films and stage
931,934.07
888,738.53
Local authorities and parishes
889,087.96
866,001.27
Sport and exercise
768,545.81
742,919.01
Transport vehicles
592,095.07
576,187.90
Others
345,283.46
343,804.91
44,874,582.49
42,315,577.37
409,593.06
477,058.40
20,636.75
15,998.40
430,229.81
493,056.80
45,304,812.30
42,808,634.17
Mechanical reproduction rights
Radio and television
Internet and new media
Total royalties collected by Teosto
ROYALTIES FROM OTHER ORGANISATIONS
Performing rights
Sweden
501,875.55
418,767.45
409,052.07
341,672.09
UK
324,293.15
363,000.85
France
186,287.62
218,564.40
USA
171,074.46
169,462.62
Denmark
144,180.70
156,554.05
Germany
Norway
137,910.41
137,015.70
Netherlands
129,383.35
94,669.90
Spain
92,430.83
130,509.22
Italy
87,050.03
64,880.19
665,015.76
640,327.09
2,848,553.93
2,735,423.56
628,595.26
523,591.29
3,477,149.19
3,259,014.85
4,417,575.86
5,009,042.52
Others
Income from foreign performances of Finnish music
Others
Total performing rights
MECHANICAL REPRODUCTION RIGHTS
Income from mechanical reproduction of Finnish music (NCB)
Others
Total royalties from other organisations
123,771.17
103,497.67
4,541,347.03
5,112,540.19
8,018,496.22
8,371,555.04
306,714.57
668,812.28
REMUNERATION FOR PUBLIC LENDING
Compensation paid by the Finnish central government to
authors for the lending of works from public libraries
maintained by local authorities.
In 2010, remuneration was exceptionally paid for two years.
39
finacial statement
COMPENSATION FOR PRIVATE COPYING
A copyright fee incorporated in the retail price of devices used
for private copying.
2011
2010
6,522,901.91
6,487,112.90
OTHER INCOME
Services to FIMIC
120,000.00
120,000.00
120,000.00
120,000.00
89,698.12
105,180.41
DEPRECIATION
Other capitalised long-term assets
Buildings
7,693.04
8,013.58
156,282.13
171,094.82
253,673.29
284,288.81
Auditing fees
17,283.94
16,290.00
Counselling on taxes
8,208.47
9,342.50
145.33
2,502.00
25,637.74
28,134.50
358,049.98
261,339.79
15,906.05
15,766.58
Machinery and equipment
AUDITORS’ FEES
Other services
INVESTMENTS AND FINANCING
Income
Interest
Dividends
Rents
Sales profit
Restoration of value decrease
54,866.92
84,661.47
2,966,883.68
1,503,378.60
1,908.93
94,493.06
3,397,615.56
1,959,639.50
Charges
-26,776.80
-29,618.74
Sales loss
-247,530.02
-135,415.88
Impairment
-410,334.17
-28,250.42
Other costs
-49,098.43
-58,781.93
-733,739.42
-252,066.97
2,663,876.14
1,707,572.53
36,360,199.94
34,314,311.68
366,727.18
419,898.20
Performing right royalties from other organisations
3,372,785.43
3,154,539.93
Mechanical reproduction right royalties from other
organisations
4,522,781.35
5,097,015.54
276,043.11
601,931.05
5,978,328.99
6,100,490.49
50,876,866.00
49,688,186.89
968,310.70
1,432,272.41
-48,415.53
-71,613.62
919,895.17
1,360,658.79
Costs
Total for investments and financing
TRANSFER FOR DISTRIBUTION TO SHAREHOLDERS
Performing right royalties collected by Teosto
Mechanical reproduction right royalties collected by Teosto
Remuneration for public lending
Compensation for private copying to the Ministry of
Education and Culture
Ministry of Education and Culture decision on the distribution of
the compensation for private copying from the previous year to
Teosto rightholders.
Distribution costs
Distribution to rightholders
40
3. notes to the balance sheet, assets
CHANGES IN INTANGIBLE AND TANGIBLE ASSETS
2011
2010
Other capitalised long-term assets
Acquisition cost at 1 Jan
603,846.66
732,015.37
Accumulated depreciation
-334,769.66
-421,413.34
Balance at 1 Jan
269,077.00
310,602.03
25,285.00
63,655.38
Increases during the financial year
Depreciation for the financial year
-89,698.12
-105,180.41
204,663.88
269,077.00
192,325.96
200,339.54
-7,693.04
-8,013.58
184,632.92
192,325.96
Balance at 1 Jan
546,529.54
505,306.15
Increases during the financial year
121,485.09
227,318.21
Book value at 31 Dec
Buildings and constructions
Balance at 1 Jan
Depreciation for the financial year
Book value at 31 Dec
Machinery and equipment
Reductions during the financial year
-9,641.00
-15,000.00
Depreciation for the financial year
-156,282.13
-171,094.82
Book value at 31 Dec
502,091.50
546,529.54
21,776.98
21,776.98
13,061,203.58
13,877,236.65
12,587,415.79
11,899,191.30
Difference
473,787.79
1,978,045.35
Other shares and similar rights of ownership
415,691.84
833,244.92
Total shares and similar rights of ownership
13,024,884.61
12,754,213.20
6,827,742.73
5,939,076.85
SHARES AND SIMILAR RIGHTS OF OWNERSHIP
Shares in group companies
Publicly traded shares and similar rights of ownership
Total market value
Equivalent book value
TRADE RECEIVABLES
Royalties collected by Teosto
Compensation for private copying
797,980.53
629,513.73
7,625,723.26
6,568,590.58
e royalties collected by Teosto include EUR 1.2 million in uncertain receivables related to the dispute over
the tariff reform. is has been taken into account in the distribution to rightholders.
LOAN RECEIVABLES
Long-term receivables from group companies
Others
30,000.00
30,000.00
8,918.27
18,467.19
38,918.27
48,467.19
Performing right royalties
235,761.64
376,246.23
Others
422,185.31
505,822.13
657,946.95
882,068.36
PREPAYMENTS AND ACCRUED INCOME
41
finacial statement
4. notes to the balance sheet, liabilities
CHANGES TO THE CAPITAL OF THE SELF-FINANCED RESERVE
2011
2010
Capital of the Teosto Fund at 1 Jan
2,019,948.92
0.00
Increases to capital
2,617,844.33
2,019,948.92
Capital of the Teosto Fund at 31 Dec
4,637,793.25
2,019,948.92
OTHER DEBTS
Foreign copyright organisations
2,724,109.82
2,520,134.61
Finnish rightholders
1,276,931.96
1,234,996.82
Withholding tax
1,297,192.06
1,457,832.61
VAT
678,648.95
406,532.74
116,716.38
178,290.86
6,093,599.17
5,797,787.64
Others
ACCRUALS AND DEFERRED INCOME
Holiday pay
721,140.43
714,478.16
Promotion of Finnish music
195,000.00
195,000.00
Others
508,929.07
476,605.22
1,425,069.50
1,386,083.38
38,224,871.50
36,755,738.73
471,932.67
507,871.22
DISTRIBUTION FUNDS TO RIGHTHOLDERS
Performing right royalties
Mechanical reproduction royalties
Remuneration for public lending
Compensation for private copying
0.00
297,191.05
8,231,747.24
8,431,827.67
46,928,551.41
45,992,628.67
5. securities and contingent liabilities
LEASING LIABILITIES
2011
2010
Payments outstanding in connection with leasing agreements
Payments to be made in the next financial period
To be paid later
31,972.26
57,177.14
3,519.14
36,042.15
35,491.40
93,219.29
0.00
117,203.78
35,491.40
210,423.07
COMMITMENTS TO INVEST IN EQUITY FUNDS
Commitment unpaid
Total security and contingent liabilities
42
6. notes on personnel
AVERAGE NUMBER OF PERSONNEL
Music licensing and distribution
Compensation for private copying
2011
2010
81
85
5
5
86
90
4,389,766.00
4,361,625.79
PERSONNEL COSTS
Salaries
Fees
175,603.05
201,335.11
Pension costs
831,213.25
866,386.00
Other personnel costs
247,456.49
238,346.57
5,644,038.79
5,667,693.47
105,740.00
100,163.00
BOARD OF DIRECTORS
Fees paid to Board members
e retirement age of the CEO, deputy CEO and their deputies has been agreed at 60 years.
7. ownership in other companies
Name
Kiinteistö Oy Lauasalmi
Domicile Ownership
Helsinki
100 %
Equity
Profit/loss
503,474.86
-12,526.31
43
finacial statement
proposal for distribution to rightholders
e Board of Directors proposes that the amount of EUR 53,291,514.65 be distributed for 2011.
THE DISTRIBUTION SUM IS MADE UP AS FOLLOWS
Performing right royalties collected by Teosto
Mechanical reproduction right royalties collected by Teosto
2011
2010
36,360,199.94
34,314,311.68
366,727.18
419,898.20
Performing right royalties from other organisations
3,372,785.43
3,154,539.93
Mechanical reproduction right royalties from other
organisations
4,522,781.35
5,097,015.54
276,043.11
601,931.05
5,978,328.99
6,100,490.49
50,876,866.00
49,688,186.89
1,494,753.48
1,379,912.39
919,895.17
1,360,658.79
2,414,648.65
2,740,571.18
53,291,514.65
52,428,758.07
Remuneration for public lending
Compensation for private lending
(Ministry of Education & Culture)
Distribution reserves from previous years
Compensation for private copying from the previous
year to Teosto’s rightholders
Total distribution to rightholders
signatures to the annual report and financial statements
Helsinki, 14 March 2012
Kim Kuusi
Chairman of the Board of Directors
Katri Sipilä
CEO
Heikki Elo
Tom Frisk
Mikko Heiniö
Ari Nieminen
Timo Tyrväinen
An auditor’s report has been submied on the audit conducted on this date.
Helsinki
KPMG Oy Ab
Heidi Vierros
Authorised Public Accountant
44
auditor’s report
TO THE MEMBERS OF THE FINNISH COMPOSERS’ COPYRIGHT SOCIETY TEOSTO
We have audited the accounting records, the financial statements, the report of the Board
of Directors, and the administration of Finnish Composers’ Copyright Society Teosto for
the year ended 31 December, 2011. e financial statements comprise the balance sheet, the
income statement and notes to the financial statements.
RESPONSIBILITY OF THE BOARD OF DIRECTORS
e Board of Directors is responsible for the preparation of financial statements and report
of the Board of Directors that give a true and fair view in accordance with the laws and regulations governing the preparation of the financial statements and the report of the Board of
Directors in Finland. e Board of Directors is responsible for the appropriate arrangement
of the control of the company’s accounts and finances, and shall see to it that the accounts
of the association are in compliance with the law and that its financial affairs have been arranged in a reliable manner.
AUDITOR’S RESPONSIBILITY
Our responsibility is to express an opinion on the financial statements and on the report of
the Board of Directors based on our audit. e Auditing Act requires that we comply with the
requirements of professional ethics. We conducted our audit in accordance with good auditing practice in Finland. Good auditing practice requires that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements and the report of the
Board of Directors are free from material misstatement, and whether the members of the
Board of Directors and the Managing Director are guilty of an act or negligence which may
result in liability in damages towards the association or have violated the Associations Act or
the articles of association of the association.
An audit involves performing procedures to obtain audit evidence about the amounts and
disclosures in the financial statements and the report of the Board of Directors. e procedures selected depend on the auditor’s judgment, including the assessment of the risks of
material misstatement, whether due to fraud or error. In making those risk assessments, the
auditor considers internal control relevant to the entity’s preparation of financial statements
and report of the Board of Directors that give a true and fair view in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing
an opinion on the effectiveness of the association’s internal control. An audit also includes
evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of
the financial statements and the report of the Board of Directors.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide
a basis for our audit opinion.
OPINION
In our opinion, the financial statements and the report of the Board of Directors give a true
and fair view of the financial performance and financial position of the association in accordance with the laws and regulations governing the preparation of the financial statements and the report of the Board of Directors in Finland. e information in the report of
the Board of Directors is consistent with the information in the financial statements.
Helsinki 16 March 2012
KPMG OY AB
Heidi Vierros
Authorized Public Accountant
45
teosto
“Every work has
a long history behind it.”
Kaija Saariaho in a ‘Composer’s Chair
interview at Carnegie Hall.
kaija saariaho is one of Finland’s best-known contemporary composers.
She has always been uncompromising with her artistic choices. She
has recently been prominently featured in New York, where she was
Composer-in-Residence at Carnegie Hall in the 2011–2012 season. Her
work D’om le vrai sens was one of the Teosto Prize nominees in 2011.
46
HEIKKI SAUKKKOMAA / LEHTIKUVA
47
Finnish Composers’ Copyright Society Teosto
Lauasaarentie 1, FI-00200 Helsinki
Tel. +358 9 681 011 i fax +358 9 677 134
teosto@teosto.fi i www.teosto.fi