One year ago, on this very page, we had already reported that 2022 was a record year for SUISA. And now, the year 2023 has broken that record. Consolidated revenues from the management of authors’ rights – our core business – in Switzerland and abroad grew 9.8% compared with the prior year, reaching CHF 198.1 million for the SUISA group as a whole. As a result, the distributable amount also increased, by a satisfactory 9.8%, to CHF 176 million.
For the first time in its history, SUISA’s consolidated operating income over- stepped the CHF 200 million mark, reaching CHF 206.6 million.
Growing revenues from concerts and parties
Barely two years after the end of the pandemic, licensing revenues from performance rights – both for concerts and parties – rose sharply again in 2023. This was also the case for background music in shops, restaurants, and bars.
Revenues from the online dissemination of music in Switzerland and abroad were up last year to a satisfactory CHF 47.3 million (13.2%). This includes revenues from video-on-demand offers in Switzerland, as well as the revenues of SUISA’s subsidiary SUISA Digital Licensing. SUISA thus managed to make up for the dwindling revenues from sound recording sales and broadcasting rights which have been declining steadily year after year.
While in the past broadcasting revenues largely profited from the growth in commercials, advertising is now shifting increasingly online where target groups are easier to reach.
This, alongside even better market coverage, will be our next challenge in safeguarding the rights of our members and beneficiaries in the face of shifting usage.
Artificial Intelligence: fair renumeration for authors
Music produced by generative AI (artificial intelligence) is posing new and growing challenges. On the one hand, it competes with the repertoire represented by SUISA; on the other, as part of their data mining, the providers of AI software use existing works protected by copyright to train their algorithms – so far without remunerating the authors of such works. This is why, in March 2024, SUISA announced that AI providers may not avail themselves of the rights of use in the SUISA repertoire for such training purposes.
It remains to be seen how the debate relating to public service broadcasting, funded primarily by the State, will develop. The popular initiative “200 francs is enough!” seeks to obtain a reduction in household television and radio fees. The Federal Council has decided to stagger the reduction of TV and radio reception fees to CHF 300 per household by 2029. In addition, smaller businesses with sales of less than CHF 1.2 million are to be exempt from paying the fee. For its part, SUISA is contrary to any weakening of the media Service Public.
Investments lead to higher costs
The costs incurred to reach the gratifying year-end result also increased. As related to consolidated group turnover, costs attained 19.7% (prior year 17.8%). In this context, the higher IT investments in further process automation and the associated depreciation were particularly noteworthy. Moreover, following the necessary cost-saving period in the aftermath of the pandemic, more expenditure is now required to secure the quality of our services. We believe it makes more sense to spend CHF 7.4 million more this year than in 2022 if it ultimately means having CHF 15.7 million more to distribute to authors and publishers this year. It is certainly legitimate to seek ways to minimise the ratio of costs to revenue. But the lower the ratio, the lower the distributable amount is likely to be: market tracking, precise accounting and accurate royalty settlements are not free of charge, and ongoing investment is needed if we are to keep pace with market changes and technological development.
The average cost-coverage deduction on settlements was 12.85% (prior year 12.97%). Considering the supplemental distribution of 1.75% on all settlements to members and sister societies, it still amounts to 11.60% (prior year 11.85%) of distributed funds.
“Future Sounds”: looking ahead the next 100 years
The co-operative society SUISA celebrated its 100th anniversary in the reporting year. A multitude of successful events were organised to celebrate the centenary: from the anniversary General Meeting with the following party and concert, to our amusing film series “Louis gets it!” about music licensing and the jubilee stamp issued by the Swiss Post Office. Some of that may continue to resonate for a good while, but the “Future Sounds” project is guaranteed to do so: a competition in which composers of today write music for SUISA’s bicentenary in the year 2123, in other words, a musical greeting from the present to a future, as-yet-unborn audience 100 years hence.
