Tracing transformation by tension: A multidisciplinary perspective on German performing rights organizations navigating conflict and technological changes

Abstract

This paper examines the evolving role of German Performing Rights Organizations (PROs) in the context of technological advancements and societal shifts, focusing on the tensions and transformations. Employing an interdisciplinary approach encompassing history, sociology, and computer science, the study analyzes three case studies spanning from the early 20th century to the present day. These cases explore tensions arising from monitoring practices in the 1930s, conflicts between the German PRO GEMA and actors of the underground electronic dance music scene, and the challenges posed by artificial intelligence (AI) to collective copyright management. The analysis highlights how PROs must adapt their core tasks – licensing, revenue collection, royalty distribution, and usage monitoring – to address technological disruptions and maintain cultural diversity. The paper concludes by advocating for increased transparency, technological openness, and interdisciplinary research to guide the future development of PRO business models in a rapidly changing media landscape.

Performing rights organization's: copyright organizations between conflict and compromise

In the creative and media industries, the licensing, securing, and clearing of copyright-based works are becoming increasingly important. The relationships within this “media-industrial complex” are largely negotiated by Performing Rights Organizations (PROs). These entities act as intermediaries between authors and users of copyrighted works by establishing licensing guidelines and determining financial compensation through monitoring usage. The European Union describes the core tasks of a PRO as negotiating license fees and authorizing exploitation, collecting revenues, distributing royalties, and monitoring content usage (EU, 2009). PROs tend to define their own responsibilities more broadly. In addition to the financial exploitation of copyrights, CISAC, the international umbrella organization of collecting societies, also sees the general representation of interests and the non-material protection of creative work in general as the task of PROs (Ficsor, 2022: 19). This idealistic claim, enshrined in Article 8 of the CISAC statutes, requires PROs to have a certain degree of contentiousness on behalf of their members. Therefore, they are defined and shaped by conflicts, seemingly fought for the interest of the creators in diverse fields such as music, art, and literature. Fittingly, PROs only seem to enter the broader public discourse when a dispute—i.e. tension—passes the threshold of newsworthiness in the media.

Despite their significance, PROs have only recently gained scholarly attention outside legal studies. ¹ In 2023, the authors of this paper edited an anthology combining research from sociology, musicology, law, information science, economics, and history (Fischer et al., 2023). This interdisciplinary approach highlighted that understanding PROs requires diverse methods. Research on PROs is very much characterized by legal approaches tend to distinguish between true/legal and false/illegal positions. Furthermore, legal studies on PROs are often used to improve and streamline the legal work within PROs. In contrast, we recommend understanding PROs as historically evolved organizations in which esthetic, financial, technical, and legal issues are balanced. To illustrate this, we use various historical stages to explain adaptations of PROs due to organizational, cultural, and technical developments. As a result, many systems of rules can be observed in PROs, which were negotiated as compromises between the actors involved. Studies show that PRO development is often sparked by tension and conflict, with numerous historical examples. Even the founding myth of the PROs, the so-called “sugar water trial” of 1847, falls into this category. Back then, the French composer Victor Parizot and the writer Ernest Bourget refused to pay their bill at the restaurant Les Ambassadeurs in Paris, where their works had been performed without their permission and remuneration. The resulting legal dispute laid the foundations of the first modern PRO, the SACEM (Ficsor, 2022: 18–19; Fischer et al., 2023: 9). ²

The dual role of PROs as business organizations and interest groups places them at the center of conflicts between authors and (music) users. These conflicts can arise from various factors and impact the complex structure of copyright exploitation. As representatives of authors’ interests, PROs often find themselves in proxy conflicts with users, sparked by organizational practices and resulting in media backlash (Fischer et al., 2023: 14–19). Additionally, their size and economic position can lead to power imbalances, with organizational growth sometimes diverging from authors’ collective interests, especially in the face of technological advancements.

PROs also influence legal development by representing political interests and enforcing laws, leading to tensions with authors and users. Particularly PROs with diverse memberships must navigate conflicts arising from their intermediary role between authors and users while communicating their business model to all parties and society. ³

One example for technological-induced tension is the conflict between GEMA and YouTube over streaming remuneration, which was resolved in 2016 (Stade, 2021). ⁴ It illustrates how monetarily relevant uses of works depend on available technologies. The digital transformation has enabled new types of works and interactive uses, necessitating PROs continuously adaptation along all of their core tasks (EU, 2009): Negotiating licensing fees and granting exploitation rights, gathering and distributing royalties, and tracking content usage.

In this article, we will analyze various challenges that PROs face, both internally and externally, through three case studies. We adopt an interdisciplinary perspective at the intersection of history, sociology, and computer science. The case studies consist of two retrospective analyses, which, focusing on the past and present, provide the thematic foundation for the third case study, which develops a view into the future. Firstly, we will examine the socially induced tensions in early 1930s Germany, triggered by the work of PRO inspectors who monitored and controlled events, creating conflicts with music users. Secondly, we will explore cultural and technical friction between German club DJs and the biggest German PRO GEMA, highlighting how the lack of monitoring practices misrepresented underground music genres. Based on the findings of PROs dealing with these tensions, the third case study draws a picture of the technological frictions induced by the recent developments in artificial intelligence (AI).

Although the cases span over a century and encompass a wide socio-technological spectrum, they collectively illustrate contexts, which have induced tension. This case study covering multiple cases (Eisenhardt, 1989), a design, which facilitates a comparative analysis, thereby, enhancing the understanding of the evolving challenges and dynamics faced and their impacts on PROs.

The structure of all case studies is organized along the above-mentioned four core tasks for PROs. Although the case studies focus on musical copyrights in Germany, this structure is intended to facilitate the transfer of findings to other media or markets. Using the examples of music inspectors and club music monitoring, we will show how PROs’ knowledge acquisition and dissemination practices create tensions. Tensions can also arise within PRO members, who may form coalitions with music users. These considerations are critical as generative AI systems threaten PROs’ business models fundamentally. By incorporating sociological, historical, and technological aspects, particularly the development of new technologies such as AI, the case studies will explore the origins of pressures for change and highlight the potential for constructive transformations within PROs’ business models.

Disrupting spaces—Early inspections by PROs

Before 1933, three collecting societies operated in Germany: the “Genossenschaft Deutscher Tonsetzer” (German Composers’ Cooperative, or GDT, founded in 1903), the “Genossenschaft zur Verwertung musikalischer Aufführungsrechte” (Association for the exploitation of musical performing rights, or GEMA [old], founded in 1915), ⁵ and an agency of the Austrian AKM. ⁶ This complex situation temporarily ended in 1930 with the founding of the Verband zum Schutze musikalischer Aufführungsrechte für Deutschland (Association for the Protection of Musical Performing Rights for Germany, or Musikschutzverband). The Musikschutzverband created a joint collection organization (Dommann, 2014: 111), employing a total of 76 for GEMA [old], 19 for GDT, and 78 at its headquarter, with 17 general agencies established to enforce authors’ rights in the provinces. ⁷

The new organizational structure of the PRO had significant consequences, which can be illustrated alongside the core tasks of a modern PRO. Firstly, the centralization of licensing negotiations, unseen since 1915, potentially strengthened their bargaining position towards music users. Secondly, for the first time, the organization's reach extended across the entire German Reich, enabling the enforcement of exploitation rights throughout its territory. This expansion, in turn, correlated with a rise in collected royalties during a period of economic crisis, indicating—thirdly—a welcome increase of distributed royalties to its members. Fourthly, inspired by practices like those of SACEM in France (Dommann, 2014: 111), the PRO expanded “in person” usage monitoring through inspectors. This increased level of oversight, however, created tensions. Music users newly brought within the PRO's reach became de facto adversaries, understandably resistant to what they perceived as unjustified invoices for pre-existing practices. The introduction of the PRO's field service, therefore, represented a disruptive force within the established landscape of cultural practice.

Max Butting, head of Musikschutzverband's field service and later of its Nazi successor STAGMA until 1937, anticipated that local controls would not popularize copyright law due to the annoyance of music organizers. ⁸ Hence, the inspectors’ professionalism was crucial, as they were liable for the inspection forms’ accuracy and had to defend them in court. Butting developed a network of highly qualified inspectors. These inspectors had to be well-trained specialists with “expertise, conscientiousness, a sense of duty, and impeccable moral qualities.” ⁹ According to the PRO's work instructions, control officers, who had to be musically and repertoire-savvy, were required to attend performances inconspicuously and note all works performed, regardless of their protection status. Completed control sheets, along with any issued printed programs, were submitted to headquarters. Unfamiliar pieces required the inspector to either obtain information or omit the piece, necessitating a high level of repertoire knowledge and musical training, since the inspector was expected to write down the melody of unknown pieces by ear. ¹⁰ Inspectors were forbidden from influencing the program and instructed to avoid contact with music organizers to prevent insults or even violence. ¹¹

Music users, mainly innkeepers and publicans, often responded to fee demands with complaints about the tariff structure, perceived as arbitrary, and the non-transparent administration of the collecting society—basically criticizing all four of the core tasks of the PRO, regardless of whether they were affected by them directly or not. The uncompromising enforcement of fee demands in court exacerbated these grievances, portraying the PRO as an impenetrable bureaucratic apparatus exploiting a power imbalance, especially affecting rural innkeepers and publicans. Court proceedings sometimes led to financial difficulties for publicans. ¹²

Control staff actions, including attending musical events and recording performed works, were particularly criticized. The preparatory documents for the “Stagma Law” of 4 July 1933 ¹³ included a polemic entitled “Der Musikdenunziant” (The Music Denouncer), labeling inspectors as “music informers” and “music spies” who “snooped” on performances and did not identify themselves, thus being perceived as “unsympathetic." ¹⁴

The Nazi dictatorship addressed these conflicts with the “Stagma Law,” authorizing police support for the STAGMA control apparatus. The explanatory text claimed this would “result in a far-reaching restriction of the current control system, a source of constant annoyance and anxiety for music organizers." ¹⁵ However, controls intensified under Nazi rule, and complaints only subsided with Germany's economic recovery in the mid-1930s.

The analysis of Musikschutzverband's control apparatus highlights that tensions arose not from legal codification or technical innovation but from organizational changes in PRO practices within their historical context. Understanding PRO conflicts requires examining their interactions, communication, and self-presentation with customers. The example of 1930s inspectors illustrates the PRO as a social actor directly engaging with musical practice and sociopolitical formation of opinion, emphasizing the pressures for change without resorting to technology-deterministic thinking.

Disrupting practices—Monitoring Club music in Germany

The administrative practice of the controllers still exists today. The reinterpretation of “controllers” as “customer advisors" ¹⁶ does little to change the fact that criticism of the collecting societies’ control practices has remained a recurring phenomenon. This does not only concern conflicts between the PRO and music users. With the increasing change in musical practice, factions can also form within a PRO. ¹⁷ Indeed, these inherent tensions within the PRO structure, arising from the core function of balancing control with the diverse landscape of musical creation and consumption, can become amplified when faced with novel forms of musical expression.

To illustrate this, the second case study will examine how the above-mentioned four core tasks of a PRO interact and are potentially challenged by novel music performance practices. This case will focus specifically on the context of club music, where the lines between traditional performance, composition, and DJing can become blurred. The PRO's answer to this novel esthetic practice was called “club monitoring”—basically recording and tracking the music played in clubs through which GEMA tried to extrapolate appropriate royalty collection and distribution. This case shows exemplary how the change in cultural practice can induce tension through changing realities of contemporary music practices and how GEMA attempted to navigate these complexities.

In 2013, the collecting society GEMA launched a comprehensive tariff reform for discotheques and DJs. Many club operators, musicians, and associations criticized the reform due to the sometimes massive cost increases; at the same time, doubts grew as to whether the distributions from discotheque monitoring would be distributed fairly. The association of club operators, the Club Commission, complained, for example, that the monitoring was too opaque and structurally disadvantaged players from the club scene because a significant proportion of the tracks were not recognized. Together with the Live Music Commission (Livekomm) and the Association of Music Venues in Germany, GEMA then set up its own working group. It spent around a year examining the technical and statistical possibilities of discotheque monitoring. After analyzing the market, it concluded to switch from the previous provider Mediacontrol to the French company YACAST (MusikWoche, 2014).

The provider changed, but the statistical extrapolation method remained largely the same until today: Monitoring boxes—also known as “black boxes”—are connected to the club's music system and record all the music. Subsequently, a random hour is selected for each dance floor, within which the tracks are identified. For cost reasons, however, only 120 of the approximately 5500 dance floors in Germany are analyzed by monitoring. Around 6200 h of music per year are thus recorded. Based on the data collected, the company calculates how often works are performed and determines how royalties are distributed. According to GEMA, the average distribution is currently around 3 cents per minute of performance. To receive 500 euros in royalties, a work would have to be played for more than 16,500 min in total. According to GEMA, the high figure is due to the fact that income from discotheques is comparatively low (GEMA, n.d.).

In cooperation with the Institute for Economic and Social Statistics at the Technical University of Dortmund, it is randomly determined which discotheques take part in the monitoring. Large cities are given special consideration due to their diverse music repertoire and are provided with more boxes than rural areas. If a discotheque is selected, YACAST and GEMA asked whether they would like to install the monitoring box. To incentivize clubs and discotheques to participate in monitoring, GEMA offers them a flat-rate subsidy of around EUR 600 per year. However, it is obvious that many discotheques have general reservations about GEMA and want to have as little contact as possible. At that time, the clubs’ objections were due to the following points: The monitoring procedure is bureaucratic but brings relatively little money to the producers of the music played, also because the identification procedure often does not work well enough beyond the standard repertoire. In addition, GEMA was and still is often not accepted in the underground genres because the PRO is identified with the music industry, from which they want to distance themselves. ¹⁸

But there were also problems that affected the music itself. In many German discotheques, not only the “standard repertoire,” as GEMA calls it, is performed. YACAST can identify this with a rate up to 97 per cent. Beyond the standard repertoire, however, there is a significant proportion of music in niche underground genres such as hip-hop, house, dubstep, or techno that was and sometimes still today is not easily accessible to normal consumers. This music can often only be heard in clubs since. Many of the tracks played in clubs contained unlicensed third-party samples and are therefore strictly speaking illegal, including sampling-based tracks, own versions (‘edits’), remixes, or mashups. Such tracks are very popular with DJs and make up a significant proportion of club culture, but they are generally not available in the databases that YACAST uses for identification. In many cases, this music is only released in small editions on underground labels (“white labels”) or circulates within scene circles. Sampling-based music is therefore problematic in two respects: firstly, in terms of copyright, because the tracks do not normally reach the regular market due to the complicated clarification of copyright and neighboring rights; secondly, in terms of remuneration, because both the original authors and the authors of the sampling-based tracks cannot be reached for the distribution of the discotheque monitoring. The copyright problem becomes an exploitation problem.

As neighboring rights also play a role in sampling, this is where the PRO “Gesellschaft für die Verwertung von Leistungsschutzrechten” (GVL), the society for the exploitation of neighboring rights, comes into play. Unlike GEMA, GVL represents the performing artists and those involved in the production of sound carriers who are involved in the production of a musical work. Their rights to the performance and the actual recording exist independently of the copyright of the actual piece. GVL charges discotheques a flat fee for this, which amounts to around 26 per cent of the GEMA levies. However, GVL does not carry out discotheque monitoring like GEMA for cost reasons. The PRO pursues a different program: It does not monitor the discotheques. Instead, it reserves a share of the distributable funds for new releases and distributes this separately. Samples can be considered if GVL has the relevant information.

However, information about which samples have been used is extremely sensitive. Many music producers were reluctant to disclose their sample sources as they fear that they will have to buy expensive licenses for the tracks or even that their publication will be banned. Prior clarification of copyrights is often unsuccessful, as licenses can simply be refused, or license fees can be set as high as desired.

Despite all these legal barriers, sampling-based music exists in many different forms—it has just found other places and forms of publication. As the current monitoring system does not do justice to the practice of DJs and the music performance cannot be appropriately exploited DJs called for a system that takes account of musical practice—a system in which samples are recognized as such and the corresponding remuneration is automatically made available to the original authors. On the one hand, this would presuppose that sampling is possible without authorization—which seems rather hopeless in the current copyright situation (besides the Pastiche exemption introduced in 2021 (Kreutzer, 2023) but merely applying for amateur users). On the other hand, all music would have to be available in digitalized form and samples would therefore have to be separately identifiable, which is also likely to cause difficulties (Peiris, 2015).

GEMA's current distribution plan provides for the basic features of the monitoring procedure to be published. However, due to the risk of manipulation, monitoring is not kept completely transparent; it remains largely a “black box.” For discotheque operators, for example, it is not clear at what times the YACAST boxes are recording. Even the list of discotheques involved in the monitoring is kept under lock and key. This makes it almost impossible to get an overview of the music played in German discos and its distribution.

While music practice is constantly changing based on the available technologies and their cultural application large organizations such as the German PRO GEMA tend to have a high degree of formalization and a certain structural inertia. A few years ago, GEMA introduced a new fingerprinting procedure that also allows DJs and producers to upload their own tracks for better identification of the tracks and thus strengthen the database. ¹⁹ Despite this, no track-accurate billing system has been guaranteed to date, which GEMA justifies with excessive costs that it would have to pass on to its members. In addition, the underground DJs and producers within GEMA still do not form a large group in the membership structure, so that changes could also be driven forward more strongly from within. For an integrated analysis of GEMA as a PRO, the case described is nevertheless very instructive, as it shows how important technology and culture can function as drivers of PROs. It also became clear that the information about the music performance practice, i.e. where which track is played in which length and in which context, plays a key role in the remuneration.

Disrupting technology?—Challenges and chances for PROs in the AI revolution

As the previous case showed, the advent of digitalization has caused significant disruptions in the production and distribution processes of creative works. Concurrently, advancements in AI are introducing substantial technological potential for tension across all tasks of PROs. This case study highlights the AI-induced friction potential, focusing generative AI tools, which can significantly automate, replace, or alter creative processes, thereby challenging traditional workflows and redefining the roles of human creativity and innovation—a subject PROs were formed to monetize. As the issue presents a broad and complex landscape characterized by numerous influences of AI on PROs, the ensuing discussion is structured around the four core areas of PROs. This approach will facilitate a systematic exploration of the various dimensions.

Many issues discussed here remain unresolved from both legal and technological perspectives, necessitating the use of analogies to delineate potential courses of action—beside a more frequent use of the subjunctive. The impact of AI on the music business remains ambiguous, with discussions and arguments from PROs revealing more about discourse practices than providing clear solutions.

The negotiation of license fees is the first core task of collecting societies, on which the emergence of AI tools and services is exerting considerable pressure and posing substantial challenges to the traditional mechanisms of negotiation and value determination. AI tools and services favor an erosion of the relationship between music users and PROs, as easily accessible and powerful tools (Amankwah-Amoah et al., 2024) diluting the value of original works. Output is generated in large quantities and without human intervention, leading to inflationary tendencies and reducing uniqueness, artistic appreciation and may ultimately decrease the willingness to pay adequate financial compensation. This may lead to a deterioration of the negotiating position of PROs when determining license fees, as with an increased use of AI-generated content, licensors may have difficulties negotiating appropriate royalties. In addition, the licensors could lose market shares as licensees increasingly turn to royalty-free works to save costs. This could lead to a reduced market size, both in terms of the height of license fees and the number of licenses granted—a negative potential a study conducted by the CISAC quantified with an expected loss of 24% of music creators’ revenue by 2028 (Curt et al., 2024).

At the same time, AI models often have used copyright-protected works for training (EU, 2024; NIST, 2024). This opens a further area of tension, as creative works protected by copyright are an important prerequisite for powerful AI models, but licensing in this area tends to be the exception, ²⁰ so that the majority of authors have so far been excluded from the exploitation based on them. As a legally not yet uniformly and ultimately regulated topic, this is considered critically by interest groups (Dornis and Stober, 2024) or the members of PROs, with demands on the part of authors ranging from mandatory disclosure and an obligation to obtain consent to remuneration for the use of copyrighted material for the training of AI models (Goldhammer et al., 2024). On the other hand, there is the business perspective of companies providing AI tools or services. Taking advantage of the room for maneuver and uncertainty in the legal framework, the approaches follow on the one hand a fair use policy argumentation and fast implementation (Rajan, 2024), and on the other hand, this topic is also seen as open problem and relevant from a risk management perspective (see for example MIAC, 2024; NIST, 2024).

The past offers various examples of technology-induced pressure for change, such as sampling and remixing, new reproduction options or the remuneration of content distribution on platforms such as YouTube, which could be drawn on as analogies (Flick and Worrall, 2022). The pressure was followed by a sometimes lengthy reconciliation of interests between corporations and collecting societies, which have so far always been able to agree on acceptable remuneration models.

The range of solutions outlined in these examples extends from legal clarification to the establishment of institutions to handle new, cross-media remuneration models such as the ZPÜ in Germany. This is an institution founded jointly by various collecting societies which, as a central contact point, asserts the remuneration claims for private reproductions and then distributes these to the collecting societies. Such an organizational structure allows for more efficient enforcement of license payments with cross-media relevance (Kreile and Becker, 2003) and could also serve as an option for remuneration in the context of AI.

The range of challenges in the second core task of PROs, the collection of royalties, extends from the aforementioned reduction in revenue due to the replacement of original works by generated works to legally ambiguous licensing situations. This is due to the fact that the use of technology in the creative process is also a continuum. Numerous authors are already using AI tools today (Goldhammer et al., 2024). Depending on the creative process and tool used, there are different levels of originality. Generative AI can be involved as a supportive instrument but can also be used to create entire works just based on prompts. Other AI applications extract creative ideas and make the transformation process from a creative idea to realization much more efficient (Bellier et al., 2023). The determination and remuneration of the creative share in the creation of a work is therefore an unresolved but complex legal and social issue—in addition to the question of the remuneration of rights holders for the use of copyrighted works for the training of models.

The third core task of PROs is the distribution of royalties. As stated above, the use of AI tools significantly reduces the hurdles in the creative process. Therefore, irrespective of how the legal uncertainties are organized in detail, a further increase on the supply side can be expected. This leads to an increase in complexity in the qualitative (share structures) and quantitative (number of works) dimensions of royalty distribution.

Already with trends such as the increasingly international exploitation of copyrighted works, large latencies between the use of works and the payment of royalties were a problem for PROs (Klingner et al., 2021). Organizational and technological measures need to be taken to create the structural prerequisites on the part of the PROs to enable prompt payment of royalties. A stronger temporal and logical link between cause (“use of work”) and effect (“payment of royalties”) should have a positive effect on the attractiveness of PROs (Frederick et al., 2002).

The fourth core task of PROs is the monitoring of usages, which is essential for ensuring accurate royalty distribution and enforcement of rights. As the case studies above illustrate, a delayed or selective enforcement of long-standing royalty claims can lead to tensions. Therefore, it is crucial to enforce a legal claim comprehensively once it has been established. The prerequisite for this is reliable data through an effective monitoring of usages.

AI plays a twofold role in this context. On the one hand, the accessibility of generative AI tools and the effectiveness of their output on a quantitative and qualitative level make it difficult to recognize works and assess their eligibility for protection. On the other hand, AI can also serve as an enabler for precise usage monitoring, for example for setlist identification of live music performances (Yesiler et al., 2021), allowing for an effective and efficient distribution of royalties based on technology. Similarly, when appropriate licenses are embedded within the legal frameworks and distribution plans, the detection of AI usage in the creation of works can be facilitated through AI models. However, this scenario is likely to give rise to a cat-and-mouse game between generative models and detection models, as each side adapts to the advancements and strategies of the other.

This ambivalent role illustrates the need for an empowered approach to AI from the perspective of the PROs. It becomes clear that, despite the challenges posed by AI, there are also solutions for improving the protection of intellectual property and protecting the rights of authors. In the legal field, the ongoing process of balancing interests and opinions, akin to that observed with all disruptive developments, suggests that concrete national or international regulatory implementations may require significant time to materialize. Consequently, PROs are already engaged in a discourse-building process across various levels: through studies (Curt et al., 2024) and position papers (GEMA, 2024), as well as through legal actions (Goebel, 2024), all of which serve as critical steps toward achieving legal certainty. Such efforts may ultimately facilitate the development of new laws in the long term. In this context, PROs are actively fulfilling their role as advocates for authors’ interests, positioning themselves more adeptly as constructive and technology-positive actors compared to previous technological-induced tensions.

PROs and cultural diversity—a sideshow?

Beyond the core business, the preservation of cultural diversity is another task of PROs (Dietz, 2014). Primarily, this is achieved, albeit with varying degrees of success and emphasis (Rogers et al., 2022), through initiatives such as the provision of social or cultural funds. Secondarily, PROs can as well exert influence on cultural diversity due to their gatekeeping or controlling role in the distribution of cultural works (Street et al., 2018).

Generally, PROs can directly define the value of cultural goods through their distribution plans. Specifically, they might implement differentiated pricing strategies for various customer groups (Hviid et al., 2017) or genre-specific remuneration rates, such as the distinction between “U-Musik” (light music) and “E-Musik” (serious music) employed by the GEMA. ²¹ Both examples illustrate how the regulatory framework established by PROs can shape cultural consumption patterns and preferences, thereby influencing associated royalties and, consequently, cultural diversity.

The first two case studies of this paper seem to suggest, that the practices of PROs can be framed as threatening to cultural diversity particularly by endangering the economic survival of traditional spaces of musical practice, as observed with the case of the publicans in the 1930s mirrored by the fear of a “Clubsterben” post-2012.

This risk also manifests when PRO practices do not align with new esthetic practices, leading to conflicts with emerging cultural scenes, such as those in the club music industry, who may feel unrepresented and disconnected from the collective management of royalties.

The advent of AI introduces additional challenges to the preservation of cultural diversity. AI systems, through inadequacies in datasets (Zowghi and Da Rimini, 2023) and mainstream biases in recommendation systems (Zhu and Caverlee, 2022), can inadvertently reduce diversity, negatively impacting royalties for non-mainstream artists. Similar concerns were echoed by underground club music creators in the second case study of this paper. Moreover, the competitive landscape shaped by AI-generated, royalty-free works can pose significant challenges for young creatives, potentially stifling their market entry and long-term diversity.

To mitigate these issues, it is crucial to address biases in AI algorithms to ensure fair representation and compensation for all creators. PROs must rely on responsible algorithm and AI model designs by tech companies to achieve this goal.

Conclusion

The interaction between PROs and new stakeholders in the AI era is marked by a tense reconciliation of divergent interests, reflecting a broader social discourse on evolving legal and legislative terrains. This situation necessitates continuous adaptation from PROs in all four of their core tasks and updates to the legislative frameworks governing them. Historical parallels can be drawn with previous technological disruptions, such as digital downloads and reproduction, which similarly prompted a revision of legal frameworks and monitoring mechanisms to safeguard rights holders’ interests. This realignment is essential to maintain the integrity of the copyright ecosystem and to address the challenges posed by technological disruption.

As the first two case studies made clear, the analysis of these challenges should not be defined by a technical-deterministic view of copyright law's evolution. PROs, as social actors, have historically developed practices that influence cultural creation and practice, creating external tensions with stakeholders across the social spectrum, from restaurateurs to tech giants like Google. Internal tensions also arise within PROs, with members advocating for new esthetic practices and ideas. These practices and the resulting tensions should be critically examined by the PRO when reviewing their business model and further in discussions about copyright law adaptation.

One central tension highlighting many aspects of the current situation is the demand from AI developers for high-quality training data and the associated financial compensation questions. While some advocate for free data use, others enter into license agreements with specific content providers. As recent studies indicate a persistent high relevance of genuine creative works for the training of AI models (Alemohammad et al., 2023), authors increasingly expect appropriate royalties (Goldhammer et al., 2024), leading to protective measures (Longpre et al., 2024), or new business models (Weiß, 2024). This underscores the need for innovative technological solutions, updated legal frameworks, and robust monitoring mechanisms to ensure fair compensation, maintain the integrity of the copyright ecosystem, and address the challenges posed by technological advancements.

PROs therefore should further develop their business models in terms of increased transparency, seamlessness, and technological openness. Specifically, this might mean clear communication of distribution plans and tariff structures to customers and members, low-threshold processes to increase acceptance, and the use of technologies such as AI-based chatbots to simplify complex processes. In general, PROs should ensure transparency in all core tasks and might benefit from processes that require little initiative from customers and members. Flat rates for example are very effective in reducing monitoring efforts and the need for tension inducing controls. The resulting “black box” problem—the discrepancy between actual usage of copyrighted works and the royalty distribution by estimate—might in the future be minimized through improved data processing using AI. While the internal operations of PROs are nuanced and complex, making specific recommendations challenging, this research demonstrates how key guidelines reflecting a broader value system can be proposed. These guidelines further illustrate the value of interdisciplinary approaches within the humanities and social sciences in guiding the future development of PRO business models. In addition to the examination of purely legal approaches, which develop perspectives on the boundary between legal and illegal and are also incorporated into the work of PROs, we recommend examining the functionality of PROs as organizations and their evolution in greater detail. Our paper shows that, depending on the context, PROs can adapt as organizations and respond to external and internal pressures. The three case studies examined show the range of organizational, cultural, and technological factors involved. Such an interdisciplinary approach could be applied and refined in subsequent studies. This could focus on PROs with other specializations outside the music industry. It would also make sense to compare PROs internationally and work out national specifics and relate these to legal, cultural, technical, or organizational factors.

The challenges posed by AI are not merely technical; they are fundamentally social and require a nuanced understanding of the power dynamics and evolving needs of all stakeholders. PROs, therefore, must embrace a proactive approach, engaging in critical self-reflection regarding their own practices while advocating for a legislative framework that balances technological innovation with the fair compensation and representation of creators. This necessitates a re-forged connection between technological advancement, legal adaptation, and robust monitoring mechanisms, ensuring the continued integrity and vibrancy of the copyright ecosystem in the face of disruption.