Fan-Powered Royalties (FPR) for Musicians in the Digitized Music Platforms: A New Alternative to the Pro-Rata System?

This article argues that in order to implement the concept of fair and equitable remuneration, Indonesian government should abolish the ‘best practices’ provision in article 80(5) of the copyright law and implement Indonesia’s national concept of ‘gotong royong’ which means ‘togetherness’, by facilitating musicians to conduct their licensing agreement with the collective management organization or in Indonesian known as Lembaga Manajemen Kolektif Nasional (hereinafter LMKN).

This article offers five recommendations to the policymakers to improve the Indonesian music law proposal as follows: (1) Indonesian parliament should establish ‘streaming remuneration’ to musicians paid by on-demand music platforms directly through the LMKN. This new concept will not disrupt the current licensing practices which already existed in article 80 of the copyright law. (2) In order to facilitate transparency obligation, Indonesian government is strongly encouraged to implement a data-driven approach by investing in a single music right database. (3) To improve musicians' bargaining power, Indonesian parliament should consider the factors that influence the success of the negotiation process in determining remuneration level. (4) The modernization of LMKN by creating a more conducive environment to facilitate the concept of transparency and (5) further study regarding the new ‘Fan-Powered Royalties’ as an alternative to the traditional remuneration scheme.