Chinese Online Class - Another monopoly in the making?

Opinion / Raymond Zhou

Another monopoly in the making?
By Raymond Zhou (China Daily)
Updated: 2006-07-25 11:39

For those of you who frequent the nation's karaoke bars and lounges, what
you sing will soon come under the centralized supervision of one really
Big Brother.

Called "The National Karaoke Content Management Service System," it has
been approved by the Ministry of Culture and will start a pilot programme
in three cities before it rolls out nationwide, according to the
Chinese-language press.

The announcement of the news, attended by some Ministry officials, was
made by the Culture Market Development Centre, an organization under the
Ministry. So far, the Ministry itself has refused press requests for
confirmation or elaboration.

But the nation's business media has smelt a rat, so to speak.

"The Centre is a 'guanshang,' a business run by a government agency, and
it does not conceal its ambition to monopolize the karaoke market," says
a commentary in Chinese Business View. "Even though it touts the
principle of 'free choice to plug into the system,' we have reason to
worry that, with an entertainment platform built on monopoly, anything
can happen."

The author of the article compares this system to China Union Pay, an
electronic inter-bank system that started by offering "free lunch" and
then graduated to a growing mountain of service fees, causing a major
public outcry.

The "KTV tunes database," as the karaoke system is known in layman's
term, claims to have one major advantage in stamping out unauthorized use
of copyrighted music: Every time a song is requested for singing-along,
it will have an automatic record, and therefore, collect a royalty fee
for the music label that owns its copyright.

In the past few years, music labels have occasionally targeted karaoke
businesses for copyright infringement lawsuits. It is reported that no
karaoke business in China pays royalties for every tune used. There is
simply no such mechanism even if it wanted to.

The music labels have "expressed support for such a system," said a
spokesman for the company that is building the system. But in recent
interviews, some labels admitted that they did not really know how it
would work out.

One more question: If participation is optional for a karaoke operator,
why would he opt in and pay while his competitors can continue the free
ride? Wouldn't that create an unfair environment for competition?

To my knowledge, this system by no means fills a void. There is an
organization under the Music Association that is supposed to collect such
fees. The dilemma is, it is incapable of enforcing the rules even when it
wants to.

The most effective thing a centralized "KTV tunes database" can do is to
filter out unwanted songs, as it states explicitly to be its top
priority. But therein lies the biggest trap.

The database will forbid "unhealthy" songs from karaoke use. But who will
define what is "unhealthy"? Some folk songs are quite racy by our
standards, but they are part of the traditional dating rituals of some
ethnic minorities.

And tastes change over time. Many of the love songs that we take for
granted today would have offended millions had they appeared a decade ago.

Suppose the system errs on the side of precaution and goes for the
"lowest common denominator." That would keep many of the unconventional
tunes out of the door, especially rock, hip-hop and those created in Hong
Kong and Taiwan.

It is no secret that many of the hot new melodies come from outside the
mainland, where the pop music scene has a freer rein. The sensitivity
displayed in those songs would no doubt offend some censors, who tend to
have conservative tastes.

On top of it, there is the time lapse in okaying imported music in time
for karaoke consumption. As most albums are released simultaneously all
over Asia, a consumer who prefers "hot" tunes may not be able to find
them in the "KTV database" as they bide their time in the pipeline of
approval from censors, a scenario common with film imports.

If that happens, the karaoke business will be sapped of its vitality as
it takes on an antiseptic feel. Songs pushed by the system may be those
grandiloquent arias, while those giving voice to private feelings such as
angst and frustration may be snubbed.

In the worst case, the grass-roots sing-along business may wither.

Email: raymondzhou@chinadaily.com.cn

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