CISAC Reports: AI-Generated Content Poses a Threat to Music Creators

by  EVENTFAQS Bureau Industry Watch | December 4, 2024 | News

Confederation of Societies of Authors and Composers

The first global study on the economic impact of Artificial Intelligence (AI) on the music and audiovisual (AV) sectors has revealed a stark reality: while generative AI will significantly enrich technology companies, it poses a substantial threat to the livelihoods of human creators over the next five years. Commissioned by the International Confederation of Societies of Authors and Composers (CISAC), which represents over 5 million creators, and conducted by PMP Strategy, the study underscores the disruptive potential of generative AI in creative industries.      

According to the report, music and audiovisual creators risk losing a large portion of their income due to the substitutional nature of AI-generated content. By 2028, music creators could see 24% of their revenues vanish, while audiovisual creators may lose 21%, amounting to a combined cumulative loss of €22 billion (€10 billion in music and €12 billion in audiovisual). This erosion of income comes despite the fact that creators provide the creative foundation for the rapidly growing “Gen AI” content market. 

The study projects exponential growth in the AI-generated music and audiovisual content market over the next five years, from €3 billion today to a staggering €64 billion by 2028. Generative AI providers’ revenues are expected to rise correspondingly, with annual earnings in music soaring from €0.1 billion in 2023 to €4 billion in 2028, and audiovisual revenues climbing from €0.2 billion to €5 billion during the same period. However, these revenues largely stem from the unlicensed use of creators’ works, reflecting a significant transfer of economic value from human creators to AI companies.

In the music sector, AI’s impact will be particularly profound on streaming platforms and music libraries. By 2028, generative AI content is anticipated to constitute 20% of revenues on traditional music streaming platforms and 60% of music library revenues. Similarly, the audiovisual sector is expected to witness significant disruption. Translators and adaptors involved in dubbing and subtitling will face the greatest challenge, with 56% of their revenue at risk, while screenwriters and directors could see revenue losses ranging from 15% to 20%.

This study marks the first comprehensive attempt to estimate the global economic impact of generative AI on music and audiovisual creators. By combining qualitative and quantitative research, it uses real-world case studies of AI applications to identify areas of maximum disruption and translate these into economic estimates. The research incorporates historical data, market benchmarks, and insights from interviews with industry stakeholders, including Collective Management Organizations (CMOs), creators, tech companies, producers, publishers, digital service providers (DSPs), and institutional players.

Beyond analyzing potential revenue losses, the study offers a basis for designing remuneration schemes for creators, leveraging estimates of generative AI tools’ revenues. The findings highlight the urgent need for regulatory frameworks to ensure creators are fairly compensated as AI continues to reshape the creative economy.

The study concludes: “In an unchanged regulatory framework, creators will actually suffer losses on two fronts: the loss of revenues due to the unauthorised use of their works by Gen AI models without remuneration; and replacement of their traditional revenue streams due to the substitution effect of AI-generated outputs, competing against human-made works.”

Rakesh Nigam, CEO, Indian Performing Rights Society said, “The CISAC report sheds critical light on the far-reaching economic impact of generative AI on creators, particularly in the music and audiovisual sectors. While AI offers immense possibilities for innovation, it also poses significant challenges to the livelihoods of songwriters, composers, and other creators who form the bedrock of the creative economy. At IPRS, we firmly believe that robust policies are essential to ensure fair compensation and safeguard the value of human creativity, which fuels the very foundation of AI-driven content. This study is a timely wake-up call for policymakers and industry stakeholders to address these challenges collaboratively and equitably."

Björn Ulvaeus, President, CISAC said, “For creators of all kinds, from songwriters to film directors, screenwriters to film composers, AI has the power to unlock new and exciting opportunities – but we have to accept that, if badly regulated, generative AI also has the power to cause great damage to human creators, to their careers and livelihoods. Which of these two scenarios will be the outcome? This will be determined in large part by the choices made policy makers, in legislative reviews that are going on across the world right now. It’s critical that we get these regulations right, protect creators’ rights and help develop an AI environment that safeguards human creativity and culture.”