Success

"The music industry invests in discovering new talent. As a local example, Virginia Records has supported the Bulgarian Music Idol show by giving the winner a chance at a professional career. This is a big risk and does take courage to do," Kileva says.

"It is not easy in a market as small as Bulgaria, where our producers are already happy if they sell 5000 records," she says.
One of the anti-piracy successes has been at the book market on Slaveikov Square, previously a place where the latest music, films, videos and computer games were sold openly. "You will not find any music there anymore," Kileva says.

"This has been made possible after changes to the Penal Code in 2006, with which the storage of pirated discs became a crime. Until then, often the sales could not be caught in the act and the storage was not illegal. We also have to acknowledge the work of police and prosecution in this," she says.

According to Kileva, repression alone was not the answer to the difficult situation in which the music market found itself at the moment. "Bulgarian music producers are extremely active in trying to sell their creative content in digital formats," she says.

The best thing that happened in that market segment in the past year, she says, was 4fun.bg. 4Fun is a project of Universal Music Group and Bulgarian telecoms group BTK, which provides subscription-based access to music from the Universal catalogue to subscribers of the BTK ADSL broadband service.

For now, internet users who are not subscribers of BTK’s ADSL service do not have access to the service. If it was up to Kileva, more partnerships like the one between Universal and BTK would exist. When asked why there weren’t more deals, she put the blame squarely with local area network (LAN) internet providers.

"According to data from 2004, there are more than 240 LAN-network providers in Bulgaria. Part of the problem is the existence of piracy on these networks. Several of the larger networks would like to have regulated, legal access to music and to support the introduction of these legal options. But it is unfair competition [in the form of piracy] which makes any such attempt lose all credibility," Kileva says.

"Last year we organised a round-table where this was the topic: the desire to form partnerships with providers," she says. "But every time there was this unfair competition of piracy."

Then there was the question of pirated data on ftp servers on the LAN-network. "The business model of these LAN-networks is based on providing their users access to these servers.

One of the biggest arrests that we have taken part in was in Dobrich in 2007, one of the biggest blows against a local provider," Kileva says.

"We found 30 terrabyte of pirated content on 12 servers; music, films, software, games, but also television content. Three weeks ago we received a notice from the prosecution that the investigation had been stopped. Apparently, the owner and the administrator had said the passwords had probably been stolen and that the 30 terrabyte of content was uploaded to these 12 servers by someone else," she says.
Since then, the Supreme Prosecution of Cassation  overruled the decision of the lower prosecutor’s office and the investigation will now continue.

Our own house
Asked about the inaccessibility of legal alternatives because of territorial restrictions in intellectual copyright laws, Kileva says: "This is not just a problem in Bulgaria, but it is a European problem. We have to open the common European market."
Intellectual property rights are territorial rights and in a market like the online market, which knows no borders, that can be a hindrance to reach deals and introduce legal download solutions. I think this is one of the big problems the European Commission has to solve."

We need to move to an open market with a simpler set of rules so that digital online sales have a chance against piracy. You are absolutely right that the average Bulgarian customer does not have a large choice at the moment."

Pressed about what advice she would give a Bulgarian user who does not have access to 4fun.bg because she uses a different internet-provider and who still would like to pay for digital content, Kileva says: "I cannot give advice to this user because access to the content of major labels for Bulgarian users depends on the mastodons to seriously consider this small market. If there would be a EU decision, we could benefit from that. Because the idea that our tiny market would be of any interest to these large labels, is very unrealistic."

There should be – though I am too small to say anything about something as big and important as this, as there are too many interests involved – but I think the major labels will not give up their direct management of licensing of digital content, because this is the future of the business."
But that would be one of the ways to make the system simpler," Kileva says.

"For us, as a local industry, it is important to get our own house in order and for the sales of Bulgarian products online to become more and more legalised. Then, Bulgarian artists will be able to profit from online sales."

According to Kileva, until now, only radio and television in Bulgaria paid due fees for neighbouring rights for broadcasting music. "The entire tourist sector, bars, restaurants, fitness clubs, all these places where they play music, they do not pay due fees," Kileva says.

"Abroad, around 90 per cent of fees paid for public performances of music come from these sources. In Bulgaria, this is simply not paid. For a year now we have been trying to get legislation introduced that would discipline the industry to sign contracts and pay these fees, but that seems impossible because the opposition is immense," she says.

As many branch organisations in the tourism industry as there are in Bulgaria, according to Kileva there is only one topic they all agree on: "That is their refusal to pay for the music they play."

Statistics
For the fist time, the IFPI has requested statistics about digital music sales in Bulgaria. "Different signs in the market show that digital sales are doing a lot better than physical sales," Kileva says.

"Our members are very active and have signed lot of deals. The data we are collecting, however, will not be representative of the entire market, because in the Bulgarian popfolk market a lot more is sold digitally. They have signed many deals already and there is much interest in this type of music. For them it is also easier, because they don’t have much of the reporting requirements than our members have. The popfolk producers have a much simpler model for these online sales. And, unfortunately, the largest players in this industry – Payner and Sunny – are not our members," Kileva says.