Publishers have mapped a completely different trajectory than their recording cousins. But make no mistake, publishers are battling their own downward demons, the worst of which may be ahead.

That was a takeaway Monday from a rather straight-ahead group of publishers gathered at Musexpo in Los Angeles. Instead of puffery and bull, this was a smart group offering a realistic take on their business. “Flat is the new up,” offered John Rudolph, CEO of Bug/Windswept Music.

Turns out that the fate of the recording industry is taking its toll on publishing. Sinking CDs mean sinking mechanicals, a major source of publishing revenue. But downward pressure is also being applied to synchronization and performance royalties. Kate Sparnberger, president of the Anglo-American Region for Peermusic, noted that there is “caution ahead on where performance revenues are going to go,” particularly in light of ongoing renegotiations with major television and radio groups.

The elements of a downward drag are fomenting. “There will be a dip, it’s coming, it just hasn’t hit yet,” Sparnberger advised.

But this was anything but a doom-and-gloom group. All businesses have their ups and downs, and if any sector is invested in the long term, it would be publishing. On that note, moderating journalist Emmanuel Legrand told the joke that “if there’s a nuclear blast, the only thing left would be cockroaches and music publishers.” Indeed, publishers are often there before an artist hits it big, and long after a career is over – or, in many cases, the artist is dead.

On the upside, signs of life are coming from outside investors, particularly the duo of Kohlberg Kravis Roberts (KKR) and Bertelsmann, parents of BMG Rights Management. Since its coming-out in 2008, the venture has acquired a considerable catalog, and the appetite continues. On hand at Musexpo was Deidre O’Hara, chief creative officer of BMG Rights Management (US), evidence enough of interest.

But this is a business undergoing some major changes, just like the rest of the music industry. Instead of just ‘banking’ on publishing catalogs and accruing gains over time, publishers are taking a more active role in developing artists and ultimately, longer term catalogs.

In the absence of a strong major label jumpstart, this is an ecosystem disturbed. Justin Shukat, general manager at Primary Wave Music Publishing, noted that many artists are seeking marketing support that the labels just can’t supply anymore.

Owen Sloane, chair of the Entertainment & Media Group at Gladstone Michel Weisberg Willner & Sloane, ALC, echoed the sentiment. In the current market, artists are “looking to publishers as a partner,” a far more active relationship. And what about the publishers that still want to sit back and collect royalties? “Those days are over,” Sloane assured.