[cma-l] PPL / PRS for Music mini consultation

Thu Feb 11 14:13:08 GMT 2016

I would add a rider on one specific point there Tony, but it’s a long one

“The law is civil, anyone can demand any fee they chose.”

Strictly speaking that is true, but that does not mean they can
automatically have the fee they demand. The law recognizes the privileged
position of the limited monopolies it grants to recognized collecting
bodies, are their demands are always subject to review and settlement before
the Copyright Tribunal.

The PPL vs AIRC ruling on which the current radio licensing is based is
arguably out of date, since it predates Community Radio licences, but it
does *not* provide for minimum fees, nor extra payments for additional
simulcasts. PPL is on unproven ground in making those demands. A
particularly pernicious aspect of minimum fees is of course that it removes
from PPL any strong incentive to come up with more cost-effective
administration or group schemes.

To deal with the one-sided situation of bodies being able to name their
price, the law permits anyone who feels they are not being offered fair or
appropriate licence terms to refuse to sign up, and instead pay what they
feel is properly due for a ‘deemed licence’. However, and this is where PPL
plays dirty, exercise of that right is subject to the would-be licensee
making an application to the Copyright Tribunal to adjudicate on the matter.

PPL is an aggressive corporate bully, and relies heavily on the fact that
most of its individual licensees could never afford the financial risk of
taking a case to the Tribunal (which has similar procedures to a court of
law), and PPL has a history of employing unnecessary levels of legal
expertise to rack up the potential costs for losers.

This situation has always in effect denied justice to smaller radio
stations, and even the big ones have generally been able to act only
collectively. It’s more than overdue for CMA to find some way of properly
getting the non-profit radio sector (Community and micro commercial together
ideally) for collective action to demand a fairer tariff. When we deemed our
own licence for two years we based it on a minimum fee of £50 + 1% of NBR,
and I believe that could have bene well-defended at Tribunal, but equally
PPL could have bankrupted us with just a few days of their legal costs.

I believe the appalling situation of the Copyright Tribunal for smaller
entities has been partly recognized by the introduction of a fast track
process,  but I am not sure how applicable this would be to our case.
However, I do think if it wants to do anything, CMA should have some
preliminary investigations of that.

I would *not* ask PPL to justify its costs – anyone can find plausible ways
to justify a scale ranging from zero (or even negative!) up to astronomical
figures. We should simply say what we feel are fair costs and apply those
across the board until PPL can get legal backing for its present unfair and
inequitable structure.  NB it is *fair* and equitable rates we are looking
for *not* just ‘reasonable’, since a hugely wide range of charges could be
considered reasonable (ie within the bounds of reason), even though they
might be clearly grossly unfair. A fine distinction to be sure, but I think
significant.

It occurs to me however, that if PPL continues to insist that the minimum
royalty tariff is fair, then they must by the same argument demonstrate
adoption of a minimum royalty *payout* scheme that gives, for sake of
argument, a minimum of £500 in royalties to any artist whose royalties for
reported music use would otherwise fall below that threshold; quid pro quo
(er, that’s not Status Quo obviously – they probably do okay!).

Sorry this is so lengthy, but beyond those points on the basic tariff, I
would like to add:

1)      I believe there should be at most a truly minimum fee to cover
reasonable admin costs of a licence, and I would assess those as £30-50. And
I believe a new threshold should be added below the current 2% step, with a
1% rate band up to half the 2% threshold – this is in line with the
Copyright Tribunal’s original reasoning for the 2% and 3% bands, and simply
recognizes that nowadays there are numerous stations operating at a lower
financial level that the Tribunal ever realized there would be a need to
consider.

2)      As for additional fees for simulcasting on Internet and/or DAB, I
believe these should simply be rejected *entirely*. If a station is able to
generate additional income from having any of these, then the value of that
will be properly recognized in the revenue figures. PPL's position is wholly
inconsistent - if you are given consent by Ofcom to add a relay that
quadruples your population or geographic coverage there is no change of PPL
agreement or tariff at all, and yet if you add a small area DAB simulcast in
your existing patch they want a massive increase in royalties.

3)      I would stay away from discussions of payments to the niche artists
that we all play but suspect aren’t getting their fair share of the dibs,
because the obvious answer to that one is for PPL to demand 100% 24x7 music
reporting. 

4)      I do believe is fair to levy royalties on broadcast-related revenue
Community Radio/non-profit licensees, as is the case at present. [Wrighty
note: it is not your ‘zilch profit’ that is assessed for royalties, it is
your revenue derived from broadcasting activities]. What I do not agree
with, as said above, is the levying of a minimum fee, and I feel 1% would be
a fairer first step on the tariff scale. 

Or we could ask Ed Vaizey to recognize in law that community/non-profit
stations do as much good for musicians broadly as they get in benefits from
the PPL repertoire, and to exempt them from the copyright regime, except
again perhaps for a nominal registration fee.

I do feel also that the constitutionally non-profit micro-commercial sector
(where I sit) and the enforced non-profit CR licensees should stick together
on this to make the case as broad and compelling as it can be.

But we won’t get anywhere without strong collective action led by a
determined body willing to take on a rough ride.

Phew, lunchtime methinks.

Alex

From: cma-l-bounces at mailman.commedia.org.uk
[mailto:cma-l-bounces at mailman.commedia.org.uk] On Behalf Of Tony Bailey
Sent: 11 February 2016 12:45
To: The Community Media Association Discussion List
<cma-l at mailman.commedia.org.uk>
Subject: Re: [cma-l] PPL / PRS for Music mini consultation

Don't take this as an endorsement but so far as I am aware:

Anything in the "public domain" has no rights attached to it.
Artist performance (as distinct from performance of the work) wasn't a legal
right. 
I think online payments are proportional to users.
The law is civil, anyone can demand any fee they chose.
Distribution is a matter for the representative organisation.
This is also a matter for the organisation and their members.

Tony Bailey

On 11/02/16 08:47, Ian Hickling wrote:

Isn't this an opportunity to go right back to basics? 

Why are we paying to use something that is essentially out there in the
public domain?
Why should we be paying artists to give their work exposure?
Should it be the other way round - they pay us?

If we decide to pay, shouldn't we pay in proportion to the number of people
that consume the product?

What authority do the two organisations have in Law to demand what amount to
random fees?
Where is the evidence of distribution and proportion to the alleged
beneficiaries?
As with Charities, how much of what is taken in goes to administration?

I'm prepared to put money on not getting a satisfactory answer to a single
one of those points.
Go on - surprise me?

Ian Hickling

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