Re:Sound seeks big hikes in music royalties

Musicians and recording companies are seeking significantly more money from broadcasters and online streaming services in Canada for use of their recordings, according to applications filed with the Copyright Board of Canada. Re:Sound Music Licensing Co., which represents artists' and labels' royalty rights in Canada, currently has proposals before the Copyright Board for new royalty rates on music played on conventional commercial radio, satellite radio and the Internet. Re:Sound has asked for new tariff rates on non-interactive and semi-interactive webcasting for 2015, in a royalty known as Tariff 8, even as the collective has turned to the courts to overturn rates for 2009 to 2012 that the Copyright Board set in May. The collective’s new application for Tariff 8 asks for $1.22 per 1,000 plays per track for standard commercial webcasters, as compared to the 10.2 cents that was certified by the board. Re:Sound president Ian MacKay said the rates his group seeks for Tariff 8 are more in line with the amount paid in other jurisdictions, including in the United States. " is almost exactly 10 per cent of what the rates are in the U.S. for the same services and the rates that were set in the U.S. by the Copyright Tribunal there," he said in a phone interview. He added that the tariff that was set in Canada is "significantly" less than rates Re:Sound negotiated with some streaming providers as all parties awaited the May decision on non-interactive and semi-interactive streaming, which was previously not subject to a tariff. In that Tariff 8 decision, the Copyright Board addressed differences between rates set in Canada versus the U.S.: " are intended to reflect competitive market outcomes and to account for the promotional value of air play. In Canada, the only overreaching requirement is that the rates be fair." Re:Sound's application for Tariff 1.A, which would apply to commercial radio between 2015 to 2017, asks for 4.46 per cent of the first $1.25 million of gross income from stations with typical music volumes and 6.5 per cent on money made beyond the first $1.25 million. The current tariff in effect for commercial radio sets a royalty rate for Re:Sound of 1.44 per cent for the first $1.25 million of gross income and 2.1 per cent on money beyond that. The music collective is also asking for the added benefit of 0.5 per cent of gross income from radio stations that play their music at public venues. The new application also attempts to add the provision that separate stations owned by the same company would have their gross incomes combined for the purpose of calculating royalties. The rates being sought on commercial radio for 2015 by Re:Sound are mostly in line with what was asked for in the proposals it made for tariffs that would have covered 2012, and 2013 to 2014, of which certification from the Copyright Board is still pending. "They've made these proposals in the past, and the Copyright Board has rejected them and set the rates as they are," Gabriel Van Loon, a lawyer representing the Canadian Association of Broadcasters, said in a phone interview. "So unless there's some material change in the industry in the broader framework to justify an increase, I don't see why they would think they deserve ... three times as much as they're currently getting." "I haven't seen any evidence of massive increases of revenue or profitability, or anything like that that would justify ," Van Loon said, adding that even it there was, the collective would benefit because "if revenue goes up, they get more money anyways." Re:Sound has applied for 17 per cent of service revenue from satellite radio services using its material, or a minimum of $1.50 per subscriber. This is referred to as Tariff 4 and would cover 2015 to 2018. The current tariff in place gives Re:Sound, — previously known as the Neighbouring Rights Collective of Canada (NRCC) — 1.18 per cent of service revenue, or at least 12 cents per subscriber. Re:Sound has also asked the Federal Court of Appeal for a judicial review of the Copyright Board's decision on webcasting tariffs for the years 2009 to 2012, which remains in effect until another rate is certified. MacKay said he expects the court process regarding the appeal of Tariff 8 to take six to 12 months. The applications for future tariff rates could take even longer, given the Copyright Board's precedent. Re:Sound had applied for webcasting royalty rates in 2008 for the webcasting decision that was issued this year. Current tariffs in effect for commercial radio, satellite radio and Internet streaming are all past the terms they were meant for, with expiry dates, respectively, of 2011, 2010 and 2012. MacKay testified during the House of Commons heritage committee hearings on the music industry this year that participants on all sides expressed dissatisfaction with the time it takes for the Copyright Board to make decisions. "Everybody was saying that the length of time that this takes and the uncertainty that this leads to is problematic for everybody," he said. "It's problematic for the people that have to pay the tariff because they don't know, sometimes for years, how much they have to pay. It's problematic for the musicians, the creators, because they're waiting to find out what they're going to get paid. "It's also problematic, if you have rates that are going back several years, to collect on those. Going back to collect for periods of 2009 to 2012, some of those services might no longer be in business." — With reporting by Derek Abma at dabma@thewirereport.ca and editing by Anja Karadeglija at akarad@thewirereport.ca

Re:Sound seeks big hikes in music royalties

Broadcast | August 1, 2014

Unlock all the Canadian telecom, broadcasting and digital media news you need.

FREE TRIAL

SUBSCRIBE

Inside The Wire Report

Information

Hill Times Publishing

Get in Touch With Us

Re:Sound seeks big hikes in music royalties

Broadcast | August 1, 2014

Unlock all the Canadian telecom, broadcasting and digital media news you need.

FREE TRIAL

SUBSCRIBE

Related Stories

Canadian media companies sue OpenAI for copyright infringement, could cost $322 billion

Coordinated effort is ‘essential’ in tackling AI policy issues, says Canadian Digital Regulators Forum

Government working with AI researcher Mila on governing use of cultural content

Copyright Board joins Canadian Digital Regulators Forum

Reuse & Permissions

Inside The Wire Report

Information

Hill Times Publishing

Get in Touch With Us