Streaming dispute before Copyright Tribunal this week

The radio streaming dispute has returned to the Copyright Tribunal this week.
The case looks unlikely to reach a swift conclusion unless one side or the other backs down in some way, and there has been no indication of that happening so far.
radioinfo has sought comment from both sides, but neither CRA or the PPCA are commenting while proceedings are before the tribunal.
The case concerns simulcasting of live free to air radio programs.

It does not encompass delayed replays, program downloads, podcasts, music streaming services or other kinds of online audio products. It is purely about simultaneous broadcast radio output by licenced commercial stations.
The PPCA is seeking an additional fee for online simulcasting. CRA, on behalf of the radio industry, is opposing that, because fees have already been paid for those broadcasts.
Before 2010, it was widely accepted that exact simulcasts of those same radio programs were considered “part of the broadcast and only required one fee,” due to a ministerial determination. In 2010 the PPCA asked the Federal Court to reinterpret the words of that ministerial determination to allow them to claim a separate fee.

A 2013 Senate Enquiry noted it would not be desirable for a court to change Government policy and regulation and recommended that the Minister could issue a new regulation if the parties could not agree to terms. But, in October that year the record companies filed for an additional copyright scheme in the Copyright Tribunal, leading to the present case now before the tribunal. Previous legal cases determined the PPCA’s right in law to take the issue further and the present proceedings are to “determine an appropriate commercial rrate,” according to the PPCA.

During the March session, lay witnesses will be heard, and in June it is expected that the focus will shift to economic and other experts.

CRA’s position is based on the view that the Phonographic Performance Company of Australia (PPCA) “is demanding the radio industry take out another licence and pay twice.”

Joan Warner is previously on the record as saying:

“Commercial radio stations already pay a fee to the record companies for the music we play. In addition, we pay copyright fees to the composers’ collecting body. Aside from the two lots of copyright fees we already pay for music played, we pay a spectrum licence fee to the Government for our broadcast licence, we are heavily regulated, we have local content requirements and high transmission costs for the broadcasts.

“Regional commercial radio stations are not as the PPCA describes a ‘billion dollar commercial radio industry.’  They are locally run, are integral parts of their local communities and provide local news, information and entertainment to communities.”

Simulcasts do not generate any specific additional revenue for stations, as all the content including ads is the same.
Because of the PPCA’s claims, regional stations have turned off their streams during this dispute, fearing that, if the radio industry loses the case, they will be liable for high ongoing fees and huge back payments. Capital city stations, which have higher revenue bases than regional stations, have kept their streams on for now.

The PPCA says the regulations that cap payments the maximum amount that radio stations pay have been in place for over forty years and now “unfairly limit the amounts paid to artists by radio broadcasters.” The record company collecting agency believes that they undervalue the use of sound recordings so that “artists are effectively subsidising the provision of content to the highly profitable commercial radio sector.”
The PPCA has based its court case on the view that the current cap on royalties fails to meet the “just terms” test of property law.
Section 152 of the Copyright Act is the relevant legislation. It says the Copyright Tribunal may not fix an annual licence fee (i) in excess of 1% of gross revenue of a commercial radio broadcaster for that broadcaster’s use of published sound recordings, or (ii) in excess of half a cent (ie $0.005) per head of population in respect of ABC radio broadcasts. 

“The present rate of the commercial broadcast licence fee is about 0.4% of gross commercial radio industry revenue,” according to the PPCA, which says this is out of step with the rest of the world and economically unjustifiable.

PPCA Chairman George Ash is on record as saying:

“Commercial radio uses music to attract around nine million people every week across Australia. This enables them to drive significant revenues and whilst we are proud of our part in helping the radio industry raise revenue and drive profitability, this partnership or relationship with the industry is unfairly capped by an antiquated and unjust piece of legislation.
“It is imperative labels and artists should be fairly rewarded for their contribution to radio’s profitability and the lifting of this legislative cap will allow both industries to find a fair and positive long term commercial relationship where artists are  rewarded justly for their creative works.”  

The longer the dispute drags on, the more likelihood there is of erosion of the listener base for those who listen to radio via streams on their mobile devices and PCs.
A resolution through the tribunal is not expected soon.

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