In the last several Congressional sessions, pro-recording industry advocacy group musicFIRST and a small group of legislators on both sides of the aisle have attempted to get the American Music Fairness Act passed. Each time, the effort has died, as a robust coalition of Republicans and Democrats have said no to more fees assessed to broadcast radio for the airplay of recorded music the music industry largely benefits from as free promotion and publicity.
In Australia, an effort to raise broadcasters’ royalty rates has passed. And, the dollars they’ll need to pay will be far greater than what they’re paying now.
As reported by blogger Tom Marshall, Australia’s Copyright Tribunal agreed to increase the royalty rates paid by radio broadcasters for the use of sound recordings from 0.4% to 0.55% of gross industry revenue.
While that may not sound like much of a jump, the ruling is retroactive to July 2023.
And, when it comes to total royalty payments, the old 0.4% rate resulted in radio royalties of approximately $2.68 million USD each year for recorded music rights holders in 2023.
The new 0.55% rate increases radio royalties to $3.68 million USD per year. And it arrives after a period of stagnation. It was 1999 when the last royalty rate agreement between the Phonographic Performance Company of Australia (PPCA) and radio broadcaster industry group Commercial Radio & Audio (CRA) was agreed upon. It expired in 2003, with extensions on a monthly basis coming for the following 19 years. In 2022, the PPCA notified the CRA that it would end the agreement in June 2023.
The lack of a new agreement led to the Copyright Tribunal. And, the PPCA got what it wanted based on its argument that radio airplay is a lesser promotional tool for recorded music thanks to streaming audio platforms, as well as social media.
Furthermore, the 38% rate increase keeps Australia near the bottom of global markets for sound recording royalty payments. According to Marshall, only Japan and the U.S. pay fewer royalty fees.
View the entire Copyright Tribunal decision by clicking here.
