www.musicweek.com BODYTALKPRS FORMUSIC
20.04.12 MusicWeek 21
ROYALTIES FLUSH LICENSING BY ROBERT ASHCROFT, CEO, PRS FOR MUSIC
“The debate around streaming rates continues, and it is imperative for PRS for Music to balance the views of those in the creative community who think they are too low against those in the digital space who argue the contrary” ROBERT ASHCROFT
accompanies our films and underpins new digital services, where would be? While royalties from digital music services
I
t gave me great satisfaction to announce a rise in royalties collected and distributed to PRS for Music’s 85,000 songwriter, composer and music
publisher members during 2011. After what one website described as a ‘wobble’ in 2010, it was gratifying for all our members and staff to hear that our organisation returned to growth. We are ultimately accountable to our membership, so collecting and paying their royalties is among our primary concerns. However, we cannot overlook the considerable
challenges our organisation, and indeed our industry, faces. Several issues confront us and we must continually strive to defend our right to collect on our members’ behalf, upholding the value of their music by promoting and protecting the value of copyright. Collected royalties grew 3.2% last year while
international revenues increased by more than 10%, becoming one of the largest royalty sources for UK music creators. Yet, despite this success at home and overseas, our members are sometimes overlooked by those outside our industry. Without the creators and publishers of the music that fills our airwaves,
increased by an impressive 45% in 2011, there is still much work to be done to manage copyright in the digital space. PRS for Music, with our colleagues across the
music industry, is actively engaged with government on the recent Hargreaves Review of IP and growth, the Hooper feasibility review of the Digital Copyright Exchange and in measures to combat digital piracy. Digital royalties now constitute around 6% of
our total revenues, having started from a low base, but I believe our efforts in this area are being rightfully rewarded and our proactive and positive approach to licensing is paying off. We have licensed all that come to us who recognise the value of our members’ music and are willing to negotiate. As digital becomes the access method of choice for music users, we have to protect the value of music now and also in the future. The debate about streaming rates continues, and
it is imperative for PRS for Music to balance the views of many in the creative community, who think they are too low, against those in the digital space who argue the contrary. I notice again Tim Westergren’s comments that Pandora simply can’t make the numbers work in the UK due to our, and
Collected royalties grew in 2011 - but challenges remain
others’, streaming rates, however I’m thankful other services can. We remain ready to license our members’ music in the UK and Europe to any service that requires it. To date, 28 services are licensed on a pan-European basis. We continue to weigh the needs of the new digital economy with those of creators, but we’ll always defend the rights of our members; content and creativity need to earn too. So while we celebrate rising revenues, we must
also recognise that costs are under pressure. Like any business, we need to continually invest in new systems to ensure we have an organisation that can meet the considerable and varied needs of its 85,000 members and 350,000 customers. It has been well reported that our administration
rates and commission rates have risen recently as we switch the allocation of costs from MCPS to PRS for a limited period. The decline in sales of physical product, such as CDs and DVDs, has been well documented and, as mechanical revenues continue to decline, we still incur significant processing costs to distribute these royalties. It was a tough decision for our management and
boards to make and I know the impact this has on our membership, but I thank them for their patience as we change our business and reshape for the future. We believe this is the right thing to do for all of us, while we reduce the cost of processing and continue to grow revenues. As the first quarter of 2012 closes we trust the
music our members’ create will continue to be as popular in the UK and around the world this year as last, and we look forward to protecting the value of that music, however it is consumed.
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