Musicians do not receive adequate royalties when their songs are played on broadcast radio, ACT Independent Senator David Pocock believes. Last year, he introduced a bill to overturn decades-long legislative caps on the royalty payments artists and labels can negotiate with the commercial radio sector; those caps, Senator Pocock says, unfairly limit musicians’ income.
Today, the Senate Legal & Constitutional Legislation Committee will hold a public hearing as part of its inquiry into Senator Pocock’s Copyright Legislation Amendment (Fair Pay for Radio Play) Bill 2023. It will hear from artists, copyright specialists, the commercial radio sector, music labels, and the recording industry.
But radio networks say that instead of improving pay for struggling artists, the Bill could instead give greater power and more money to multinational recording labels.
Under current laws, radio networks are prevented from paying more than 1 per cent of their annual revenue (gross earnings) towards licence fees for Australian music. In the 2022–23 financial year, commercial radio comprising 260 stations paid only around $4.4 million in royalties to artists and rights holders: some 0.4 per cent of their gross earnings, and less than some individual radio hosts are reportedly paid.
The ABC’s cap is at 0.5 per cent per head of population. In 2022–23, the ABC paid some $125,000 – less than their total travel budget for the year – for all music played on all ABC radio stations.
Currently, the industry pays around 0.4 per cent of their annual revenue, while globally the standard is between 1.5 per cent and 5 per cent.
Such caps do not exist for any other type of copyright in Australia, Senator Pocock remarked. As a result, composers and songwriters are paid more than an artist each time a song is played on broadcast radio.
Senator Pocock’s proposed changes would remove these caps, prompting broadcasters to negotiate with artists and copyright owners to pay the true value of what their songs are worth.
Senator Pocock said support for the bill had been overwhelming.
“Artists not only deliver huge economic and cultural dividends to Australia, they help tell us the story of where we come from, who we are and where we’re going as a nation.
“We can’t keep undervaluing the work of artists by not allowing them to engage in fair negotiations with the people and the organisations that use their works.
“This 50-year-old cap creates an uneven playing field for artists to have that negotiation and it has been described time and time again as anti-competitive.
“I know radio is facing its own challenges, but I don’t think it’s a big ask that they engage in a fair negotiation with artists and labels to determine a rate that is reflective of the value of the work being delivered.
“There is no other creative industry that is subject to a ceiling on royalties, this is unique both in Australia and globally.
“I think it’s time we scrap the cap, and I look forward to looking at the details further today.”
More than 500 artists signed an open letter asking for the Committee to recommend that the Bill be passed. They include Paul Kelly, Tones and I, John Williamson, Sarah Blasko, Briggs, Gang of Youths, Gordi, The Rubens, Courtney Barnett, Dom Dolla and Humphrey B Bear.
“Our art is our property, and it is the result of investing time, money, and talent,” the artists stated. “It’s made to be shared, but it has value, and we should be paid fairly for it.”
The Phonographic Performance Company of Australia (PPCA), the Australian Recording Industry Association (ARIA), the Association of Artist Managers (AAM), the Australian Independent Record Labels, Media Arts Lawyers, Support Act, and the Australian Copyright Council support Senator Pocock’s Bill.
However, commercial radio networks such as ARN Media, whose stations include KIIS and iHeartRadio, say this legislation would line the pockets of wealthy international music companies, rather than the musicians it is aimed at.
Without limits, the record companies would have dominant pricing power over the radio industry; they have indicated they would seek to raise the rate from the one per cent cap to a 2.5-5 per cent rate – which could ultimately lead to station closures, particularly in regional areas.
“Far from improving outcomes for Australian artists … the biggest beneficiaries will be the multinational record labels,” ARN said in a submission to the inquiry.
The Australian radio industry already pays $37 million in royalty and licensing fees every year; about $4.5 million of that went to the Phonographic Performance Company of Australia, which ARN says is owned by Sony, Universal, and Warner.
The ABC said its radio stations such as triple j and ABC Classic, and programs like Spicks and Specks and Like A Version – a popular segment where artists cover songs during live studio performances – could be affected if it is forced to pay more for music.
“It is in the public interest for public broadcasters to have access to music repertoire at a manageable and fixed price to ensure all Australians have equitable access to content; a cap achieves that purpose,” the ABC wrote in its submission.
However, the major recording labels who support the bill – including Sony, Warner and Universal – maintain the caps are unfair, uncompetitive and result in lost income for artists.
“We simply ask that recording artists, and those who invest in them, be permitted to obtain fair market rates – like every other copyright owner in Australia,” Warner Music Australasia wrote in its submission.
The Association of Artist Managers, who have previously rallied managers for stars like Missy Higgins, Jimmy Barnes, and Gotye, also maintain the importance of fair compensation.
But according to ARN Media, it is not clear whether the increased rates will be passed on to the artists.
“The labels have provided no evidence regarding the proportion of fees ultimately distributed to artists, and the Australian parliament should not take on trust that any extra collected following the removal of the cap will find its way to our songwriters, composers and performers,” they wrote.
With AAP
