New rules for online performances, here’s who has to pay royalties

Changing revenue streams The royalties collected are returned to the music company, composers and lyricist  

After Indian Performance Rights Society’s (IPRS) initial directive applying a high tariff rate for online live performances by musicians caused much confusion and concern among artistes, the copyright union has withdrawn the order, and will come up with a revised tariff list.

According to a new press release by the union, it will not charge for free events on YouTube, Facebook and Instagram that are not sponsored, branded or ticketed in any way — withdrawing its previous announcement that it would charge performers ₹20,000 for playing music belonging to those registered with IPRS. This means those jamming for free on these social media sites, from their personal account, need not worry. This applies as long as the COVID-19 crisis continues.

“We haven’t implemented it yet, you give us feedback, and after that we will revise the tariff. If it were normal times, it would have been implemented, but considering these are tough days for everyone, we thought let us work out something mutually acceptable,” says Rakesh Nigam, CEO of IPRS over phone from Mumbai.

There will also be no licensing fees charged for those playing Classical, devotional or folk music. IPRS has clarified that “the Tariff was not slated to come into force until it was approved by the General Body of IPRS.” The first order, it claims, was to engage with the stakeholders and receive feedback.

Who has to pay

Though the new tariff will be brought out in the coming week, here is how things stand now — in a ticketed event, if someone plays a song whose rights belong to a music company registered with IPRS, royalties will be collected from the artiste or the organiser. What the IPRS collects, will be distributed between music company, composer and lyricist in a 50-25-25 ratio.

“The IPRS has always had a team that is supposed to collect royalties for online live performances. The Copyright Act provides for it. However, there was no clear directive on how or whom they are going to collect it from,” explains Sandhya Surendran, founder and counsel, Lexic, a consultancy for the tech and music industries. “It is now, with online live performances having gone up due to the pandemic, that they have decided to come up with a directive.”

She emphasises that online license fees, as of now, apply only to the music belonging to IPRS members. With almost 6,000 members, the union includes bigwigs such as AR Rahman, Shankar Mahadevan and Javed Akhtar; the latter is its chairperson. Even if a show is not ticketed, if it is associated with a brand and the songs played are under IPRS, the event organisers will have to get the license. However, “If you’re an artiste registered with any international copyright society or playing songs of an artiste registered with an international copyright society, the tariff currently doesn’t apply to your concerts; because IPRS is yet to receive a mandate on the same from the international copyright society CISAC, that governs and leads the international processes and tariffs,” says Sandhya.

How it works

To pay the licensing fees, the artiste or organiser must go to IPRS’ online portal, fill in required details, and pay the tariff generated. What if the artiste is taking requests from an online audience? A new umbrella deal that Facebook signed with IPRS will “cover licensing and royalties whenever music represented by the IPRS is used on Facebook and Instagram,” says a press release. This does not apply to ticketed events. A similar deal is in effect with Google (YouTube). However, the system of cross-checking license and imposing penalties is not smoothly automated yet in India, explains Sandhya.

“The system adopted to keep track of usage of songs between international copyright societies employs the use of the ISRC and the ISWC,” she adds. (Each digital recording has a unique ‘fingerprint’ of sorts encoded into it, called the International Standard Recording Code - or ISRC code. ISWC or International Standard Musical Work Code is also a unique, permanent and internationally recognised ISO reference number for the identification of musical works.)

Sandhya recalls the case of a “fairly large South Indian music director”, a couple of whose songs received millions of downloads and plays. “He has got only ₹6,000 bucks over the last two quarters as royalties. The IPRS logs showed they were just from airline companies, even though the songs were played in hotels, malls, everywhere…” she says.

Until this confusion is sorted out, Sandhya fears it may lead to organisers wanting to hire only musicians who are not registered with the copyright union. “But that’s not good: you can’t collect your royalties if you aren’t registered. So it’s like a double edged sword, and at both ends is the musician.”

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Printable version | Aug 5, 2021 11:47:59 AM |

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