The European Music Managers Alliance (Emma) has called on the continent’s copyright collection societies to involve artists and their representatives in any discussions about how to set new licensing rates for livestreamed concerts.

The umbrella organisation, which represents Music Managers Forums in the UK, France, Finland, the Netherlands, Sweden, Norway and Poland, warns that if performance rights organisation (PRO) tariffs are levied at too steep a rate, this could kill off this growing format by making the majority of live streams financially unviable.

According to Emma, the actions of “certain PROs and major music publishers” – which have unilaterally decided live streams are akin to a music stream, rather than a live show, and so subject to much higher digital audio tariff – “are threatening the viability of ticketed livestreams across Europe”. The estimated size of these digital audio-based payments is “is so high that it would make the majority of livestreams unviable”, the association warns.

Emma’s intervention follows controversy over the decision by PRS for Music, the UK PRO, to impose without consultation a new tariff of up to 17% on livestreamed shows, in a move criticised by the UK Music Managers Forum, among others. PRS today (16 February) announced a consultation, or “call for views”, on the tariff, which runs until 12 March.

“Set licensing rates too high, and the costs of producing livestream shows simply won’t stack up”

Emma says while it agrees songwriters must be fairly compensated when their songs are performed in a live stream, European PROs should instead apply their standard live tariffs to ticketed livestreamed events until a new livestream rate is agreed with artists and managers.

“Everyone wants live shows to return as soon as it’s safe for audiences to come back. In the meantime, livestreaming has provided one of the few alternatives for artists to perform before an audience, build a fanbase, and generate revenues through ticket sales,” comments Emma chair Per Kviman (MMF Sweden).

“Emma is urging PROs across Europe to be sensitive to these facts, and that the imposition of any new licensing tariffs should involve full and open consultation – including with artists and their representatives.

“Get the balance right, and we could nurture a vibrant new format that complements live events and provides artists and songwriters with a valuable source of revenue. But set licensing rates too high, and the costs of producing livestream shows simply won’t stack up.”

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Citing feedback from its members, UK performance rights organisation PRS for Music has amended its controversial tariff for small-scale livestreamed shows to exempt artists performing their own material.

The new ‘small-scale Online Live Concert licence’ – which levies a minimum 9% fee on events generating less than £500 – has been sharply criticised by the industry for punishing grassroots venues, artists and promoters, and has reportedly already led to a number of cancellations.

These small-scale events will now be covered by a free licence, available “throughout the period the live sector is forced to close due to the Covid-19 crisis where the qualifying member is the performer”.

According to PRS, the benefits of the new mechanism are that it “allows performing writers the latitude to test the online concert market to find a model which works for them”, as well as to allow writer-performers to “more easily hold a concert in support of others in the industry, such as charity gigs”.

“The change announced today we hope addresses many of the concerns expressed to us”

PRS says it will also be “accelerating its ongoing dialogue” with the industry about a fair interim rate for other live streams, including large shows, while physical live concerts are not possible. “We are committed to agreeing a discounted rate for larger concerts as soon as possible to make these licences available to the market,” reads a statement.

“We are committed to making sure that our songwriters, composers and publishers are well supported, so it is essential that all our members share in the value being generated by online livestreamed concerts when their songs are performed,” says Michelle Escoffery, president of the PRS Members’ Council.

“The change announced today we hope addresses many of the concerns expressed to us over the last few days. PRS will continue to listen to the views of our members in these most difficult of times.”

Mark Davyd, CEO of Music Venue Trust, comments: “We warmly welcome this logical revision to the previously announced tariff which has already seen hundreds of live events lost, costing performers and songwriters vital opportunities to generate desperately needed income during this crisis. The announcement of the online small-scale tariff last week, without prior consultation or discussion, was ill conceived and poorly executed. It is good to see PRS for Music acknowledging their error by immediately removing this charge.

“We note that once again the statement is issued to press without consultation or discussion with the sector most impacted by it. A long-term solution that ensures that songwriters whose work is performed in the grassroots sector are recognised and rewarded is achievable. It requires PRS for Music to enter into serious discussions in good faith, prepared to listen and prepared to consider evidence that can result in positive, forward-facing solutions for all stakeholders.

“We look forward to a full and inclusive consultation on these matters in the days and weeks ahead”

“Grassroots music venues want to pay the right songwriters an appropriate fee for the use of their material. The creation of songs is the beating heart of what our sector is about. Let’s work together to fix a broken system that recognises and rewards that.”

I a joint statement, David Martin, CEO of the Featured Artists Coalition, and Annabella Coldrick, CEO of the Music Managers Forum, add: “We are pleased that PRS for Music have listened to calls from artists, managers and others across the industry. It is a welcome step forward that writer-performers playing their own material will be exempted from paying for a licence at small-scale livestream shows.

“We also welcome that PRS will now begin dialogue with artists, managers and other key stakeholders about the licensing of larger livestream events, and commit to agreeing a discounted rate while ‘in-person’ shows remain closed. Decisions around collection and distribution of revenue impact cross-sections of the music industry and cannot be taken on a unilateral basis. Therefore, we look forward to a full and inclusive consultation on these matters in the days and weeks ahead.”

Qualifying members can obtain a free PRS licence for small-scale online ticketed events by emailing [email protected].

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The Music Managers Forum (MMF) and Featured Artists Coalition (FAC) have written to PRS for Music, the UK performance rights organisation, to protest a proposed new tariff for livestreamed concerts, which the associations criticise as “unworkable” and punitive to artists.

The MMF/FAC letter, which can be read in full here, is countersigned by more than 50 artist managers, including representatives for Dua Lipa, Biffy Clyro, Liam Gallagher, Bicep, Fontaines DC, Gorillaz and Yungblud, as well as a group of FAC member artists and songwriters.

The proposed tariff for live streams, described by PRS as a “temporary experimental and non-precedential rate structure”, has been devised without any consultation with industry. It would see a fee of up to 17% of gross ticket sales levied on livestreamed events, and would apply retrospectively to events which have already happened.

Even for the smallest events (those grossing under £50,000), the tariff would be 8% – double the 4% generally charged on a physical concert under the existing tariff ‘LP’.

The proposed tariff, particularly at the top royalty rate, compares unfavourably to the rates charged in several other European countries: The Netherlands’ Buma, for example, has a 7% tariff for live streams, while Germany’s Gema licenses live streams under its existing VR-OD 10 tariff, which is charged at a flat rate up to a maximum of €1,200. (By contrast, 17% of £450,000 is £76,500.)

“A starting rate 8%, rising to 17%, will make livestreaming unviable, for [all] artists”

The letter, addressed to PRS for Music chief executive Andrea Martin, says that while the associations accept that songwriters must be compensated fairly for use of their work in live streams, the 8–17% rate will make livestreaming – a format which has “presented artists with one of their few opportunities to perform and connect with their fans” this year – financially “unviable, for both the smallest emerging artists and the biggest superstar acts”.

“The larger, most-successful events involve significant production costs, and have provided a lifeline to crew and other industry workers,” write MMF’s Annabella Coldrick and FAC’s David Martin. “At the other end of the scale, livestreaming has been increasingly important for emerging artists and those operating in niche genres. For the sake of all artists, songwriters and the wider industry, it is crucial that this new format is allowed to grow and thrive.

“Charging artists up to four times the live [LP] rate strangles, rather than nurtures, this innovation. For some of the smaller artists who have just covered their costs livestreaming, it will be impossible to find this additional money retrospectively.”

According to the MMF and FAC, PRS has so far declined to enter into consultation about the proposed tariff, and it’s for this reason the bodies are making their position public. Additionally, they are inviting more managers and artists to add their signatures to the letter to demand a “full and transparent consultation”.

“The proposed online live concert pilot licence scheme is still evolving”

This consultation, the letter concludes, “should also aim to provide certainty that PRS actually holds a mandate to license livestreaming events on a global basis.

“Until that process is concluded, we are working on the basis that the current live tariff is the applicable rate to these ticketed events.”

Responding, a PRS for Music spokesperson says: “PRS For Music members, alongside many others across our sector, have been very badly impacted by the shutdown of live music this year. We welcome the many initiatives to move live concerts online and PRS For Music has designed an online live concert licence, which will allow the necessary rights to be licensed.

“The proposed pilot licence scheme is still evolving. As conversations with our partners are active and ongoing, it would not be right for us to provide further detail or comment at this stage while we await their assessment and feedback.

“Of course, our primary role is to protect our members’ rights and to ensure they are paid fairly for their work, which is more important than ever now. We hope that these conversation will progress quickly.”

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UK performance rights organisation (PRO) PRS for Music has announced the launch of its upgraded Major Live Concert Service under the new brand MLCS™ by PRS.

MLCS™ by PRS is an online tool that shows local tariffs across global territories.  The aim of the service is to aid arena and stadium-level PRS members performing overseas to negotiate “full and fair royalty settlements”.

The tool offers a pre-tour royalty calculation service, details of headliner and support splits in each country – allowing for accurate forecasts of royalty streams throughout the tour – and provides a post-tour royalty reconciliation feature.

Upgrades to the service include fixed payment terms and further reduced administration fees, as well as a range of new technological solutions and streamlines processes.

Special administrative rates have been implemented for the MLCS™ programme, including local rates of 8.5% in some key territories. PRS for Music now charges an administration fee of £125 per set-list per event for members using the service.

“We acknowledge representing the world’s top talent comes with expectations, and we need to be in a position to offer a service that meets those requirements”

The PRO also states it is working on eradicating “promoter kickbacks” in some territories, and that it provides “full transparency to artists on all aspects of the royalty collection and distribution process” as part of the service.

“We acknowledge representing the world’s top talent comes with expectations, and we need to be in a position to offer a service that meets those requirements to be given the privilege of continuing to collect their concert royalties,” states Sami Valkonen, director of international, PRS for Music.

“We’ve taken on board feedback from several of our key member representatives and are committed to making MLCS™ a proposition that further solidifies PRS as the go-to provider of major concert tour copyright management.”

In 2018, £21 million was collected across 60 countries on behalf of nearly 200 PRS for Music members via the service. The tool was used for Ed Sheeran’s record-breaking ÷ tour and world tours by Bruno Mars, Rogers Waters, U2 and the Rolling Stones.

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What’s that saying: “nothing can be said to be certain, except death and taxes”.

In the live music and nightclub industry – some of the costs we have to pay to play recorded music or host live music often feel just like a tax – I’m talking PRS and PPL.

These two monopoly businesses rarely (if ever) get a good word said about them from the venues that have to pay these charges. They take our money, but they never support us – and without live music venues or night clubs, how would UK music acts ever develop into international stars?

There is no recognition from these copyright collection agencies that we are a vital part of the music industry in this country – whether we are grassroots venues, nightclubs, bars with DJs or festivals with DJ tents. We are just the magic money tree constantly paying our fees up to these monopolies, despite closures of grassroots venues across the country. The UK lost 45% of all nightclubs between 2005 and 2015, and pubs and bars are still closing at a rate of 18 per week in 2018. Ever seen PPL or PRS raising concerns or offering to help with this decline? No… me neither!

If we fail because of yet another massive increase in our running costs, it won’t just be the venues affected

And just to be clear, we and all other music venues are not arguing that we should not pay PRS or PPL; we do and will continue to support artists, bands and songwriters through paying for use of copyrighted music. This is about the amount that we are being told to pay.

In July, PPL (Phonographic Performance Limited) – which collects and distributes royalties for performers and labels when recorded music is played, as opposed to PRS for Music (the Performing Right Society), which pays songwriters, composers and publishers, including for live performances of their music – announced a review of its specially featured entertainment (SFE) tariff, which covers nightclubs, pubs and bars, cafes, restaurants and hotels.

Among other things, PPL’s proposals would include a revision of its ‘fee-per-person’ measurement, leading to proportionately higher charges for larger events. In its consultation paper, the collection society says that, “in line with PPL’s key principle of fairness, PPL believes that in a revised SFE tariff the ‘fee per person’ for all SFE events should be broadly the same, regardless of the size of the audience. This aim is easier to accomplish with attendance bands of equal size, and therefore PPL’s current thinking is that a revised SFE tariff should use consistent bands of 25 people regardless of the size of the audience.

“The fee would be set at the top of each band.”

This increase would not be economically viable for our businesses

The proposals from PPL are quite outrageous. We have calculated that for just one venue, the new tariff would increase the annual cost from just under £6,000 to nearly £60,000. The justification from PPL for this would be almost laughable if it wasn’t so potentially damaging to businesses.

They have said they have modelled that this is the amount that people would be prepared to pay for having music to dance to. At time when nightclubs have been closing at a scary rate, this clearly doesn’t add up. We know our customers and how much they are prepared to pay, and we know how business costs stack up, and this increase would not be economically viable for our businesses.

One of our trade bodies, UK Hospitality, has produced some strong arguments why these proposals are extremely damaging to an important sector of UK business – and if we fail because of yet another massive increase in our running costs (after many have faced massive business rate increases, payroll costs and, for many of us, hikes in rent) it won’t just be the venues affected.

Where will artists and DJs be playing? I suspect once again in illegal raves – and those rave organisers won’t be paying any taxes, including PRS and PPL, or making sure people are kept safe. I don’t see that as a future any of us wish for.

Julie Tippins is head of compliance for UK promoter and venue owner DHP Family, which runs Oslo, Borderline and the Garage in London, Thekla in Bristol and Rock City, Rescue Rooms, Bodega and Stealth in Nottingham.

Last year’s unpopular hike in live music tariffs by Sabam constituted unfair commercial practices, a Brussels court has ruled, handing a legal win to the Belgian festival sector.

A coalition of Belgian festival and concert promoters filed a lawsuit against Sabam, Belgium’s performance rights organisation (PRO), last May after tariffs were increased across the board, with the largest festivals seeing their payments to Sabam increase 30% as of 1 January 2017. The increase in both the festival and concert tariffs – slammed by Rock Werchter founder Herman Schueremans as a move that would “kill the goose that lays the golden egg” – were pushed through by Sabam after negotiations with industry groups failed.

In addition to increasing tariffs for events of all sizes, Sabam (Société d’Auteurs Belge/Belgische Auteurs Maatschappij) also began including sponsorship and subsidies in festivals’ revenues, “when these revenues are clearly related to the event”.

According to Jan Vereecke of Night of the Proms promoter PSE, who brought the suit along with Live Nation Belgium/Rock Werchter, Pukkelpop and GraciaLive, in unilaterally imposing the new fees, Sabam is “simply abusing its monopoly” while “offering no additional services in exchange for the price increase”.

Vereecke’s viewpoint is one shared by the Commercial Court of Brussels (Tribunal de Commerce de Bruxelles), which has found the PRO “guilty of unfair commercial practices by significantly increasing festival fees (up to 37%)”, according to court documents.

“The promoters have offered to renew the dialogue with Sabam – a proposal we will be happy to accept”

Sabam has been ordered to pay a fine of €5,000 for each day the newly illegal tariffs have been in force, up to a maximum of €1 million.

Responding, a Sabam spokesperson defends the new fees – 3.25%–6% for festivals and 3.5%–8% for concerts – which it says were implemented following a “comparative study” that showed Belgian songwriters and publishers were receiving a “lower salary than their colleagues in neighbouring countries”.

However, the PRO stresses it is willing to work with the wider industry on a number of points highlighted by the judge, such as the process by which minimum fees are set and how to take into account the exact share of Sabam repertoire played at their events.

“The organisers of festivals and concerts have offered to renew the dialogue with [Sabam] – a proposal we will be happy to accept […] on behalf of our members,” it says in a statement.

The decision comes as Sabam’s UK sister society, PRS for Music, continues to negotiate with industry groups over the rate of the new popular music tariff in Britain.

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The implementation of PRS for Music’s proposed new live music tariff has ground to a halt, following an objection over the lack of any provision for direct licensing, IQ has learnt.

The British performance rights organisation (PRO) announced last September it had the support of all “major relevant industry bodies”, including the Concerts Promoters’ Association, the National Arenas Association, Music Venue Trust and the Association of Independent Festivals, to push ahead with overhauling the 30-year-old popular music concerts (LP) tariff for shows and festivals, and had submitted plans for a new fee structure to the UK’s Copyright Tribunal for consideration.

However, “any organisation or person wishing to object” to PRS’s application was given until 27 October 2017 (later extended to 3 November) to do so, and PACE Rights Management – the company set up by manager Paul Crockford and agent Adam Elfin to assist public performance licensing directly on behalf of writers and publishers – made an official ‘request for permission to intervene’ over concerns that the new-look LP tariff failed to account for the growth of direct licensing.

The Copyright Tribunal agreed that PACE had a substantial interest, and granted it permission.

As revealed by IQ in July 2016, a growing number of major artists are choosing to bypass traditional blanket licences from PROs in favour of having their public performance royalties paid directly. The rise of direct licensing means many festivals are being forced to pay multiple licensees, as no PRO yet offers an ‘opt-out’ for artists who are not members and are licensing directly.

PACE made an official request for permission to intervene over concerns the new LP tariff failed to account for the growth of direct licensing

European festival association Yourope, for example, has advised against booking direct-licensing acts until a solution can be found.

On 22 February, PACE and lawyers for PRS appeared at the Copyright Tribunal hearing, which a person in attendance tells IQ went in favour of PACE, who sought non-ratification of PRS’s application and that all parties be asked to discuss a tariff that takes in to account direct licensing.

The parties are now in those discussions, ahead of a second hearing currently pencilled for 2 May. Any agreement reached by the parties, however, will only serve as assistance for the Copyright Tribunal to understand the various positions, as it has full authority to ratify or impose whatever tariff it deems reasonable and compliant with the law.

A spokesperson for PRS for Music declined to comment pending the tribunal’s decision.

Tariff LP has been levied at a flat rate of 3% of gross box-office receipts since 1988.

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The long-running review of the UK popular music concerts (LP) tariff looks to be approaching its conclusion, with PRS for Music confirming it has the support of all “major relevant industry bodies” to push ahead with overhauling the nearly 30-year-old fee structure for shows and festivals.

In a statement released today, a PRS spokesperson says the performance rights organisation has applied to the Copyright Tribunal to “vary the terms of tariff LP”, which has been levied at a flat rate of 3% of gross box-office receipts since 1988.

“This submission has been made with the support of all of the major relevant industry bodies representing the live sector, and is now with the tribunal for its determination. We have nothing further to add at this stage.”

The industry bodies in question are the Concert Promoters’ Association (CPA), Association of Festival Organisers (AFO), Association of Independent Festivals (AIF), Society of London Theatre (SOLT), UK Theatre Association, British Association of Concert Halls (BACH), National Arenas Association (NAA), Glastonbury Festivals Limited and Music Venue Trust (MVT).

A consultation on changes to the tariff closed in September 2015, and it was initially expected the findings would be presented last spring. At the time, PRS denied the tariff LP “only looks upwards”, describing rumours of an across-the-board rate hike as “wildly speculative”. “This has been a thorough, robust and detailed consultation process where we gave every opportunity for the industry to comment and contribute,” it added.

PRS live music tariff review continues

Last June, the Association of Independent Festivals said increasing the tariff would be “catastrophic” for independent festivals, and called for a dedicated PRS tariff for music festivals.

It is not yet known what changes will be made to tariff LP under PRS’s proposals – or if they will even be accepted by the Copyright Tribunal. Responding to IQ’s enquiries as to an expected date for the new tariff, a spokesperson says the decision is “in the hands of the tribunal”.

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The Association of Independent Festivals (AIF) has sounded the alarm against any move by UK collection society PRS for Music to increase the fees paid by its members, warning that any rise in the 3% popular music concerts (LP) tariff would be “catastrophic” for grassroots music festivals.

PRS for Music (formerly the Performing Rights Society) is currently reviewing the fees paid by its licensees. The current live music tariff, which collects 3% of gross box-office receipts per event, has been in force since 1988.

AIF supports the establishment of a festival-specific tariff for the UK, similar to the MS Tariff in the Republic in Ireland – a call echoed by participants at Eventbrite’s Free and Public Events Roundtable in April.

Paul Reed, general manager of the AIF says: “It is remarkable and absurd that festivals and concerts sit under a single tariff. With the global recorded industry in transition, independent festival promoters are taking risks on breaking artists and staging high-risk events on incredibly tight margins. PRS for Music’s plans to increase this already inflexible and damaging tariff could mean the bankruptcy of many events that provide a valuable platform for both emerging and established artists.

“PRS for Music’s plans to increase this already inflexible and damaging tariff could mean the bankruptcy of many events that provide a valuable platform for both emerging and established artists”

“There is a clear, unarguable need for a separate festival tariff. This already exists for festivals in [the Republic of] Ireland, a clear precedent and a workable model that PRS should consider and which would result in a solution that is fair, transparent and sustainable.”

Reed adds: “It is also prescient that PRS for Music has over 118,000 members and approached just under 32,000 of them as part of this consultation. They received just 48 responses from their members (0.15%), which is derisory. Songwriters, therefore, are not driving this process. Any increase would be a naked land grab by PRS, driven solely by their executives and some major music publishers.”

AIF argues that PRS for Music doesn’t currently take into consideration that many festivals are actually multi-arts events, or that not everyone is attending them solely for the music. It says that some AIF members have only 12% music content onsite, and are currently paying the equivalent of over 25% of their music programming budget as a result of PRS’s existing system.

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There were renewed calls for a music festival-specific PRS tariff at a meeting of British promoters of free events in April.

At the Free and Public Events Roundtable (part of Eventbrite’s Free series of exhibitions and discussions), which brought together representatives from Notting Hill Carnival, Sŵn Festival, Green Man Festival, the Southbank Centre, Transport for London, Pride in London, St John’s Ambulance, Royal Parks, the Association of Independent Festivals and Artichoke Productions, one attendee suggested the need for a festival tariff “which recognises that music isn’t 100% of the festival, because you have other entertainment, car parking, camping and other things you’re charging for”.

PRS for Music (formerly the Performing Rights Society) is currently reviewing its live music tariff, and the Association of Independent Festivals is backing a tariff tailored towards festivals. The situation in the UK was compared with the Republic of Ireland, where the Irish Music Rights Organisation (IMRO) already has an established festival tariff.

Other topics discussed at the roundtable included:

Licensing

• Attendees urged preparation for licence applications. A transport official urged promoters to present their pitch with the “utmost professionalism”: “Think Dragon’s Den and the process will be more efficient in the long run”
• The consensus was that safety measures need to be seen as a protection and never a burden

Funding

• Participants encouraged event organisers to work with sponsors with shared goals and urged for better communications between both parties in order to ensure a “flourishing partnership”
• Attendees stressed the need for effective integration, saying brands need to contribute to areas such as security, stewarding and cleaning if their activities impact the festival as a whole
• On the contrary, some event organisers highlighted the benefits of forgoing sponsorship, not least because it can create a point of difference

Competition

• Participants called for event organisers to embrace competition in order to keep free events exciting and innovative – one said: “Evolution keeps us on our toes creatively”

The report can be downloaded in full from the Eventbrite website.