Last Tuesday’s ruling on royalty in the context of FM stations was one that had FM channels ecstatic and musicians down in the dumps.
Private radio channels have got a respite after the Bombay High Court ruled that they don’t have to pay separate royalty to composers and lyricists for broadcasting their songs, but the musicians are unhappy.
“The high court ruled that the Indian Performing Right Society Limited (IPRS) that safeguards the copyright of music composers and lyricists is not entitled to claim or demand royalty or license fees from a FM channel for the recorded songs and music it plays on its stations,” reported IBNlive.
Let us analyse what the issue really is.
Any song that is recorded primarily has three creative aspects to it – the vocals, the composition and the lyrics.
The vocals are delivered by the singer (artist), the composition by the music director and the lyrics by the lyricist of the song. They are the original rights holders to these creative works.
When a sound recording is made, these creative contributors lend their creative works to the song for creating a sound recording or, plainly put, a song.
The Copyright Act, 1957 and its further amendments recognize the copyrights in musical, literary and dramatic works. Therefore, typically, the copyrights of vocals and composition would typically fall in the musical work and the lyrics fall in the literary work. Internationally, these rights are managed separately by different copyrights managers, such as music companies, music publishers and their respective societies who collect the revenue of their behalf.
The music company makes or acquires sound recording rights and a music publishing company acquires the rights of underlying composition and lyrics. The music company pays royalty to the singer-artist and the publishing co. pays royalties to the composers and lyricists from the earnings on each song.
The various public performances such as TV /Radio broadcast, live performances, playing songs in hotels, restaurants, pubs etc. are liable to compensate all the right holders of the songs being performed.
In India , typically, so far all the rights were acquired by the music companies either from the film producers or from the album producer/ artists as a complete basket with all the underlying rights. In most of the cases the composers and lyricists were paid one-time fees and they relinquished their rights in favour of either the music company or the film producer when their services were rendered for the sound recording.
In India , for last many years, the composers and lyricists have been fighting for the continuing rights to their works and have asked for amendment of Copyright Act to recognise their rights as distinct from the sound recording rights. IPRS which is the body of music publishers who hold the rights to the compositions and lyrics is a collection society for these rights and has some music companies (who also own the publishing rights) and many composers and lyricists as its members. IPRS has been collecting the revenues from public performances and broadcast/ telecast of songs on behalf of its members.
Tuesday’s judgment was on the plaint filed by an FM channel against IPRS challenging the right of IPRS to collect royalty for broadcast of songs on Radio. The plaintiff claims that the entire copyright of the song belongs to the music company as the song communication on Radio is usage of the sound recording of the song and not the exploitation of composition and/or lyrics separate from the song.
The court has held that once the sound recording is created the composition and lyrics become part of the new sound recording and so they cannot be separated from it. Therefore for communicating the sound recording there is no need to pay to the original owners of the underlying works (read composers and lyricists) and hence, the Plaintiff may only pay to PPL which represents the music companies who own the sound recording rights.
The basic premise is that once a sound recording is created comprising of lyrics/composition of a song, the sound recording becomes another entity of copyright and while exploiting it the rights of the composition and/or lyrics cannot be separated from it.
So, the FM channel need not pay composers/lyricists and should pay royalty only to the music cos. through PPL.
The need of the hour is to evolve a viable ecosystem that treats everyone fairly and is more in line with the international practice, where this differentiation is made and compensations are based on that distinction.
The further contention of the music industry has been that FM radio need to pay royalty to the music companies on a needle hour basis and not on the basis of their ad revenue.
The judgement will definitely be appealed against, and it’ll be some time before the dust settles on this issue.