Copyright Chaos: Are Current Copyright Regulations Killing Christian Music?

LUKE HUGHES-BUNGER from The Hub, Walsall writes:

OVER THE LAST FEW DAYS, several copyright related discussions have taken place amongst Christian retailers, publishers, suppliers and third parties, regarding copyright issues. In this in depth series of articles, I will be addressing some of these issues, starting today with music.

Be warned, it is quite long, and somewhat technical, but has been broken up into smaller, largely stand-alone Q and A type sections, if you have neither the time nor the  energy to read it beginning to end.

What do I need to know about playing music?

To be legally allowed to play music in a shop, permission is required from the original producer, and those who have recorded it. To simplify the process, most artists hand over this licensing to PRS for Music and Phonographic Performance Limited (PPL).

CCLI are an agent for PRS for Music, and possession of an affordable CCLI licence was traditionally a no-brainer for bookshops.

Until January 2011, churches, charities, not-for-profit organisations and other CCLI licence holders were exempt from requiring a PPL licence. However, after this time, changes in copyright law removed this exception, and anyone playing music from a CD in public is now required to hold both licences.

Undoubtedly, this is a prickly issue, especially for physical retail stores, who have already been forced to watch as digital downloads and online retailers based in off-shore tax havens have all but destroyed their sales of physical CDs already.

Why two licences?

Every time a CD or other music is played in public, there are actually three separate groups of people owed a royalty:

First, there are the copyright owners & composers of the songs (administered by PRS for Music); secondly, the group or artist performing the song on the CD (administered by PPL); and finally the manufacturer of the CD (also administered by PPL).

Keeping the two separate, then, actually makes a lot of sense for producers. Although often the royalties will go to the same place, it certainly simplifies things when, for example, recordings include covers of songs written by other people, or when new arrangements, tunes or melodies  of older works are written.

However, for people wanting to play their music, like bookshops, it certainly makes things more difficult.

What is the problem for booksellers?

These changes put booksellers in a very difficult position. For my own bookshop, for example, PRS and PPL licenses combined would cost me £217.70 each year.

The average cost of a CD is now £12.99, and the standard supply terms most bookshops receive on these are 35% discount. On average our profit is only £3.79 after VAT for each CD we sell, which means average sized retailers need to sell around 58 CDs each year, as a direct result of playing them, just to offset the cost of the licences.

For most of us, it’s an expense which is now impossible to justify, and one which few of us are ever likely to see a return from.

What’s more, the current regulations fail to acknowledge the clear difference between those who are playing the music to help sell it—where the artists will receive  royalty from the CD sale—and those who are doing it for entertainment, or other purposes.

It’s a catch-22 for booksellers and Christian music in general.

Without a licence, bookshops cannot play, demonstrate or effectively promote the music they sell: it’s the equivalent of having every book shrinkwrapped with no option to browse before purchase. Though CD sales are falling rapidly, Christian bookshops remain the first port of call for many churches, worship leaders and music lovers for information, inspiration and advice about music.

With a licence, bookshops can do this, but are forced to write off a huge portion of the profits from the CDs they sell. This introduces another loss for many already struggling bookshops, and forces bookshops to reconsider stocking CDs at all, as they are no longer profitable. Indeed, in some cases this will lead to further bookshop closures, all of which has largely the same negative effect on the Christian music market.

Why do we need permission at all?

In the simplest terms, because it’s the law. Copyright exists to protect the rights of content creators. It’s fair enough really: without copyright, anyone could reproduce, broadcast and redistribute anything they wanted, without any credit or payment to those who created it.

PPL and PRS blanket licences exist to simplify that process, and prevent the need  to get permission from each party, each and every time you want to play their music.

The problem, however, comes with the fees associated with that. These are set by PPL and PRS themselves, and are not laid out in law: there is no legal reason for them not to grant those licences for free, or at only a nominal charge, for those who are using the music primarily for promotional reasons. PRS for Music and PPL, however, continue to refuse to acknowledge that this kind of usage is different and distinctive from other performance.

Indeed, almost all other industries allow for such usage under what is broadly termed as “fair usage”. Book publishers, for example, do not require retailers to purchase a licence to cover them each time a customer flicks through a book in store. Art galleries are not charged a licence fee by artists for each time people visit the gallery, enjoy the paintings or photographs, but don’t buy anything.

In almost every other industry, it is understood that a level of promotional usage is required, and, indeed encouraged, and that royalties for content creators will be paid as a result of the increased sales.

Most people, including most music publishers, can plainly see that promoting their music for sale purposes is fair use and should be recognised as distinct from other kinds of performance, but PRS and PPL disagree.

Why can’t I get permission directly?

This is the question which has been asked most often recently. Indeed, most publishers seem to acknowledge that the way bookshops use their music is very different from that of most other venues, and would be happy to allow them to do so, but sadly, CCLI insist that they cannot. According to CCLI’s interpretation of the PRS contract which publishers sign, PRS for Music become the exclusive agents, and are the only body who can grant permission to use the music.

If this interpretation is correct (though the actual wording of the contract seems to imply it’s not so clear cut—feel free to take a look yourself) then even the  copyright holders themselves are not legally allowed to grant you permission, once they join PRS.

Are there any alternatives?

At The Hub, we have taken the decision to avoid taking out a CCLI and PPL licence, and instead are only playing CDs from independent artists, who are not represented by PRS or PPL. Our customers are largely happy—they still have background music—as are our independent artists, whose sales here have increased. In our case, this has been successful enough for us to be preparing our first live, in-store independent music event.

For others, specifically licensed “Background Music” may be the way forward: numerous CDs, and several internet radio stations are all available featuring music written and recorded by artists who are not members of PRS or PPL. This is then usable in store, either for a small one time fee to purchase the CD, ad-supported on the radio station itself, or for a regular low monthly or annual subscription.

Creative Commons (CC) is another great source of royalty free music (as well as images, video, writing, software code or other creative works). CC is a series of licences which, like copyright, seek to provide protection for content creators, at a level which they deem appropriate, but like open source, public domain or copyleft, also aim to also give content consumers some more freedom as to how they use this content. Encouraging musicians and other content creators to embrace CC, and making use of CC content, is a great way to help change those things which are broken about the industry.

Of course, all of these still prevent bookshop customers from sampling anything other than these few CDs, so it is also important that booksellers make their voices heard.

What else can I do?

Contacting CCLI, PRS for Music and PPL directly, and making sure that they understand your views, is important. Contacting publishers, and asking them to push PPL and PRS for exemptions for promotional usage will also help, though sadly, there is some indications that doing so is already falling on deaf ears.

Unfortunately, simply ignoring this is not an option: if you are playing PRS and PPL licensed music in store, in any capacity, either at a listening post, on personal CD players, for your customers to listen to on the shop floor, or even for your staff to listen to privately, without both licences, you are breaking the law. The grace period for CCLI license holders expired in January 2012, and PPL are now within their rights to demand that you possess a licence.

PRS for Music and PPL have both proven to be very hard-line when it comes to enforcement, though their agents CCLI tend to be much more understanding, and also offer much more affordable licensing terms.

Both, however, will almost certainly invoice you for your past unlicensed usage if they become aware of it. Much like TV licensing, informing them in writing that you are no longer playing licensed music will be helpful in preventing unnecessary hassles if you do decide to discontinue paying their licence fees.

Where do we go from here?

Following on from conversations in the Christian Authors, Booksellers & Publishers facebook group — which Christian musicians/artists are also welcome to join — a draft letter to Vince Cable MP, Business Secretary, has been drawn up highlighting the issues and calling upon him to take action before further damage to the trade leads to more bookshop closures.

If you share the concerns raised here, please consider adding your name to that letter as a signatory.

Discussions between PPL and PRS and booksellers are ongoing, and CCLI have stepped up to act as a facilitator for this. Though early days, signs are positive that by working together, CCLI and booksellers can work out more mutually beneficial licensing terms.

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