PRS versus YouTube: what PRS For Music is telling its members

This was posted on Jockrock by Commander Keen. I haven’t seen the original.

Dear Member

You may have read the news stories this week about Google blocking access to ‘premium’ video content on YouTube in the UK as a result of their not agreeing a new licence with PRS for Music. Premium content appears to refer to music videos that are traditionally uploaded by record companies.

You may also have read that Google took this decision unilaterally, without any request from us to do so. Their licence with us had expired at the end of December 2008 and we were negotiating their new one. We do not usually ask anyone to remove content as long as good faith negotiations are taking place.

Immediately we heard news of Google’s decision to pull content from YouTube, and that they were talking to the press about it, we issued our own press statement. We expressed our outrage, shock and disappointment on behalf of UK consumers and on behalf of you, our members that Google should take this action.

Google’s decision must be seen as an attempt to influence commercial negotiation and the focus on ‘premium’ content as an attempt to cause disruption within the music industry again. This content may account for about 1% of YouTube music streams.

At the heart of Google’s precipitous action is the going rate for music. This is the rate set by the UK Copyright Tribunal in 2007. The Tribunal is the ultimate and independent arbiter of copyright dispute. Digital service providers pay a fraction of a penny per stream to the creator of the music.

Most of the major digital service providers are licensed by PRS for Music. And just recently we have signed deals with Amazon, Beatport, Nokia Comes With Music and Qtrax.

YouTube has signed-up to licences in very few countries around the world – we were one of the few. They have never before taken down content unless they have been forced to do so by copyright holders. Meanwhile, in the UK, consumer streams of YouTube ‘premium’ content have risen by almost 300% in the last year alone (up from 75m streams a quarter to nearly 300m streams a quarter). In total, Google want to pay 50% less than they paid before for that usage. Google think they paid too much last time. But their music usage, charged at the going rate, suggests they were significantly underpaying.

A further delay to our negotiation has been that Google is, at present, not giving us the data we need to calculate correct royalty payments to you. We ask them to make returns on their music use in the same way that every other major licensee does in order that we can properly analyse it, charge the right fee and then pay the copyright owners we represent. If there’s a stream of a track we don’t control, Google won’t pay us for that stream. Google would like to see our database in order to match it against theirs so they can calculate how much they owe us.

We look forward to continuing our negotiations with Google where we will be looking for them to pay an appropriate amount for the volume of music they use and the contribution that songwriters make to the success of their service.

In the meantime, please help us to help you. There are numerous Internet blogs hosting discussions on songwriter royalties. All too often, the voice of the composer and songwriter is lost in the midst of issues relating to the freedom of the Internet. Many blog posters misunderstand how royalties work and how you get paid. We should not forget that more than 90% of PRS for Music members receive less than £5,000 per year in royalties.

Wherever possible, please contribute fully to this online debate, putting the composer and songwriter point of view. Additionally, if you feel you could give your time, where needed, to talk or write to the media in support of PRS for Music and of the composer/songwriter community, please email us.

With best wishes

Steve Porter, Chief Executive, PRS for Music