More on that licence to listen to radio while eating
Posted on Monday, November 23rd, 2009 at 12:00pm. #
The other day, I posted about the rather unusual experience of listening to the radio in restaurants in the US. Since then, incidentally, I’ve heard a great non-stop-sixties radio station on Sirius/XM in a bar, and another unidentified radio station in a diner: it’s a widespread phenomenon that we simply don’t appear to do in the UK.
First, I guessed that this was something to do with PRS payments. It’s not – at least, the US has a similar payment, so I’ve been informed. So perhaps it’s a behavioural thing instead. I don’t quite understand why I’ve heard the radio in so many places, where I’d not in the UK. Any other thoughts would be welcome in the comments.
Notwithstanding that, my view (and it would appear those on Twitter agree with me) is that this is double-paying and is wrong. In my original post, I grumpily asked why the Radio Council isn’t looking at this and campaigning for radio to ‘come free’. But, being fair, this probably isn’t for the Radio Council, since that includes the BBC (and it’s probably not within the BBC’s licence terms to antagonise PRS for Music, much though it would be fun).
However, campaigning against this “double-dipping” would certainly be a RadioCentre thing (the UK organisation that represents most UK commercial radio companies). And the good news is that it’s not escaped the attention of the RadioCentre. Here’s an excerpt from Hansard, from a Culture, Media and Sport Select Committee from October 27th – with Andrew Harrison, the CEO of the RadioCentre. It’s interesting reading: and good to see that the RadioCentre is campaigning for this. (You can watch the entire committee – including lots of talk of digital switchover – here – this exchange starts at 2.05′25″).
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Q161 Janet Anderson: I wonder if we could turn to the issue of music licences in the workplace? I was very surprised recently, and I have an equestrian centre in my constituency in Darwen, and the owner wrote to me to complain – she only employs a handful of people – that she was required to get a music licence because they wanted to listen to the radio when they were grooming the horses. I took this up with the Minister and he confirmed that that was indeed the case. This was something that was raised with us when we visited Real Radio in Yorkshire. What are views about that and have you measured the likely impact on the reach of commercial radio?
Mr [Andrew] Harrison: Our views on this are very straightforward. We already pay 10% of our revenue to license music. We pay the record labels, the PPL, and we pay the artists and composers, the PRS. We already pay once for that broadcast licence. We think it is incredibly unfair that there is in effect double taxation on the consumers of our product that they are then obliged to pay for having the radio on in the workplace. It would seem a transparent example of iniquitous double taxation. The evidence we are beginning to pick up is that the rather aggressive licensing demands that the collecting bodies like the PRS and the PPL are putting on small shops, offices, hairdressers and factories are beginning to lead to a flurry of people certainly writing to us. I probably have 60 or 70 emails from people saying that they are going to switch off the radio. We are now tracking RAJAR quite closely, the audience measurement system, to see whether this is tracking through into a decline in listenership. We are very worried about it. Encouragingly, there was an important copyright tribunal case, the results of which were published last week, between the hospitality sector (pubs, clubs, nightclubs and so on) and the licensing bodies, which effectively ruled that the licensing deals that the collection societies had tried to publish were inappropriate. There has now been a demand that they will come down and potentially there will be rebates for operatives. We are looking at that ruling across pubs, clubs and nightclubs potentially as a template for what might be appropriate across shops and offices. The principal response has to be that we absolutely believe in the value of music and that it is right for our business that we should pay the rights collection bodies, but, having paid that to broadcast, we do not believe that there should then be double taxation on the recipients of our products as well.
Mr [Steve] Fountain: I would add to that that apart from the occasional annoying advert or song that somebody does not like or the moving of somebody’s favourite talent off the radio network, the one single thing that I get most complaints about is the tactics of PRS going into small premises saying that they need to have a licence. A number of people have said they are going got have to switch off; others have said that they work in areas where they may be able to listen on-line through headphones and stuff like that. It is hard to see that it will not have some level of impact somewhere.
Q162 Janet Anderson: Are their tactics quite aggressive?
Mr Fountain: That is certainly the feedback that comes to us. It is about: Have you got a licence? You need one and this is how much it costs. It is pretty direct. They see themselves as a business collecting the fees for their clients.
Q163 Janet Anderson: So that would apply even to the extent presumably of a small corner shop with one person in it?
Mr Fountain: It would be exactly the same.
Mr [Travis] Baxter: I echo what my colleagues have said. One of the things we find equally, which I imagine is similar for others, is, as you would expect, they ring us up because they think it is the radio station sending someone to them saying, “Oh, you are listening to our radio station. We are now going to charge you for the privilege”. We seek to explain that that is not the case, but it is quite difficult because they are sitting there trying to understand why they have suddenly been confronted by this charge, this double taxation, as Andrew [Harrison] said.
Q164 Janet Anderson: Would you remove that requirement altogether or would you perhaps have a different requirement according to the size of the workplace or the number of employees?
Mr Harrison: I would remove that requirement altogether. The truth is that we pay, as I have mentioned, just over 10% of our revenues in copyright, so we are repatriating over £50 million a year to the rights collection bodies for the benefit of playing music. That would seem to be a fair amount to me in return for that. Then penalising the listeners of that product would seem to be inappropriate. It is not something that happens across the EU, for example. There are other markets where that is not considered an appropriate way of dealing with this. It comes out of the historical copyright on public performance which we think belongs to a totally different interpretation around orchestra performance and that sort of thing rather than about radio stations. It is a loophole that we would like to see closed.
Q165 Chairman: To be clear, you are only concerned about the requirement on small businesses to pay a licence for broadcasting on radio, not broadcasting music. What about if they were playing CDs?
Mr Harrison: With my RadioCentre hat on, Chairman, yes, I am only concerned about radio.
