A long-running digital music royalties spat between record companies and organisations collecting on artists’ behalf has been settled.
Copyright holders will net eight per cent of the gross earnings from their work, less VAT. A minimum of four pence will be paid if tracks are discounted.
An alliance of the Mechanical Copyright Protection Society and the Performing Rights Society (MCPS-PRS) had proposed a new licence to cover electronic distribution. MCPS-PRS was demanding a 12 per cent cut of revenues from digital sales of whole tracks, above the 6.5 per cent it currently collects on CDs. Mobile ringtones are not covered by the new arrangement.
At the time, BPI general counsel Geoff Taylor complained: “The licence that the alliance is trying to impose for online music is unreasonable and unsustainable. It is charging a royalty rate on a download that is double the rate it charges for a song on a CD.”
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