Music Royalties for Aussie Night Clubs and Dance Parties Increases by 1500%!

Will also now be determined by max capacity not by actual audience.

Talk about killing a good time.

The Phonographic Performance Company of Australia’s (PPCA) application for an increase in “…music licence fees paid to artists and record labels by dedicated nightclub venues and commercially organised dance parties” has been approved by the country’s Copyright Tribunal and could have dire consequences for the clubs and DJs of Australia’s nightclub scene.

The approved increase means that clubs will now have to pay a licence fee of $1.05 per person, as opposed to the previous figure of 7 cents a person. To add insult to injury, the fee will be based on the club’s capacity and not the actual number of people present at any given time. What this means is that if a club can hold 500 people than it will have to pay $510, even if only 100 people attend the venue on an evening when music is played!

“It seems to be out of step with commercial reality,” said Anthony Ball, executive manager of policy for Clubs NSW, which represents more than 1300 clubs in the state. “If you are going to increase by that much, clubs will simply make the choice of unplugging the music.”

If my music licensing fees increased so dramatically, I mean 1500% and based on capacity not actual audience, could mean that many nightclubs may choose to simply withdraw music from their venues instead.

“The economics don’t stack up, and they will withdraw the service, and that will be disappointing in suburban and regional parts of Australia where a club is the only place to go to have a dance. I think it’s short-sighted and counterproductive,” said Ball.

Dance party organizers got the biggest increase, and will now have to pay $3.07 a person, up from 20 cents! This is an increase of more than 1500%, making it surely tough for Dance Party organizers to afford future events without dramatically increasing ticket or cover charge prices.

DJ Kads One of Melbourne, Australia said that dramatic rise in music licensing fees could have a detrimental effect on clubs and DJs in the city’s nightclub scene. “It’s going to make a difference, such a big increase,” he said. “There is so much music played in licensed premises and so much of it is played by DJs.”

The decision follows a two week long case before the Copyright Tribunal (headed by a Federal Court judge) which heard “expert” economic evidence on the value of the licensed music played in nightclubs and at dance parties.

The Tribunal found:” The object of the tribunal in approving the proposed scheme is to fix upon a licence fee that can be regarded, as nearly as it is possible to estimate, on the basis of the
evidence …as the fair market price for the privilege of playing the recorded music in respect of which (PPCA) is able to grant a licence. If it be the fact that the market rate is 30 times the rate that has hitherto been charged ..that is no reason why it should not now charge that rate.”

Responding to the decision, PPCA Board member and Mondo Rock musician Paul Christie said, “An increase in these tariffs is long overdue and will help compensate artists who create the product which is the foundation of the nightclub and dance party industries. Artists are entitled to a fair day’s pay for a fair day’s work and this will go some way towards compensating us for our creative output.”

Former drummer for the Go-Betweens and PPCA Board member Lindy Morrison said, “When we lose a musician in Australia the public grieves. It reminds us that many of our recording artists have very little finance to fall back on as they grow older. In my experience the community recognizes that musicians have been given a poor deal and that’s why these tariffs are important. Music bestows a cultural bond between us all and artists should be valued for this.”

Hmm, I wasn’t aware that a hit song was meant to be a retirement plan and that we have to pass around a hat everytime we want to listen to a good song. Royalties are one thing but, extortion is another.

In any event, this move by the Australian PPCA merely proves what many have know for some time – that the music industry as we know it is dying and it will go to great lengths to replace lost income in any way it can. To fight back, all we can do is continue to support artists directly or buy digital music instead of physical CDs.
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