IMRO vs. The Blogs: collective licensing of music

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"The collective licensing revenue streams, they are a-changin'."

Controversy broke out this week when Nialler9, an influential Irish music blogger, publicised IMRO’s demand that music bloggers pay for a Online Exploitation Licence. [Update: a group of Irish music bloggers met with IMRO on 6 May 2010 to discuss their concerns. Read about the meeting here.]

Like many blogs, most Irish music blogs are run at no, or very little, profit. Comments on the main posts about the issue generally share a sense of outrage and a belief that IMRO’s demands will damage new Irish music.

Incredulity is also expressed that the bands involved generally provide the music to the bloggers in the hope that it will be promoted online. The Guardian sums up the issue as follows:

If IMRO goes ahead with its plan, targeting music blogs around the world, there will soon be legions of frustrated bloggers. And it will be much worse if other regional publishers follow suit. While the organisations’ hearts may be in the right place – looking to buoy a flagging industry – we just hope they are going about it the right way. Will forcing the closure amateur music blogs make songwriters richer? Or precisely the reverse?

Collective licensing is a somewhat complicated area but it is reasonably certain that, whatever enforcement steps IMRO might or might not take against individual bloggers that refuse to buy a licence, it is highly unlikely that any agreement will be reached to exclude blogs from the licensing regime. [Update: However, it appears from the meeting between music bloggers and IMRO, mentioned above, that a new form of non-commercial licence might be considered.]

Collective copyright licensing

Individual collection of royalties from music users by music owners is extremely impractical. Therefore, a system of collective licensing has been established where by a licensing society can be set up, with rights to grant licences to play music on behalf of a class of copyright owners. The Copyright and Related Rights Act 2000 provides that music can be played in public or broadcast if the appropriate fees have been paid to the relevant licensing society.

The most well-known such society in Ireland is IMRO, which collectively licenses the performance rights of copyright musical material (ie. the part of a musician’s copyright relating to the public performance of their work). It collects over €30 million in royalties annually, which are distributed to its members.

There are other collecting societies that license other copyright works, such as the Newspaper Licensing Agency and the Irish Visual Artists’ Rights Organisation. IRMA is an association of record labels and is not a collecting society.

Comments on the blog posts already mentioned point to the fact that the musicians involved authorise the use of their music on a particular music blog. Nialler9 refers to his understanding of the situation, prior to hearing from IMRO.

Like many I thought that MP3s which were cleared by bands and labels for promo were provided as is – gratis and without any attachments or additional requirements other than to promote the band and song. Y’know, the same way an entire music blogosphere and a digital PR industry has been allowed to grow up over the course of the last 10 years thinking the same.

However, musicians can only licence the rights which they retain. If they have joined IMRO, they have entered into an agreement with the organisation. The first substantive clause (clause 2) of that agreement provides that the musician is assigning (ie. transferring) all their performing rights to IMRO.

Accordingly, IMRO members cannot grant a blogger a licence to the performing right in their music because they no longer own that right.

Controversy

The collective licensing system has not been uncontroversial. Similar arguments to those now raised by music bloggers were aired over a decade ago by independent retailers and coffee shop owners who felt that they should not have to pay an IMRO licence fee to promote new and local musicians in their premises.

One might wonder why IMRO has begun to target bloggers now; the answer probably lies in the comment quoted above from the Guardian. As music use changes, collecting societies are tracking new and increasing sources of revenue from such use.

In 2004, the European Commission warned sixteen collecting bodies that an agreement between them was potentially in breach of competition law on the basis that it proposed to carve up online music licensing on a national basis. The Commission published a recommendation in 2005 which said that the industry should be free to set up EU-wide collecting societies or to allow national societies to licence on an EU-wide basis.

Disputes

In Ireland, the Controller of Patents, Designs and Trade Marks deals with disputes regarding royalty rates charged by collecting societies.

[A]nyone who considers that they have unreasonably been refused a licence by a collecting society or considers the terms of an offered licence to be unreasonable may refer the matter to the Controller.

The terms of an offered licence include the proposed royalties or licence fees.

IMRO is not a one-stop shop

So: permission from a musician does not necessarily extend to a licence to use music online; neither does an IMRO licence give a full licence to use the music.

This is a common misunderstanding. Different venues and uses may require a combination of licences from IMRO/MCPSI, PPI, the record label responsible for the recording and/or the songwriter. For certain commercial uses of specific pieces of music, a licence from all of these parties might be required. Therefore, it is important to check with IMRO or a professional adviser as to what licences are necessary.

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