Royalty charges: IMI, AROI spat to resolve soon

Televisionpoint.com Correspondent | Mumbai
Differences between the Indian Music Industry (IMI) and the Association of Radio Operators in India (AROI), which represents India's 250-plus FM radio stations across 90 towns, on royalty charges will be a matter of past as both the parties have agreed to resume discussion after their meeting with the Information and Broadcasting Ministry.

The I&B Ministry held a meeting on December 12 with the music and radio industries' representatives, along with the registrar of copyrights and secretary, Human Resource Development, to initiate a fresh process for rationalizing music royalties for radio channels.

"The I&B ministry wanted both sides to talk and reach some sort of an understanding on music royalty fees. But that did not happen. Now the matter will be heard by the Copyright Board on January 28 where individual radio companies will present their case." said Apurva Purohit, president, AROI, and CEO, Radio City.

"In the meeting, it was agreed that the IMI and radio channels will start a fresh process for discussion of rationalizing music royalties for radio," Vijay Lazarus, president, IMI said.

The parties have also agreed that 'sound recording rights' and 'rights in musical/lyrical works' (tunes are copied by radio) are separate and FM stations need licence for both, not complying with which would be deemed an infringement of copyright.

The row started with FM radio stations saying that steep royalties were eating into their earnings, particularly those of smaller stations, making the business unviable, while music companies rejected the charge. The decision on royalties is now with the copyright board, which is yet to give its decision on January 28.

AROI pay royalty to the Phonographic Performance Ltd (PPL), which represents 160 music companies like Saregama India, Sony BMG Music, Universal Music, Tips Industries, Venus Records & Tapes and others.

AROI said the current formula means that FM radio operators end up paying 15 to 50 per cent of their annual revenue as music royalty fees, significantly above global benchmarks of 2 to 3 per cent. Overall, the industry earns annual revenues of Rs 550 crore of which about Rs 100 crore is paid as music royalty.