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MMF criticises “sudden and dramatic” increases to PRS fees

By | Published on Wednesday 1 May 2019

PRS For Music

The Music Managers Forum and Featured Artists Coalition have called for an open discussion with PRS following the news that the UK song rights collecting society is increasing its admin fees on some income streams, including that flowing in from overseas.

The society alerted its members to the fee increases last week as it published its annual report and stats pack. Of course, PRS is a not-for-profit organisation owned by its members and would always argue that the fees it charges on the royalties that it processes are simply what is required to run the collective licensing system. But artists and managers have criticised last week’s “sudden and dramatic” increases and the lack of consultation before the fees went up.

The MMF says in a statement: “Apparently implemented to compensate for historic failures within PRS’s own distribution systems and pensions commitments, [the increases] will result in yet another levy on creators’ earnings – and at the very moment when, thanks to the monumental demand for audio streaming, their royalties should be increasing. New and upcoming writers will be penalised for the past business mistakes of others”.

In most cases PRS doesn’t directly license users of its members’ music beyond the UK, instead allowing its counterparts in other countries to collect monies from local licensees. This is then passed back to PRS which passes it on to its songwriter members, minus the fees that have just increased. The foreign society will also usually deduct fees from that income before passing it on.

This system also applies to digital, even though PRS directly licenses streaming services in multiple territories, and a lot of the society’s repertoire is actually bundled in to deals negotiating by the big music publishers. However, there are plenty of markets where streaming income still passes through local societies first, including some key emerging markets where streaming monies are starting to really boom.

Next week MMF will launch the latest guide in its ‘Dissecting The Digital Dollar’ series at the CMU+TGE Digital Dollars Conference at The Great Escape in Brighton. This explains the extra complexities that occur on the songs side of the streaming business, and how those complexities can result in songwriter royalties from Spotify et al getting delayed, reduced and lost as they flow through the system. The fees charged by societies, both at home and abroad, also impact on what monies the songwriters see.

MMF’s statement goes on: “In direct contrast to the artists who perform on recordings, who are increasingly compensated in a transparent and time-efficient fashion, those who write the songs frequently find their royalties shuttled through a network of overseas collecting societies and publishers. Such inefficiencies result in less and less money finding its way to songwriters’ pockets”.

“As a result”, it adds, “MMF is calling on PRS to provide greater clarification about this announcement. Alongside the Featured Artists Coalition, we would like to know the rationale for writers having to pay more in admin fees on both live and overseas income. We would also like more information as to how these decisions were reached, and confirmation that the raised period will be limited?”