While the web radio sector in the US fights a music royalty increase set by the country's Copyright Royalty Board which some smaller webcasters claim will put them out of business, in Australia it is club promoters who say they may have to close their doors after a ruling by the Copyright Tribunal there.
The Tribunal has been considering what fees club and party promoters should pay the Phonographic Performance Company Of Australia, which represents the royalty interests of the record labels and artists. Royalty fees for clubs where recorded music is played is based on capacity, with promoters being charged between seven and twenty cents per clubber in the past, depending on the kind of event and venue.
However, the record industry in Australia has argued that those rates are far too small, and have been pushing for an increase through the courts, who ultimately set royalty rates if licensees and licensors of music cannot agree on a rate. That campaign proved successful yesterday when the Tribunal ruled that royalty rates should rise to between AUS$1.05 and AUS$3.07, again depending on the kind of event and venue.
The decision has, needless to say, been welcomed by the music industry and artist community. The Sydney Morning Herald quote former Go-Betweens drummer Lindy Morrison as being "elated" by the decision, with her adding that recording artists had for too long been "subsidising" the profitable clubbing sector, whose business is wholly based on those artists' music.
But those in the clubbing and venue business said the decision could prove disastrous. The co-founder of a company called Fuzzy, who promote dance parties Field Day and Good Vibrations, said they'd have to add the extra AUS$3 onto the ticket price of their events, adding: "Nightclubs and dance parties compete against various other types of entertainment, so this fee makes them less competitive".
Meanwhile Bill Healey of the Australian Hotels Association, many of whose members run club venues, said: "The reality is we only have limited resources and we were primarily fighting an organisation underpinned by the four major record companies - Sony BMG, EMI, Universal and Warner. What will happen is that a large number of venues that operate as nightclubs just won't be able to sustain themselves because they have to pay a rate on the basis of the capacity".