Should Radio pay more for the music they play?

For around 40 years it’s been ‘the same old song’ from the Phonographic Performance Company of Australia (PPCA); Radio does not pay enough in performance fees for the artists and record labels it plays. And on May 10, they’ll sing it for a small but important audience in the High Court of Australia in an attempt to persuade it that the current arrangement is unjust under the terms of the Australian Constitution. The ‘current arrangement’ goes back to 1969 when the court ruled that fees paid to PPCA by commercial stations be capped at 1% of total revenue. The ABC, it ruled, would pay half of one cent per head of population.

The PPCA’s central argument is that since it is their product that is the main attraction for music station audiences which in turn attract the advertisers that drive the revenues that have made the stations rich, they should be entitled to a bigger slice of the pie. Should they?

 

Naturally, the radio industry will resist any rise to its cost base arguing that it is the musicians friend and earns its keep as the main driver of music sales. Besides times are tough – Radio’s had to invest in digital roll-out. And while the PPCA points to exponential growth in the number of stations over the past four decades, most playing music, the counter-argument is that revenues have not increased pro-rata but have instead been diluted between signals.

Radio and the recording industry have been codependent ever since 2SB (later 2BL) first went to air in 1923. If push comes to shove, could one do without the other? What arguments would you use to convince the High Court to up the rate for the PPCA or stay the same for the sake of Radio?