Govt clarifies copyright act applies to digital streaming services
New Delhi:
TIMES NEWS NETWORK
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In a decision that will help music streaming services, the Department of Industrial Policy and Promotion (DIPP) has clarified that all forms of broadcasting -including digital music streaming -fall under section 31(D) of the Copyright Act of 2013.Section 31(D) of the Act offers statutory licensing (SL) to broadcasting services, allowing them the right to offer music to their consumers at rates determined by the Copyright Board. This provision was brought into the Act to protect broadcasters from abusive practices of some music companies, who demanded unreasonable and unjustifiable royalties before granting permissions. Though the wording of the clause was quite clear in the Act, music companies had tried to create an impression that the section didn't apply to digital music services. With this clarification, DIPP has clarified that section applies to all broadcasters including digital music services.
Commerce and industry Minister Nirmala Sitharaman told TOI that the process for setting up the Copyright Board is on. She did not elaborate on the timeframe. Setting up of the board has been pending for a few years, but the minister has initiated the process. Government's clarification will bring major relief to services such as Gaana and Saavn, and will encourage them to renew commitment to their struggling businesses. Dhingana, another service, which was acquired by global giant Pandora, was shut down after being unable to fund music royalties. Guvera, an Australian music streaming service operating in India, is also struggling to pay its creditors. In addition, FM radio broadcasters have been unable to develop presence on digital because of the high costs demanded by labels.When asked to comment, an ex pert from a global consultancy firm stated: “Music companies should actually be giving their music at a very low cost initially to encourage multiple music services, which would help not only in curbing piracy but also in increasing their revenues from multiple sources However music companies have been thinking short term and increasing rates prohibitively making legal music services unviable and leading many of them to close down“.
In digital streaming, most music services are losing money significantly . Their royalty payments have grown by over 500% in the last four years, with built-in minimum guarantees to the labels. Digital broadcasters' revenues, however, have grown modestly as the business is taking time to develop. Labels also restricted how their music was used, initially offering web but not mobile rights, limiting how consumers could consume content, and restricting what partnerships digital music services could use.
Commenting on the clarification, Prashan Agarwal, COO of Gaana, said, “The clarification that internet companies are covered under SL is welcome. However, there was never any doubt in our minds that we were covered. This clarification will help the streaming industry grow and catch up with its peers internationally“.
Industry body IAMAI also issued a statement: “The clarification will also provide a relief to the spiralling annual licence fee paid to label companies that sometimes exceeded the revenue of many these startups....this clarification by DIPP now creates a level-playing field as the provisions of section 31D are not restricted to radio and television broadcasting organizations only , but cover internet broadcasting organizations also“.
Commenting on behalf of radio broadcasters, Prashant Panday , CEO Radio Mirchi said “Worldwide, radio broadcasters have moved towards streaming their on-air products as well as offering niche online products. Here in India, the huge minimum guarantees demanded by labels have made that impossible. What we forget is that the biggest losers in all this are the artists, the ones who deserve all the support and recognition possible“.
Commerce and industry Minister Nirmala Sitharaman told TOI that the process for setting up the Copyright Board is on. She did not elaborate on the timeframe. Setting up of the board has been pending for a few years, but the minister has initiated the process. Government's clarification will bring major relief to services such as Gaana and Saavn, and will encourage them to renew commitment to their struggling businesses. Dhingana, another service, which was acquired by global giant Pandora, was shut down after being unable to fund music royalties. Guvera, an Australian music streaming service operating in India, is also struggling to pay its creditors. In addition, FM radio broadcasters have been unable to develop presence on digital because of the high costs demanded by labels.When asked to comment, an ex pert from a global consultancy firm stated: “Music companies should actually be giving their music at a very low cost initially to encourage multiple music services, which would help not only in curbing piracy but also in increasing their revenues from multiple sources However music companies have been thinking short term and increasing rates prohibitively making legal music services unviable and leading many of them to close down“.
In digital streaming, most music services are losing money significantly . Their royalty payments have grown by over 500% in the last four years, with built-in minimum guarantees to the labels. Digital broadcasters' revenues, however, have grown modestly as the business is taking time to develop. Labels also restricted how their music was used, initially offering web but not mobile rights, limiting how consumers could consume content, and restricting what partnerships digital music services could use.
Commenting on the clarification, Prashan Agarwal, COO of Gaana, said, “The clarification that internet companies are covered under SL is welcome. However, there was never any doubt in our minds that we were covered. This clarification will help the streaming industry grow and catch up with its peers internationally“.
Industry body IAMAI also issued a statement: “The clarification will also provide a relief to the spiralling annual licence fee paid to label companies that sometimes exceeded the revenue of many these startups....this clarification by DIPP now creates a level-playing field as the provisions of section 31D are not restricted to radio and television broadcasting organizations only , but cover internet broadcasting organizations also“.
Commenting on behalf of radio broadcasters, Prashant Panday , CEO Radio Mirchi said “Worldwide, radio broadcasters have moved towards streaming their on-air products as well as offering niche online products. Here in India, the huge minimum guarantees demanded by labels have made that impossible. What we forget is that the biggest losers in all this are the artists, the ones who deserve all the support and recognition possible“.
Source: Times of India, 8-09-2016
