Tuned to licensing legality

Music licensing encompasses diverse industries like retail, F&B, Bollywood, etc. Music licensing bodies enable one to be conscious of the various perspectives of the process, explaining the implications of music licensing.

The use of music is happening all around us. The strain of music is now indispensible for pleasant consumer experience. However, playing music doesn’t come free. Its use, its performance requires the licensing right, and acquiring licenses in this space by potential players can surely take businesses to the next level. It covers diverse verticals including pubs, bars, salons, shops, restaurants, cafes, gyms, hotels, exhibitions, telephone-on-hold music, etc.

Authorised government bodies

The copyright societies registered under Section 33 of the Copyright Act, 1957 are authorised to give out licenses for public performances on behalf of the owners of the copyright music. As learnt by the information provided by Majmudar and Co, there are broadly three registered copyright societies in India – Society for Copyright Regulation of Indian Producers for Film and Television (SCRIPT), The Indian Performing Right Society Limited (IPRS) and Phonographic Performance Limited (PPL). According to Majmudar and Co., “With respect to any public performance, playing of music in cinema halls, hotels, restaurants, etc, they must acquire a ‘Public Performance License’ from PPL.”

Dimpy Mohanty, Partner, LexCounsel, and Chanda Sheemar, Senior Associate, LexCounsel also share their take on the same. They explain that in terms of the Copyright Act, 1957 (‘Act’), music played contains two distinct copyright works. One is musical work which implies work consisting of music and includes any graphical notation of such work but does not include any words or any action intended to be sung, spoken or performed with the music. Second is sound recording implying recording of sounds from which such sounds may be produced regardless of the medium on which such recording is made or the method by which the sounds are produced.

A checklist

Manish Tandon, Managing Director, Indian Cookery Pvt Ltd, opines that the process of acquiring these licenses is specific to the type of license or permission and can vary based on – duration of license, type of premise and nature of performance. Majmudar and Co suggests that the applicant needs to submit an application along with all the relevant information (the location of the public place, purpose, square feet area, number of seats, duration of license,  etc) to the copyright societies. They must remit the adequate amount of fee as per the tariff scheme of the copyright society. Generally, copyright societies do not refuse to grant such licenses.

According to an official of Select Citywalk, a South Delhi based mall, “There are no specific dos and don’ts which need to be considered. License Fee or Royalty will be based on the covered area of space, what kind of music are we playing and the owner of particular music is listed with PPL and IPRS or T-Series.”  The same official reinstates, “As per the PPL and IPRS rules on public performance of music, for any specific event, each retailer, restaurant, etc has to take a special permission on the payment of additional fee, despite they have obtained annual license for music play license. The charges of special license are exorbitant and a kind of hidden cost.”

Mohanty and Sheemar comment that, “The ‘convenience’ factor also of course plays a crucial role in checking piracy and infringement. Copyright societies keep tabs on uses of copyrighted works which they are responsible for administering.”

Not complicated

Tandon shares that in the case of PPL and IPRS, the laws are not complicated. Both the PPL and IPRS societies license similar types of music, representing work on behalf of different rights owners. PPL represents record companies, whilst IPRS represents lyrics writers, composers and publishers. Savio dsouza, Secretary General, Indian Music Industry (IMI), comments, “The law is not complicated to take a license. You need to approach two to three bodies to obtain a license that covers all the songs ever created and released across India. Worldwide, the process is the same. However, in some countries, more than seven to ten bodies exist to obtain a license. There has been enough of awareness in terms of the press writing about the issue.”                 

At a glance

• Specifically identify the works that you wish to seek a license for and the rights that you wish to obtain under the license.

• Think through all the key terms of the license including royalty, term, location of use, etc. and clearly define them in a written agreement.

• Ensure that the licensed rights are exercised within a year to prevent them from lapsing or otherwise incorporate appropriate provisions in your contract to prevent such lapsing.

• Do not play translations / remixes of songs unless you have specifically secured such a right in your contract.

• Ensure that you have renewal rights in your contract.

• Ensure that a license from the appropriate copyright society, i.e., the PPL and IPRS (which is authorised to administer the rights of publishers, lyricists and singers) is obtained.

* As told by Dimpy Mohanty, Partner, Lex Counsel and Chanda Sheemar,

Senior Associate, Lex Counsel

 

 

 

 

 

 

 

 

 

 

New business model

As introduced by IMI

• MMX of Label Mobile Media Pvt Ltd, the company which was launched by IMI, offers a license to shopkeepers involved in downloading songs on mobile phones. Currently, this is illegal as under the copyright act shopkeepers can be convicted and punishment ranges from six months to three years and fines from Rs 50000 to Rs 3 lakh.

• The profit margin in the mobile downloading business is far more than that in the mobile selling business. Margins on mobile phones are between 3-20%. Whereas the margin in the mobile chip downloading business is about 50%. It is also a valuable strategy in retaining customers by offering them the latest songs. MMX is a new business model focusing on IP marketing which will grow both in India and across the world.

*Shared by Savio dsouza, Secretary General, Indian Music Industry

 

 

 

 

 

 

 

 

 

Stay on top – Get the daily news from Indian Retailer in your inbox