Royalty payments lack a coda

Local musicians will probably have to wait at least until the end of the year – and perhaps considerably longer – before seeing their share of the R561-million their representatives are claiming from radio stations; that is, if they do not end up squabbling among themselves about how to split it.

The National Association of Broadcasters this week asked for leave to appeal a decision delivered by a copyright tribunal in May, which sought to establish a method of calculating the royalties radio stations owe performers for playing their music. Given the complexity of the matter, chances are that leave will be granted, kicking off several more months of complex legal wrangling. It is also likely to be made all the more complex because there are no real precedents or procedures in place for copyright tribunals in South Africa.

“We don’t actually have clarity yet on where it would go if we get to appeal,” said association executive director Johann Koster. “It could go to a full Bench of the high court, or straight to the Supreme Court of Appeal. We do not even know who would decide that.”

The association will be arguing against a formula that would require music broadcasters to pay 5.95% of total revenue to the performers of the music they play, reduced pro rata for every minute they do not play music. If that is backdated to 2002, when legislation on the royalties was enacted, it could cost radio stations R1.46-billion, of which about 40% or R561-million would be due to local artists.

The collective body that would administer the distribution of these royalties, the South African Music Performance Rights Association (Sampra), is opposing the broadcasters’ association’s request for appeal.

“We don’t think it would be appropriate for a court to dissect a judgment of the copyright tribunal, and anyone who is dissatisfied can apply to the tribunal again in a year for a change,” said chairperson Keith Lister. “Rather than get involved in the delay and cost of an appeal, we would like to move on.”

Even if the matter is settled and radio stations, including those in the SABC, make the payment, it is not clear when performers would  receive the cash.

Record labels have agreed to split the royalty windfall 50-50 with performers but have no legal obligation to do so. Sampra does not expect trouble on that count, but admits there are further complexities to the issue.

Finding a needle in a haystack
SABC established. South Africa uses the British legal system for copyright, including performance royalties for music played on air.

South Africa introduces its own copyright legislation. Needle-time (the time used to play records) royalties for performers fall away. The focus is on composers, who are considered the most important part of creating music.

A new law on author rights introduces protection against illegal copying, but no royalties for ­performers are included.

With performance, performers and label promotion becoming ever more important, the music ­industry lobbies for the reintroduction of needle-time royalties.

Amendments create a framework for needle time but require regulations to implement.

The department of trade and industry publishes regulations for needle time, primarily relating to the method of collection. No rate is specified.

2006 – 2008
The South African Music Perform­ance Rights Association (Sampra), established by the Recording Industry of South Africa, is accredited as a needle-time collecting agency but fails to reach an agreement on a rate of payment with broadcasters. Procedural matters go to the high court, then to the Supreme Court of Appeal.

November 2011
With procedural matters out of the way, a copyright tribunal sits to adjudicate the dispute between the National Association of Broadcasters (NAB) and Sampra.

May 30 2012
The tribunal rules how needle-time royalties should be calculated, but it makes no finding on whether payments should be retroactive.

June 2012
The NAB files an appeal against the ruling of the copyright tribunal. – Phillip de Wet

There’s no substitute for the performers these days
Orchestra conductors may beg to differ, but for David du Plessis the matter of who should get royalties is fairly simple. “With classical music, most of the creative input is in the composition,” said the South African Music Performance Rights Association (Sampra) chief executive. “If you put the same sheet of music in front of any competent set of players, you are going to hear the same thing.

“Modern music has none of those directions for, say, tempo. With Lady Gaga, what you see on the sheet music is damn far from what you hear when she performs it.”

That change, from the primacy of the composer to the pre-eminence of the performer, is at the heart of Sampra’s quest to secure airtime royalties for the performers of songs. Composers and authors get royalties in South Africa under the administration of the Southern African Music Rights Organisation (Samro), but the performers — the stars who draw the crowds with their renditions or gyrations, or both – see nothing other than what their record labels share with them. And sometimes that is not a great deal.

“We never saw a cent,” said Cindy Alter, lead vocalist for legendary local band Clout. “Private islands? No, we got screwed right out of all the money.”

Clout released its single Substitute in January 1978, but sing the start of the chorus (“If she doesn’t come baaaaack”) and many South Africans, Europeans and New Zealanders born long after that will almost involuntarily reply: “I’ll be your substitute … Whenever you want me, woo hoo.”

The single sold more than 12-million copies. The song topped the charts in countries from Sweden to Australia, reached number two in the United Kingdom and was ridiculously overplayed in South Africa. And it is apparently immortal. Listen to any golden-oldies radio show for long enough and you will hear it played.

But its popularity had more to do with Clout’s performance – and perhaps that of the session musicians who played all the instruments – than with the song as such. After all, when better-known Righteous Brothers first released it as a single three years before, it did nothing much. And when Gloria Gaynor released it as a single shortly after Clout, buyers were outraged that a “better” song, I Will Survive, had been added as the B-side of the record. Later pressings had that order reversed.

Thanks to what Alter describes as “rather creative accounting”, the band did not see a cut of the record sales. Live gigs did pay some bills, but the song’s wild popularity did little for those doing the singing and playing because there was no performance airplay royalty in place.

When Alter hears Substitute on the radio as she sits in traffic on her way to a casino gig, one of her regular sources of income these days, she gets little more than a sense of accomplishment. No royalties accrue on the song and even if Sampra wins back-dated royalties from 2002, it will not be worth a great deal to her.

“Most of my major radio play was well before then,” she said. “The best we can hope for now is that other artists will be taken care of in future.” – 

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Phillip De Wet
Guest Author

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