Writing as someone who derives most of my income from performance and
broadcast royalties via collection societies in the UK and elsewhere,
I feel that I must send this posting in an attempt to correct a few
misconceptions in some earlier postings, and in an attempt to clarify
an admittedly confusing situation.

There are two main types of royalty payable to composers, lyricists
and publishers of music:


* Performing rights: These are generated by performances of music,
whether live or broadcast.  Performances in concert halls are covered
by this, as are television or radio broadcasts, including for example
where a radio is being played in a barbershop or restaurant, and also
the emerging digital media as exemplified by YouTube.  The performance
can be live, or can be a performance of something previously recorded
(as would for example be the case with most radio or TV broadcasts).

These rights are payable for every public performance and would be
owed to the composer, lyricist (if the piece has words) and the
publisher, in varying proportions.  These rights would be collected by
a society such as the PRS (Performing Right Society) in the UK or ASCAP
(Association of Composers, Authors and Publishers) in the US., assuming
that the beneficiaries or their descendants are members (otherwise the
royalties go into limbo or are distributed amongst the other members,
if unclaimed).  The level of the royalty is determined by the length
of the music and the rating of the concert hall or broadcast channel;
These ratings are subject to annual revision.


* Mechanical Royalties: These are generated at first point of sale on
recorded forms of music e.g. CDs, DVDs of films or TV programmes, piano
rolls etc. and may well represent the composer's only source of income
for that particular product.  There is no mechanical royalty payable
on resale of second-hand goods.  Roll collectors will be familiar with
the stamps on old rolls, which represented proof of payment of the
mechanical royalty.

In the UK, these royalties are collected by the MCPS (Mechanical
Copyright Protection Society).  The MCPS formerly consisted of several
independent bodies, the stamp of one of which, Mecolico, appears on
many old dance music rolls in the UK.  These royalties are individually
negotiated whenever a new product, be it a CD, DVD or whatever, is
launched, but typically represent about 4 percent to 10 percent of the
gross retail price, divided between the interested parties.


These royalties are the payments to the copyright holders only and
should not be confused with any payments made to the performer(s),
which will have been the subject of separate negotiation.  Royalties
for performances of dramatic works ("grand rights") are likewise
subject to separate negotiation.

When you buy a new roll, the manufacturer will have (or should have)
negotiated a mechanical royalty with the MCPS (or the equivalent
society in the relevant country) if the music (or the lyrics associated
with the music) is still in copyright.  Once you have bought the roll,
you have made a one-off payment which allows you, and any subsequent
owners of the roll, to enjoy a copyrighted piece of someone else's
intellectual property in the comfort of your own home; This is how the
composer makes his living!

However, if you desire to play the roll in a commercial location,
for example your bar, barbershop, nightclub or cafe, as part of a
commercial enterprise, then (in the UK) you will have to obtain a
licence for your premises from the PRS.  You will pay a blanket fee
which allows you to play pretty much anything you desire, and the
proceeds will be divided equally between all the members of the
society.  In the past, you would have had to fill in a form detailing
every piece which was played! I am pretty sure that a similar
arrangement exists with ASCAP and BMI in the US.

The new digital platforms such as YouTube, whilst presenting many
new opportunities for the performance and dissemination (some would
say cheapening) of music, represent a challenge, or a threat, for
those of us who make our living through our intellectual copyrights.
It has been a battle for the collecting societies worldwide to get
such companies to agree to pay any royalties at all, and the fact
that they now do take this seriously is a matter for some rejoicing.
However, the flip side of this is that YouTube are anxious to be
seen to be clamping down where copyright issues are concerned, and
inevitably some innocent people will be caught in the crossfire.

Here are some important facts to bear in mind if you are posting
on YouTube:

1. Any music or lyrics still in copyright will or should accrue
a royalty for the copyright holders.

2. These copyright holders may well be faceless conglomerates, but
they might equally be elderly individuals who rely on such income
for their livelihood.

3. You are not liable for these royalties; YouTube are, and, through
their substantial advertising revenue, they have ample funds to pay
for them.  When you post on YouTube, you are theoretically enabling
YouTube to generate more income through advertising.

4. YouTube consider that it is the responsibility of the copyright
holder to report usage to them.  I have set up Google Alerts for
anything of mine which I feel might find its way onto YouTube; I then
report usage either directly to YouTube (for self-published work) or
via the relevant publisher.  If music has been parodied or is deemed
to be offensive, then my publisher will ask YouTube to remove it.
(This has happened, on a couple of occasions, where a kid's TV theme
has been uploaded in an 'adult' version.  Amusing perhaps, but
inappropriate.)

5. The monetary amounts involved are usually tiny.  I myself have had
more than 3 million hits on YouTube for various pieces of music which
I own, over more than 80 videos, one of which has had well over
1,000,000 hits.  My income from this so far?  Around $50!

The societies which collect both performance royalties and mechanical
royalties around the world mostly have reciprocal arrangements which
ensure that the monies eventually get to the right person, in the right
country.

There are however some notable exceptions to this, for example China.
The Chinese have no notion of intellectual property, as all created
art, even commercial art, is deemed to belong equally to all.  Just how
they adapt to Western thinking or, more likely, how the West adapts to
the Chinese point of view, will be a challenge for us all over the
decades to come.

It seems certain, however, that it will become increasingly difficult
for those of us who rely on our intellectual properties for our income
and I would ask all of you to give us a thought in your dealings with
YouTube.

Rowland Lee
Lincolnshire, UK
http://www.rowlandlee.com/