Image from here.
(i) Phonographic Performance Ltd (PPL) Reports for 2005-06, which was already given to us the last time; available over here – Part I; Part II:
(ii) PPL Reports for 2008-09; available over here – Part I; Part II;
(iii) IPRS Annual Report for 2006-07;
(iv) IPRS Annual Report for 2009-10;
We are therefore yet to get the following Annual Reports:
(i) PPL’s Annual Reports for the years 2006-07, 2007-08 and 2009-10
(ii) IPRS’s Annual Reports for the year 2005-06.
This probably involves another set of appeals but now that we’ve got the ball rolling, I’m sure it will be much easier.
(i) ‘Numbers talk’ – A look at the phenomenal growth in PPL’s revenues
In an earlier post we had discussed PPL’s revenues in 2005-06. In that year PPL had earned approximately Rs. 30.27 crores. This in itself was a jump of approximately 56% and revenue from mobile phones contributed to 58% of the total revenue at Rs. 13.97 crores.
Fast-forward to 2008-09 and we witness a spectacular rise in the actual revenue of PPL and although this rise is concentrated in the sector of mobile phone, other areas contributed more than their healthy share. And oh yeah – this was a year of economic recession!
The total revenues for 2008-09 stand at a stunning Rs. 137.29 crores (i.e. approx. USD 35 Milllion) i.e. an increase of Rs. 100 crores or a 400% growth in just 3 years and PPL estimates that it revenues for 2009-2010 would be an estimated Rs. 165 crores.
Of the Rs. 137.29 crores that PPL earned in 2008-09, a stunning Rs. 99.13 crores (42% increase) was just from mobile and digital streaming. Another Rs. 22.12 crores was earned by PPL by way of public performance (30% increase) i.e. through public events, restaurants, pubs, hotels etc. I couldn’t find the figures for Radio stations but I’m guessing that no money is going to exchange hands until a final verdict.
But getting back to the highlight of the Report – almost Rs. 100 crores from just mobile ringtones and web streaming! No wonder Javed Akhtar pushed so hard for the amendments to the Copyright Act. One of the main amendments is targeted at voiding those assignment deeds in which composers and lyricists have assigned away their rights in all future modes of exploitation, such as on the internet and ringtones. Basically this means that the lyricists and composers do not get a pie of Rs. 100 crores. The more pertinent question over here is whether they are even aware of these figures while entering into contracts for their standard one time lump-sum payment with no further royalties. Knowledge of these mind-boggling figures will result in a lot of them revising their contracts. The proposed amendments aim at voiding all such contracts and ensuring that lyricists and composers not only retain their copyrights but are also entitled to receive equal share of royalties earned.
(ii) Transparency in Tariff Scheme: In the last Annual Report for PPL, provided to us, we were unable to trace the Tariff Scheme that is required to be submitted under Rule 14P. The 2008-09 annual report however was significantly better as it provides for an extremely detailed ‘Tariff Scheme’ for all kinds of licences issued by PPL. I have really not seen anything as detailed as this list. Prima facie the rates look quite reasonable, it’s of course a completely different issue as to whether PPL actually follows this tariff scheme. Some of the licences are however of doubtful legality for e.g. 33(e) lists the licences available for college festivals. Theoretically, Section 52 of the Copyright Act, 1957 which covers ‘fair use’ exempts all educational institutions from the Copyright Act. Interestingly PPL also charges for charitable functions! The question that is begging to be asked over here is, why doesn’t PPL put up this list on its website? What does it have to hide? Because we are anyway going to host it on the SpicyIP website. And besides I’m sure even the Copyright Office will start to host the annual reports on its website.
(iii) The mystery of international remuneration: One of the long enduring mysteries about PPL is whether it actually remunerates royalties to its alleged foreign affiliates because it is definitely collecting money from people in India for foreign recordings. Well this report does shine a little light, although it’s more in the nature of a little ray of light. On page 5, of Part II, the Report shows that PPL is earning foreign revenues although the same has drastically fallen from Rs 4.2 crores in 97-08 to Rs. 878,736 in 08-09. Page 7 of Part II provides the break-up for these foreign earnings. While in 2007-08 PPL was earning Rs. 3.75 crores from radio broadcasts in foreign countries, it also earned Rs. 50.58 lakhs from mobile and digital streaming. Fast-forward to 2008-09 and PPL earned nothing in the radio broadcast category and a meagre Rs. 8 lakhs in the mobile and digital streaming category. The question therefore is why have collections from foreign radio broadcasts fallen to zero in 08-09? Was it because PPL does not remunerate royalties to foreign music holders or is it because of some other reason? The Annual Reprot does not seem to indicate that PPL is repatriating revenues to foreign copyright owners, although its tariff scheme does have a segment on international ringtones.
(iv) More litigation against PPL: In our last post we had pointed out to how PPL was being sued in the Delhi High Court with national hotel and restaurant federations challenging the constitutionality of Section 33 of the Copyright Act, 1957. Given the seemingly reasonable tariff scheme by PPL I’m not sure why these guys are going through the pains but it is interesting to note that PPL is also being sued in Rajasthan, Gujarat and Goa by national hotel and restaurant associations, all of whom are challenging provisions of the Copyright Act itself. Given the degree of litigation between PPL and hotel & restaurant associations I’m surprised that not a single one of them appeared before the Parliamentary Standing Committee on the Copyright Bill, 2010.
If any of our readers do find some additional tid-bits in the annual report please feel free to point them out to us.