From Punjab to Tamil Nadu, music labels are up in arms against the anti-competitive behaviour of the country’s only registered copyright society for ‘sound recordings’ – Phonographic Performance Ltd (PPL). As explained earlier on this blog, PPL is controlled by a coterie of the seven biggest music labels – (i) Virgin-EMI (ii) Universal (iii) Tips (iv) Sony (v) Saregama (vi) Aditya (vii) Venus – all of whose representatives are in control of the Board of Directors of PPL. Any complaint against PPL can be presumed to be a complaint against these seven music companies which control PPL.
[Clarification: None of these complaints have been filed with the CCI or the Registrar of Copyrights. These are merely complaints that have been publicly aired to the media]
(a) The first complaint – ‘Catrack Entertainment Pvt. Ltd.’
The first complaint is from ‘Catrack Entertainment Pvt. Ltd.’, a music label based out of Chandigarh. Gaurav Trehan, Director at Catrack has complained that PPL is insisting that its members, licence to it, the right to collect performance royalties for all royalty streams despite the fact that some labels do not want to licence over to PPL the right to collect royalties for the mobile ringtone and digital streams. Technically, under the law, a member of PPL can choose to selectively licence only certain rights to PPL i.e. while a label can licence to PPL the right to collect royalties for public performance in hotels and restaurants, the same label can choose not to licence the ringtone royalty rights for the very same sound-recording.
There are three specific issues with regard to this complaint by Trehan:
(i) Do the bye-laws of PPL require all its members to assign over to it all rights in a sound-track or can members decide the specific nature of the rights which are licensed over to PPL? To the best of my information PPL does not have any bye-law which imposes any such restrictions on the nature of rights which may be licensed to PPL by its members. In such a case it is possible to request the Registrar of Copyrights to cancel the registration of PPL as a Copyright Society.
(ii) Is PPL using its ‘dominant position’, in the music industry, to force its member companies, to licence to itself, even mobile and digital streams of exploitation? The fact that PPL has a ‘dominant position’ in the music industry is undisputed since it is the only registered copyright society for the administration of sound recordings. The condition of bundling ‘mobile & digital streams’, with public performance royalties from other ‘streams’, severely and unfairly restricts the rights of the members to choose the most competitive mode of exploitation of their works. There is simply no logical reason for insisting on the bundling of such rights.
(iii) Alternatively, it is possible for members of PPL to level charges of cartelization amongst the seven music labels which control the board and administration of PPL. In such a case any penalty by the CCI would be against these seven music labels and not PPL.
(b) The second complaint – ‘South Indian Music Companies Association’ (SIMCA)
Anita Iyer, a journalist with ‘Sound-Box’, has carried an interesting story (it can be accessed over here) on how members of the South Indian Music Companies Association (SIMCA) have publicly alleged that PPL is denying membership to South Indian music companies on the frivolous grounds. For its part, PPL has defended its actions on the grounds that these South Indian Music Companies have failed to fulfil the eligibility criteria for membership of PPL. In pertinent part, PPL informed these music companies that the eligibility criteria for ‘Associate Members’ of PPL was at least 50 music albums and that cover version albums, classical and devotional albums are not counted for this purpose. This would mean that only ‘film music’ is being recognized by PPL for its eligibility criteria. PPL’s registration certificate however states that it is required to administer all sound-recording. There is no distinction between ‘film’ and ‘non-film’ music.
I have managed to dig out the qualification criteria as laid out in PPL’s ‘Articles of Association’ (AoA) which can be accessed over here. The term ‘Associate Member’ is defined as “An Owner of Sound Recording Copyright or Owner of Reproduction of Recording rights and Musical & Literary Works, who has registered with the company, at least one work in his /its name, and as recorded in the Register of Works maintained, and any person who holds right of administration of copyrights for and on behalf of and at behest of the Copyright Owner, shall only be admitted as an Associate Member of the company.” This definition clearly does not distinguish between owners of ‘film’ music and ‘non-film’ music. Unless this definition has been amended, PPL cannot deny membership to the South Indian music labels. In case this definition has been amended, PPL will also have to establish that the new definition has been approved by the Copyright Office.
Irrespective of the definitions contained in the AoA, it is also possible for members of SIMCA to file a complaint against the cartel of seven companies controlling PPL on the grounds that they are attempting to push out potential competition from the new labels.
Prashant,
I remember of a case going on in Delhi High Court, (I do not remember whether it was PPL or IPRS) where perhaps there was no ex pate ad interim injunction against the defendant (normally there has been ex parte ad interim injunctions in favour of PPL/IPRS) and the counsel for defendant was showing the dictatorial attitudes of the society where his client was compelled to buy license of the type that was offered by the society and not at the choice of the defendant. The defendant was contending that he does not nee the say 50 songs which are offered by plaintiff and charging an X amount. He said that he only wants 10 songs and wants to pay for those songs and that the plaintiff should disclose how much was the license fee payable for each of the songs and that he will then choose further songs of his choice and pay for it. He was not willing to pay for the song he did not want it and was feeling to have been forced for it. The counsel for plaintiff was not agreeing for it and had stated that his client has standard licenses and that the defendant had to choose from those standard licenses and that defendant cannot be chooser.
I did not follow up the case further. Hence I am unable to give further details. However, once thing is clear that these societies practice dictatorial attitudes. The greatest problem is that in violation of a copyright a man can be arrested. The societies take the undue benefit of that.
do you have any idea how to purchase ppl licence. I have been searching alot for the same