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News May 29, 2023

APRA Proposes New Split For Live Distributions: Exclusive

Senior Journalist, B2B
APRA Proposes New Split For Live Distributions: Exclusive

APRA is proposing a new distribution practice for promoted concerts, which would lift the rate of royalties passed on to the headliner, and reduce the cut earned by the support acts.

In an email to members, seen by The Music Network, the organisation is switching to a new 80/20 split in favour of the headliner, for those concerts in Australia and New Zealand that are licensed by APRA.

The new arrangement has been approved by the APRA board, and will come into effect with the November royalty distribution. 

Currently, the split is roughly 66/33 in favour of the headline act vs. support act — although those guidelines aren’t carved in concrete. In scenarios with multiple support acts and various other situations, the splits can shift.

These performing rights payments are a cornerstone of APRA’s activities. APRA pays royalties from live performances to its members through collections from license fees paid by promoters.

The process for determining the payouts is based on “equal weighting,” where each song performed at a concert receives an equal share of revenue — whether it’s a 60-second power punk track or a 10-minute prog-rock epic.

However, reads a message from APRA to members, the practice has come under question from both local and international headlining artists, their management and societies as it’s plausible (in some circumstances) for the headline act to receive less than 50% of the royalties.

Also, based on the current model, it’s impossible to predict the likely payouts prior to the show. 

Reps for APRA point out its system “is inconsistent” with the split applied by international affiliate societies where the “overwhelming majority” of performing right organisations distribute on a basis of 90/10, based on the assumption that the vast majority of punters in the room are there to see the top billed performer, and not the curtain raisers.

It’s good to be the headliner – outside of ANZ, at least.

The current situation creates something of a double standard, APRA claims, and the organisation has apparently been called out.

Those international affiliates have “questioned” APRA on why homegrown stars from the land Down Under — think Tame Impala, DMA’S, King Gizzard and the Lizard Wizard, and Gang of Youths — can score the big wedge when headlining dates abroad, but the same rules don’t apply when, say, a top British and American act tours these parts.

“This raises concerns around our obligations under CISAC rules for equal treatment of works,” reads the message to APRA members.

Despite the gloom spread by the pandemic, APRA AMCOS reported all-time high revenues and distributions to members in its most recent-full year report.

Public performance collections — APRA AMCOS’ oldest business — were up by 23.2% to $77.5 million for APRA AMCOS’ 2021-22 financial period.

Currently, APRA AMCOS boasts more than 115,000 members. 

The “biggest threat we now face comes from our international affiliates, who are now able to license outside of their home territories, which puts us in a competitive market for live performance licensing,” reads the message.

The U.K.’s PRS, in one example, could license direct of behalf of one of its local acts and favor the splits based on its current system, 8:2, benefiting the headliner, notes APRA reps.

Additionally, wrangling with promoters to agree to pay a license fee to APRA for the support act “may be challenging,” and the instances where a licence back is being considered is said to be “increasing.”

“Our main goal is to ensure we can compete with the ever-growing threat of direct licensing form outside sources and by doing so, preserver royalties for our local support acts, and ensure fair treatment for AU/NZ writers and artists,” reads the message, which asks members for feedback and insights.

“We also want to ensure we are meeting our obligations set by CISAC and encouraging mor headlining international artists to tour across Australia and New Zealand.”

One artist manager who spoke with TMN said the changes meant a “massive difference” in the performance royalties generated by Aussie support acts. 

In a statement posted to the official APRA AMCOS website, head of membership Alison Wright explains, “our main goal has been to retain revenue and preserve royalties in Australia and New Zealand for local artists by reducing the incentive for direct licensing. Direct licensing can occur when an affiliate society opts to enter a direct agreement with the promoter on behalf of their songwriter members.”

APRA is “now working to communicate” with members and their managers to explain the development and “work through any questions in this process,” reads a statement.

Wright continues, “we recognise that Australian and New Zealand support acts have benefited from our previous approach to royalty splits and it has been important to balance this change against the approach taken by other collecting societies. Our discussions with members have been constructive with many understanding the rationale for the change.”

The changes do not apply to music festivals that APRA licenses.

Read more here

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