The Australasian Performing Right Association (APRA) is a copyright collective representing Australian and New Zealand composers, lyricists, and music publishers. Sam Smith spoke with NZ’s head of APRA, Anthony Healey, about his role in the organisation, royalty collection in 2018 and issues around paying musicians.
I am a lawyer by trade and about 20 years ago I started acting on APRA’s behalf as a lawyer. APRA at the time needed a greater appreciation of their business from a legal perspective and I came in and I started acting for APRA in NZ as a lawyer, and then really just got more and more involved to the point that I became an in-house legal counsel. I then started running their licensing business and then one day Mike Chunn, who was the head of APRA at the time, decided to move on and I took over.
APRA here in NZ are a part of a much larger ecosystem in the Australasian organisation and we are a microcosm of the bigger organisation so everything that happens in Australia happens here.
Now I lead a team of about 32 people and, you know, things have just grown exponentially lately. When I started at APRA, I think we were collecting maybe $6 or 7 million a year in NZ and last year we collected an excess of $50M. So things have grown quite dramatically over that time. Now my role isn’t so directly concerned with the legal side of our business, or indeed the licensing side of our business, but I just kind of run a team of people that have direct responsibility for all of those areas, including the most important part of our business which is looking after our members.
At its very essence, our core role is to administer the rights of our songwriter and publisher members. So we collect royalties, we collect information about what music is used and we distribute those royalties to those writers and to those publishers. And around that obviously because we are a member organisation, we have other roles as well so it grows into a role of advocacy and representation, but in essence, we are a collecting society and we are administering rights on behalf of our members.
It’s a complex beast these days and there are numerous revenue streams. Our role is that wherever music is used we must be standing there going, ‘Hey the music writer needs to be paid.’ So part of that is developing licensing schemes that are fit for the purpose of the music that is being used. So, however people are using music we have got to be there to develop license schemes, to license the music, to make it available and to return the royalties that we collect to the music writers. How it works? I mean it is complex, there are everything from very small licenses that we offer for music at a café, or a retailer, right up to the other end of the scale in terms of licensing Spotify who these days would be our biggest digital customer.
We work really hard at trying to do two things, I guess. One is maintaining a database of who owns what music. So we need to know who owns every song and then at the other end of the scale, we need to know what music is being used out there so we can match those two things up. When we receive the information about what music is being played, we can match it up with our database of who wrote which song. But yeah there are times when you can’t identify the owners of a song or you can’t identify what song is being played and so there are times in which our distribution isn’t 100% accurate. But we do try, I mean obviously we spend a lot of time, effort, and money ensuring that the distribution is as accurate as possible.
Yeah. So if you understand the difference between those two things; copyright exists within a song and copyright exists in a recording. Generally, a songwriter owns the song, the musical work, and the owner of the recording historically and most commonly has been the record label – so the record labels have a separate copyright. When you play a piece of recorded music in public there are two copyrights that you need and therefore two licenses.
In the past a café or a shop that is playing music in public needed those two licenses and had to go to two different places to get them, one was to APRA and one was to PPNZ. We thought that could be improved so PPNZ and APRA came together and we now have one licensing operation called OneMusic. OneMusic is operated from within APRA, so do we collect on behalf of record labels and recording artists? Yes, we do. In certain instances, we don’t for broadcast or for streaming services, but we do for public performance and we do that because it is simpler and it is easier to combine and to make a product for the end user that is 100% rather than 50%.
We negotiate license streams with those streaming services. We drive as hard a bargain as we can to ensure that a greater slice of the pie is being delivered back to songwriters. We are able in the case at least of the music streaming services, to distribute those royalties accurately because those services can provide us with the streaming data of the music that is streamed. So we can match that up to our database and we can identify the writers.
But the volume of data these days that we are having to process and analyse is just enormous, so enormous that our system right now is struggling to cope with it and we are having to rebuild our entire IT system that underpins everything that we do, and that is a massive job. But currently, the streaming services provide us with the information that we need from them and we can identify the songs and the writers and divvy up the royalties that we collect.
The way that streaming works now is the equation looks something like our license fee is on or around 15% of the streaming services’ income, the record label’s license fee is somewhere between 50 and 60% and the rest is Spotify’s income. So that is kind of the equation and within that, there is just a whole lot of work to make sure that the writers get their share.
No, I don’t see many musicians being able to make a good living off their music. Given the incredible value that music has to society I don’t think that is right and just. We are always arguing that the writers share should be much greater and more money should be returned to those people who are creating the songs and I don’t see it at the moment. It is unfair and you see these enormous technology companies building trillion-dollar businesses on the back of music and on the back of the people who write the music, but the people who write the music are not being compensated well enough.
Well, there is a lot of talk about the inequity, especially in the case of video on demand services, let’s say YouTube for instance, where the returns to copyright owners are disproportionately low. When we sit down with these companies to negotiate licenses we struggle to negotiate licenses on an even playing field because the services will often throw back at us various exceptions that exist for service providers such as YouTube. And that is complicated, it is a complicated piece of copyright legislation, but it is commonly referred to as the value gap. So the gap between the value of what is streaming along that service and what that service ultimately becomes worth.
The future of music is quite plainly a digital future. The collective nature of an organisation like APRA and the service that they will provide to both music writers and services that need to use music and access music legally, the collective nature of what we do will become more and more important. Our challenge is to make sure that the licenses that we negotiate and the revenue that we collect on behalf of our members is fair and reasonable and represents the value of music to those services. And I think in the future that is going to be more and more important.
