Over the last few years, artists have become more aware about their right to royalties. In our earlier article we explained about how the lack of music publishing knowledge is robbing artists of their royalties. In India, the Indian Performance Rights Society (IPRS), is the sole authorised body to issue licences for usage of musical works and literary music. It collects royalties from music users, for and on behalf of IPRS’ members i.e. authors, composers and publishers of music. Royalty collected is distributed amongst members after deducting IPRS’ administrative costs.
To gain an insight about the functioning of IPRS and address concerns that the artists might have, we spoke to Rakesh Nigam, CEO, IPRS.
Please explain the functioning of IPRS
People are blissfully unaware about what IPRS is, its role and how it functions. They think IPRS functions the way it wants, pays ad-hoc royalty but it is not true. We follow a laid down system, distribution policy, which the members approve of in the Annual General Meeting (AGM) and it keeps changing yearly. It does not run like a propriety firm. If the song is played and we get logs for it, the member gets paid. India is not a compliant country and we have our limitations. We have only 90 officers across the country. Those who use music also have to be compliant. They have to pay the royalties and provide us with the set list of the songs played. Otherwise how will we know whom to distribute the royalty?
For the artists to receive royalty, he/she has to become a member and meet all the criteria. They need to update their new works with us. If the artist is performing, he/she needs to provide us with the set list and the logs so that the royalties can be distributed accordingly. Else the royalty gets summed up in the larger distribution scheme which is based on a formula approved by the members. Whereas if the set list is provided for the performance, the royalty is given only to those songs. It becomes very difficult to track the songs played from the non-film sector. We require the support of both the film music and non-film music artists.
What role does a member play?
We remind our members during the AGM that their role does not end by just becoming a member. We can be as good as the information you provide to us. How are we supposed to know the names of the lyricist or composer of a new song? If you do not submit your work, proof of it being your work, the names of the author, composer, publisher how do we register that work? If an artist’s work is not registered with us, we cannot pay royalty.
For any clarifications they can visit IPRS and talk to us. Earlier we were based only in Mumbai but now we have offices in Chennai, Kolkata and Delhi too. There is a structured online format also to register your work. They can mail us all the relevant details of their work on an excel spreadsheet. So we can verify it before we register it.
What are the steps that IPRS has taken to simplify the registration process?
In the last 2-3 years, we have simplified the registration process. One can submit their work along with the proofs online. If it matches our requirements we send them an assignment deed for their signature. Assignment deed is primary for any member. The website has all the relevant details about submitting the work. They can download the forms and mail us a copy filled with the details about their work. The artist needs to know if the music company and the publisher are members of IPRS, which requires a separate membership. They should provide us with this information so that we can claim 100% royalty for that song. If the owner of the song i.e the music company or the publisher, is not our member we cannot claim royalty.
How is the royalty distributed?
IPRS and the digital platforms
The online platforms work very differently from each other. YouTube pays as per the advertising revenue generated and not views. With Apple and Spotify this is not the case. Unfortunately the major platforms have a huge free user base. If these users paid even Rs. 30-40 a month, imagine how big the industry would become and if even 50% of the revenue comes back to the music industry it would be huge.
How does ‘retail licensing’ work?
Retail licensing is called as ‘ground public performance event’. We have simplified, rationalised and even reduced our tariffs for retail shops and made the process quite simple. The tariff chart is available on our website. They can also obtain a license online through our website. Once you enter the details of your establishment, the royalty is calculated as per the details. Once you pay the royalty the license is generated. We mail the license along with a GST invoice within a few days of the registration.
How are you upgrading IPRS and what seems to be its future?
CISAC has helped us streamline things. It helped us to get into the distribution policies, rationalisation of tariffs, to get our articles as per their guidelines. This process started a year before CISAC restored our membership. We have signed reciprocal agreement and are handling their digital rights. IPRS has signed with Datacleft which is one of the most advanced system for data processing, distribution and identification.
After 5 years we should be a Rs 500 crore company at the least. If things go as planned, then maybe even Rs 1000 crore plus.