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Business News/ Politics / Policy/  The copyright enforcers

The copyright enforcers

The copyright enforcers

Paying a price: Since licence fees depend upon how valuable music is to the establishment, discotheques are among the highest payersPremium

Paying a price: Since licence fees depend upon how valuable music is to the establishment, discotheques are among the highest payers

New Delhi: In a plush den, in a corner of a popular Connaught Place establishment, P.K. Gupta gamely tries to convince its owner that his restaurant is really a lounge bar.

Paying a price: Since licence fees depend upon how valuable music is to the establishment, discotheques are among the highest payers

For PPL, a copyright society representing dozens of record labels in India, this distinction is important. As a restaurant, the owner needs to pay PPL only an annual 10,000 in licence fees for the music he plays. As a lounge bar, that amount rises to 1 lakh.

The owner, who remains anonymous on PPL’s request, tries to be cocky, but his demeanour fluctuates. “You must understand, we use the console only because the music sounds better," he says. Then, self-righteously: “You guys are being monopolistic about this. We will stand firm."

Gupta murmurs something about just doing his job. This is his technique, whetted over 12 years with PPL: He’s calm, self-effacing and persistent. He insists it works. The owner now starts to wheedle. “It’s a huge jump, you know, from 10,000 to 1 lakh," he says. “If you wanted to be reasonable—maybe 15,000, or even 20,000—I’d be willing to discuss it."

For Gupta, a fee is a fee; he isn’t in a position to bargain. He placates and coos some more, and then stands up, even though the subject is nowhere close to settled: “I’ll come back another time." Outside, Gupta laughs. “This is how it goes. Nobody ever wants to pay. Many people don’t even know they’re supposed to pay." Across India, PPL deploys close to 70 copyright enforcers such as Gupta—people who visit establishments that play copyrighted music, persuading them to buy the licences stipulated by law. The revenue is, as Vipul Pradhan, PPL’s chief executive officer, admits, not large—less than $10 million (Rs 46.7 crore) last year, as compared with $905 million collected in 2009 by Broadcast Music Inc., an equivalent society in the US.

Job hazards

“But it could be enormous," Atul Churamani, a vice-president at Saregama India Ltd, says. “The difficulty is, India is a large country, and you need a massive army of people to get into every town. Even in a city like Mumbai, you need so many people. And a collecting society can’t spend more than 15% of its revenue on its costs."

For their troubles, says Pradeep Nigam, a business development manager at PPL, “We’re called extortionists and thugs." Sometimes it gets worse. In Mumbai, an enforcer was once stabbed when he visited a dance bar to collect his fees. At a Noida lounge bar, a PPL executive was beaten up by bouncers this past March. “He was so shattered," Nigam recalls. “These guys are graduates, they come in expecting white-collar jobs, and then this happens." Even Gupta, for all his calm and savvy, will admit to being “a little afraid" when he visits discos and lounge bars.

To a layman, copyright seems to be endlessly divisible. As a society, PPL was formed in 1941, a few decades before the Indian Performing Right Society (IPRS), a similar body with a different brief. PPL represents record labels; IPRS represents music publishers—who are, in Bollywood, often the film’s producers—as well as lyricists and composers. As such, each society sends into the field its own copyright warriors, to issue separate licences with separate fee structures.

PPL’s Delhi office, now on the ground floor of a bungalow in the Nizamuddin neighbourhood, was set up in 1996, two years after a Copyright Act amendment allowed societies to collect these licence fees. A couple of its executives have worked there nearly all 14 years. “Back then, it was awful—everybody would just refuse to pay," says Alakesh Majumder, who joined in 1997. “Things have certainly improved."

Breaking the law

That’s a relative evaluation. Asked if he is ever “pleasantly surprised" by proprietors paying gladly, Nigam bursts into laughter: “That’s never happened." When the Commonwealth Games Organizing Committee launched its theme song, he says, there was Bollywood music playing as a filler throughout the function. “But we’re not even able to get them to return our calls, to talk about fees," he moans. “If a government agency breaks the law like this, what can we do?"

Licence fees are pegged loosely upon how valuable the music is to the establishment; Nigam counts as many as 47 categories. For a shop, the fee is tied to its area; for a restaurant, to its seating capacity; for a disco, to the number of people swarming over its dance floors every night. The annual fee can be as low as 1,000 or as high as 3-4 lakh.

Presented with defaulters, PPL files civil cases, hoping that the courts will order establishments to not only buy a licence but also pay backdated fees. “We file 10 or 15 such cases every year, in Delhi," Nigam says. “But we can’t file against everybody. It has to be worthwhile to fight a case." Last year, out of frustration, PPL started initiating criminal charges; as permitted by the Copyright Act, police can descend upon an establishment and seize its equipment. Like similar societies abroad, PPL and IPRS use rough models to portion out their collections. “Obviously a restaurant isn’t going to give you a log of what songs it plays," Churamani says. “So each society has a model that takes into account radio play, album sales, elements like that, to decide which songs are most likely to be played in these places."

These models can drift into storms of contention. Achille Forler represents nearly 2.5 million international song titles in India—some of them by major artists like Britney Spears, Madonna and Iron Maiden. IPRS pays these artists, via Forler, a share of its revenue proportional to how often their tracks are played.

“For…unlogged royalties, IPRS uses the formula that 5% of all the music played is international, that the rest is Bollywood," Forler says. “Since my catalogue represents 30% of that international market, they’ll give me 30% of that 5%." But this is a flawed measurement, he argues. “You go into any five-star hotel, and within five minutes you’ll hear a song from my catalogue. At these hotels, 99% of the music played is international, unless you’re in an Indian restaurant. Even coffee shops play mostly international music."

Monetizing music

This gimlet-eyed focus on Bollywood music is also something that Shubha Mudgal, as a classical musician, complains about. Mudgal has heard her own music many times in commercial establishments, she says. “But I’ve never received a penny from them… They don’t care two hoots for people who aren’t in film. If at all they do contact us, it’s for tokenism."

Even within Bollywood, a vein of dissatisfaction prevails, and Forler traces this back to a 2008 dust-up, when IPRS attempted to corral artists into signing over all rights to producers, and not merely the rights to use their music in a movie soundtrack. Only in the digital age—when music can be further monetized as, for instance, mobile ringtones—has this begun to matter deeply.

Some musicians, who depended on royalty checks for a living, promptly signed the IPRS letter. (Mint has a copy of the letter.) “We refused to sign," Ehsan Noorani, part of the acclaimed Shankar-Ehsaan-Loy trio of composers, says. “So none of us—not just Shankar-Ehsaan-Loy, but a whole bunch of us—have been paid since then."

A new Bill, proposing changes to the Copyright Act, may repair this discord, although not to universal satisfaction. It would give film producers and record labels only movie soundtrack rights, leaving other rights with the creators of the music. In so doing, it would pull India into a notion of music copyright accepted in much of the rest of the world.

With Slumdog Millionaire, as a February press release from the International Confederation of Societies of Authors and Composers pointed out in a telling example, A.R. Rahman “kept the rights to his work on this UK-produced film but would not have if these very same works were included in an Indian production".

Pradhan considers the Bill’s arguments “misguided". A ringtone, he says, “is simply a snippet cut out of a master sound recording, the rights for which have already been assigned to the film producers". A 1977 Supreme Court decision seems, on its surface, to agree with Pradhan in principle—but then again, even the apex court’s wisdom could not, in 1977, have anticipated caller tunes.

Pradhan is confident that the Copyright Act amendments, once they happen, will settle this dispute one way or another. The genuinely intractable problem is still the inability of PPL and IPRS to collect all the fees that are legally theirs. “Even by a back-of-the-envelope calculation, India is about 10 times bigger than the United Kingdom, and we collect about a tenth of what their societies collect," he says. “That’s the really depressing story here."

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Published: 09 Sep 2010, 12:50 AM IST
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