In brief

The Australian Federal Court recently found that the simultaneous transmission of a radio program using FM transmitters and web stream servers via the internet falls under the Phonographic Performance Company of Australia’s existing licence arrangements. As a result, musicians and record companies will not be able to recover additional royalties for music streamed online as part of a radio program.

How was the decision played out?

The Phonographic Performance Company of Australia (PPCA), the collecting society representing artists and record companies, sought a declaration that its licence to commercial radio stations for the broadcast of certain sound recordings did not cover internet rights.1 This would have meant the PPCA could require radio stations to pay separate royalties for streaming music on the internet. 

The Industry Agreement, dated 16 June 2000, and Member Agreement, under which the relevant licences are granted, expressly link the definition of ‘broadcast’ with the meaning of that term under the Copyright Act (which in turn refers to the definition of ‘broadcasting service’ under the Broadcasting Services Act).  

After considering the technology to deliver the FM and internet broadcasts, the court dismissed the PPCA’s claim and found:

  • the ‘service’ which transmits the same radio programs at essentially the same time to the FM transmitters, web stream servers and beyond is ‘one service’,
  • the service combines various platforms or delivery methods and delivers the same radio program using the broadcasting services band,
  • the internet is used for only part of the transmission, and
  • the simulcast transmission of the same radio program over FM waves and the internet constitutes a ‘broadcast’ within the scope of the PPCA licensed rights. 

A radio program delivered entirely over the internet would not fall within the PPCA licence.

The decision has significant implications for musicians and record companies. It means that the same royalty payments under existing licences will cover traditional broadcasts as well as music streamed online as part of a radio program.

Does your contract deal with digital rights and royalties?

This case highlights the importance for content owners to consider:

  • separately dealing with their digital rights, and
  • seeking separate rights for different media platforms or separate royalty payments for different media. 

Where an agreement deals with media and digital rights in vague terms, perhaps in an attempt to match the uncertain and fluid nature of technological frameworks, there is a risk it could cut across future royalty payments.