It is difficult to imagine an issue in the performing rights world that has generated more controversy and confusion than the idea of “Straight Payment.” Under this concept, all genres and forms of music are valued the same: songs, theme, score, promos/logos, and music for advertising are all paid at the same rate. Straight Payment should not be confused with different rates that would be established based on the size of the broadcaster (local vs. network), time of day, and other overall market factors. But under this concept there would be no special rates or penalties for any types, genres, or usages of music during the same time period. The first implementation of this concept came in 1998 when the English performing rights organization PRS adopted Straight Payment, known in England as “straight-line distribution.”
While the world watches and waits to see what the affects of this are for composers and songwriters, we’ve asked two industry professionals to express their viewpoints on the issue of Straight Payment. We appreciate the time and effort that composers Les Hurdle and Garry Schyman took to so eloquently express their viewpoints on this important issue, and we hope you’ll benefit from their points of view.
Les Hurdle is a member of the American Alliance of Composer Organizations and is a composer of songs and instrumental music.
Garry Schyman is a film and television composer and is co-chair of the Performing Rights Committee and incoming Vice President of The Society of Composers and Lyricists.
Straight Payment: Fairness, Equality, and an End to Discrimination
By Les Hurdle
Straight Payment is a method which could readily be employed by US Performing Rights Organizations (PROs) whereby all genres of music would be treated fairly and paid the exact same amount via calculations based purely on airtime. To me, this method means an end to discrimination and a beginning to fairness. After all, what business does a PRO have determining arbitrarily and politically whose music is worth more than others? It’s time for fairness and equality.
PRS, the English PRO, has recognized the absurdity of weighting formulae and differentials, switching to Straight Payment after a government body (the Monopolies and Mergers Commission) deemed that using weighting formulas was discriminatory. As a high ranking PRS official noted, “The very simple truth is the PRS board decided that it had no right to make value judgments on music and has taken the kinks out of the distribution system.”
In the early days of Radio and TV, culturally and politically the “song” was the “currency.” Not so today. Percentages of music used in the average TV or film program, when examined via industry experts, indicate the following; 90% score, 7% song, 3% theme. However PRO distribution formulas and payment values do not mirror this usage.
Payment differentials were highlighted in a recent NY Times article featuring jingle king Stephen Karmen. It was noted that a Cole Porter song used at a televised award ceremony would earn $1,250 for the writer and publisher whereas a jingle for a television advertisement, which helped pay for the extravaganza, would only earn the recipients $37.50 each. ASCAP rules promote a massive difference in the weighted value of a jingle (3%) to a Feature Performance (100%) (usually a song). Themes and score also find themselves placed at the lower end of the weighting/income spectrum. I am not privy to BMI/SESAC score weightings.
Should the PROs appoint themselves as judge and jury when it comes to the “value” of people’s music when redistributing millions of dollars of license fees paid to us by the broadcasters for our music, why should one genre or usage of music be discriminated over another? Where should one draw the line? Should there even be any “differentials” which create haves and have-nots when our money is distributed? Many would say “No!” Songs are not “born” with any special differential attached to them.
There is one very important fact that you should remember in all of this. The broadcasters pay ASCAP and BMI the same amount to broadcast a song as they do to broadcast themes, score or music for advertising. These types of music are paid at the same rate by broadcasters. However, current “weighting” rules at ASCAP can create a 3,300% difference (Feature Performance vs. Music for Advertising) in how these license fees are distributed to composers and songwriters. In order to attempt to calculate Straight Payment in the USA for this editorial, US PROs were asked, via various methods, to provide data regarding the percentages of distributable income paid out to bumps, bonuses, guaranteed payments, seniority and 4 Fund schemes etc. All requests for this information were either declined or ignored by the PROs.
Beyond all of the speculation and ballyhoo about Straight Payment are the facts. I can attest (as an ASCAP/PRS member) that my UK “score type” income from PRS increased by over 30% via the first Straight Payment by PRS in 1998. This increase may not be typical of all PRS members, in fact some enjoyed a much larger increase. The prediction for writers in the US is equally encouraging.
One must question the rational of anyone who would not want to see a system that promotes fairness and equality for all composers and songwriters! If composers (especially elected officials) cannot treat the talents of their fellows with equality, fairness and respect, why should others, such as restaurant owners?
The three US Performing Rights Organizations are faced with a very difficult task. None of them are able to track members’ product accurately or pay members correctly at this time. Technology is racing ahead, but the PROs appear uninterested in taking advantage of the technology (such as digital watermarking) that would allow them to pay for what is actually on the air today and eliminate their self-pronounced, antiquated “survey” system. Composers both here and overseas are becoming increasingly aware they are not being paid for much of what is on the air in the US, and are examining alternatives to fight this discrimination. Now we hear that major television shows are starting to use Direct Licensing to compensate composers and songwriters directly for the use of their works, completely bypassing the PROs, thereby leaving composers vulnerable.
The US PROs have the opportunity to preserve what they’ve built over much of this century where composers, songwriters and publishers could benefit every day if the PROs did one simple thing: paid people for what’s on the air at fair, non-discriminatory rates. Just as PRS did in England, it’s time to end the discrimination and for us to stop devaluing each other’s music. Straight Payment: simple, fair and economical.
Straight Payment from a Film and Television Composer’s POV
By Garry Schyman
Performing rights are the backbone of a film and television composer’s income. Therefore, any radical change to the current system needs to be carefully examined before being embarked upon. Let me state up front that I am a film and television composer and I come to this issue from what I believe is in the best interest of my community. The argument for “straight payment” comes from library and CPA (commercial promo and announcements) composers for good reason-they will benefit enormously from the change. ASCAP and BMI distribute pools of money and cannot arbitrarily raise the fees they collect from broadcasters. Therefore, the money to increase payments to library/CPA composers will have to come from somebody, and that money will come from film and TV composers as well as songwriters (often film/TV composers).
The library/CPA community of composers has a perfect right to lobby the performing rights societies for more money. It is also the right of film and television composers to resist these changes if we feel they are detrimental to us. The argument for “straight payment” is often wrapped in the cellophane of “fairness” and “doing the right thing” for all composers. Yet, does anyone seriously think that they would be making the same passionate arguments if it meant smaller checks for them?
How music is used, its length, and the time of day it is broadcast value music on any one station or network. How the music is used is the primary discussion here, and I need to begin by briefly describing the various categories of music and how they are valued. Feature performances (FP’s) are works (usually songs with vocals) that are paid a premium by the societies. They are commonly the focus of audience attention and are paid this premium on the theory that this music is the primary entertainment value at the moment they are broadcast. A full feature performance must be 45 seconds or longer (shorter FP’s pay less) and do not increase in value as they continue. A :45 or longer FP on network prime time could be worth between $1400 and $1,800 depending on other variables. Other categories of music are valued by their length and/or as a percentage of a full feature performance.
What would happen if all music were valued equally by length? Let’s examine a theoretical one-hour television drama on a major network during prime time. If that drama has a theme and twenty minutes of background music the composer might receive (assuming he/she wrote all the music) as much as $4,200. If there are fifteen minutes of commercials and promo music during the same hour, those composers might divide up approximately $800. Now lets say, for the sake of argument, that the entire hour is worth $5,000 in performance royalties. What would happen if all this music were valued equally? The series composer would now receive $3,400 or a 19% decrease in payment. The CPA composers would divide up $1,600 or an increase of 100%. These numbers are approximate, but they do represent what would happen under a straight payment scheme.
Two arguments dissuade me from seeing this as fair. First, viewers tune in to watch a television show and not the commercials and promos. Would people watch a show without commercial interruption? Yes! Would they tune in for an hour of promos and commercials? I don’t think so! Second, the CPA composer’s music is written once and usually plays over and over again. It may play dozens of times during the broadcast day and continue to be performed for weeks or months. On the other hand the background composer’s music gets one or two (with reruns) prime time performances. This means that the a CPA composer could receive many times what a background composer receives for a similar length of music. The TV and film composer brings dramatic value to a show and therefore value to the network by increasing the audience. That is why broadcasters pay for our music.
Ironically, straight payment could actually end up hurting CPA composers by giving broadcasters an incentive to demand performing rights buyouts from them in order to make a per-program license more attractive.
One of the major arguments that CPA and library composers make to attract background composers to their point of view is that if we eliminate feature performances we will all make more money dividing up the spoils. Besides the fact that this would put many film and television songwriters and lyricists out of business, and leaving aside the creative argument that songs, especially big hits, often bring a unique and powerful element to the film or TV show (why do you think production companies pay so much for those sync licenses), what might occur if FP’s were eliminated is very difficult to calculate precisely. However, it is estimated that if feature performances were completely eliminated this would add only a few percentage points to the average background composer’s quarterly statement. If you take into account that many film/TV composers are also songwriters and own a number of feature performances it is most likely a wash for most of us. However, if the straight payment scheme is fully implemented, we (film and TV composers) could see dramatically smaller checks (see paragraph 4).
Bottom line: film and television composers will pay the bill for dramatically increased payments to CPA and library composers if the straight payment scheme is implemented, and from my point of view that isn’t fair!