So it has finally happened, PRS for music is taking on the might of SoundCloud over streaming royalties. I just had an email from PRS drop into my inbox (see below) detailing the circumstances that have arisen and let to this legal course of action. Personally speaking I think that this is a big deal for the industry as a whole, and is coming at a time when people and artists are finally getting to grasps with the new music business income streams and realising that a lot of these tech companies are actually taking the mickey a bit when it comes to payments made to content creators (this isn't exclusively a music industry problem I feel, but most of the creative arts). So it would seem that PRS for music is putting it's money where it's mouth is at and standing up for it's members (I am a member I should add!) and trying to some extent to get it's members what they are entitles to, which at the end of the day is just a fair deal.

PRS for Music, what does it do?

The way that PRS For Music works is by trying to make sure that any of it's members are paid a royalties (for the song writer writing the material, and for the sound recording) when their music is played on radio, TV, public performance etc, this is one of the only ways a writer receives income from their work, so it is crucially important, especially in the days of self-publishing. It has been reported that Soundcloud has over 175 million unique listeners a month, that is an incredible amount of listeners! But up until now Soundcloud is NOT a PRS license holder, which means any PRS member who's content is on the site is not being paid a bean when their music is streamed from Soundcloud, but for a company valued at $700 million this [*1] isn't really playing fair is it.So in the email from PRS For Music, they have said “after careful consideration, and following five years of unsuccessful negotiations, we now find ourselves in a situation where we have no alternative but to commence legal proceedings against the online music service SoundCloud.” We are entering a brave new world, only time will tell what the outcome will be. There is no denying, streaming is the future of music, but if we don't compensate those who create, what will there be to stream, or at least what NEW material will there be to stream?What are your thoughts?

PRS for Music members email

Dear Member,

PRS for Music begins legal action against SoundCloud

After careful consideration, and following five years of unsuccessful negotiations, we now find ourselves in a situation where we have no alternative but to commence legal proceedings against the online music service SoundCloud. When a writer or publisher becomes a member of the Performing Right Society, they assign certain rights to their works over for us to administer, so it’s our job to ensure we collect and distribute royalties due to them. SoundCloud actively promotes and shares music. Launched in 2008, the service now has more than 175m unique listeners per month. Unfortunately, the organisation continues to deny it needs a PRS for Music licence for its existing service available in the UK and Europe, meaning it is not remunerating our members when their music is streamed by the SoundCloud platform. Our aim is always to license services when they use our members’ music. It has been a difficult decision to begin legal action against SoundCloud but one we firmly believe is in the best, long-term interests of our membership. This is because it is important we establish the principle that a licence is required when services make available music to users. We have asked SoundCloud numerous times to recognise their responsibilities to take a licence to stop the infringement of our members’ copyrights but so far our requests have not been met. Therefore we now have no choice but to pursue the issue through the courts. We understand SoundCloud has taken down some of our members’ works from their service. With our letter of claim, we sent SoundCloud a list of 4,500 musical works which are being made available on the service, as a sample of our repertoire being used, so that they understood the scale of our members’ repertoire and its use on the service. We asked them to take a licence to cover the use of all our members’ repertoire or otherwise stop infringing. SoundCloud decided to respond to our claim by informing us that it had removed 250 posts. Unfortunately, we have no visibility or clarity on SoundCloud’s approach to removing works, so it is not currently clear why these particular posts have been selected by them given the wider issue of infringement that is occurring. Ultimately, it is SoundCloud’s decision as to whether it starts paying for the ongoing use of our members’ music or stops using these works entirely. If the streaming market is to reach its true potential and offer a fair return for our members, organisations such as SoundCloud must pay for their use of our members’ music. We launched our Streamfair campaign in June to raise awareness of this issue and highlight how music creators need to be properly remunerated from streaming. We believe that all digital services should obtain a licence which grants them permission to use our members’ music and repertoire, in this case the works of songwriters, publishers and composers. The streaming market cannot fairly develop unless this happens. We have always been pro-licensing and pro-actively work with organisations in order to propose an appropriate licensing solution for the use of our members’ works. We remain hopeful that this matter can be resolved without the need for extended litigation. Members will appreciate that this is now a legal matter and our ability to communicate around it is therefore limited by the legal process. However, we will try to share information and updates whenever we can.Please visit our website to read our frequently asked questions.

Yours faithfully,Karen BuseExecutive Director, Membership and InternationalPRS for Music

EnjoyPeaceNeil[*1] Source - Soundcloud $700 Million Valuation