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Elton John and Paul McCartney Urge Review of UK’s Song Royalty Payment System

Famous UK songwriters, such as Elton John, Paul McCartney, and Thom Yorke, are urging a review of the payment structure for songwriters within the country’s royalty collection system, expressing concerns over administrative costs.

A group of 18 songwriters sent a letter last week to PRS For Music, seeking clarification on why a substantial portion of royalty collections is directed toward business expenses. PRS is responsible for representing the performing rights of songwriters, composers, and music publishers, collecting royalties whenever their music is publicly played, whether in arenas, bars, or restaurants.

“This appeal is motivated by growing concerns about the transparency, accuracy, and overall representation of members’ interests,” the songwriters mentioned in the letter, which was reviewed by Bloomberg. They stressed that establishing clear and fair methodologies is essential for future songwriters, emphasizing that “their livelihoods will depend on it.”

For 2024, PRS announced the collection of £287 million ($387 million) for public performances on behalf of songwriters, while deducting £49 million for “distribution processes.” The songwriters questioned why more efficient technologies are not employed to reduce these costs.

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A PRS spokesperson responded to Bloomberg, saying, “The letter highlights the challenges involved in collecting data from hundreds of thousands of businesses and accurately matching it with millions of individual works to ensure correct royalty payments.” They added, “We have met with representatives of these members and will keep considering practical changes aimed at achieving our mutual goal of supporting the songwriter and composer community.”

The intricate copyright system that supports songwriters’ incomes has faced criticism in the US for similar reasons. The US Copyright Office is currently examining the existing process, overseen by multiple performing rights organizations (PROs). The growing number of PROs has caused venue owners to feel pressured, while songwriters argue that the complex system complicates payment tracking and often diverts funds away from lesser-known artists. Some songwriters have reported hearing their songs played in public without ever receiving compensation.

Part of the challenge is identifying what music is played in various venues since licensees usually do not employ tracking technology, such as automatic streaming services or listening devices. This issue also applies to live performances.

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In the US, PROs encourage performers to submit setlists to guarantee proper payment to the respective songwriters. However, this practice is not always adhered to. In the UK, the Guardian has reported that PRS holds millions in unpaid royalties due to the lack of setlists for over 100,000 gigs, impacting the fair distribution of funds.

Additionally, PRS is presently facing lawsuits from songwriters regarding its handling of concert and live performance payments, where songwriters are entitled to a share of ticket sales. The lawsuit claims that PRS imposes high administrative costs on smaller songwriters while privileging well-known stars.

In their recent letter, the writers warned that ignoring their concerns could jeopardize future membership retention, “something we believe PRS would want to avoid.”

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