MUSIC to dance to is about to cost more. A landmark decision yesterday will cost nightclubs and dance party promoters — and maybe punters, at the end of the line — millions of dollars a year.
The Copyright Tribunal yesterday sided with artists to approve an application by the Phonographic Performance Company for an increase in music licence fees paid to artists and record labels by nightclub venues and dance parties.
It lifted rates for recordings played in nightclubs from seven cents per person a night to $1.05 per person. The dance party rate rises from 20 cents to $3.07 per person.
The nightclub industry fears the increase will send many clubs broke.
Clubs Australia executive Anthony Ball said that it could even make dance parties too expensive to run for some operators.
"The increase from (almost) eight cents per person to $1.05 … is astronomical, it's over 1000 per cent," Mr Ball said.
"It will see clubs that provide discos and dance nights withdraw their services in suburban and regional parts of the country. They might just decide it's all too expensive."
Likewise the Australian Hotel Association. "We're a bit stunned by the size of the increase," said the director of national affairs, Bill Healey. "It will be very difficult for some to stay in business, but it might open the door for some live music."
Not surprisingly, musicians took the opposite view, hailing the decision.
Lindy Morrison, the former drummer of the Go-Betweens, who is also a Phonographic Performance Company board member, was elated with the decision. The work of recording artists had been "subsidising" the revenues of nightclubs for too long, she said.
"As an older artist, receiving those cheques becomes very important."
Dean Cherny, a DJ with Melbourne band Dirty Laundry, agrees with the principle, but wonders about the practice. He expects the increase will particularly affect smaller bar owners who do not charge entry. He points out that clubs work on cash, so "if there's a fixed cost, then people are going to be far less likely to declare".
Phonographic Performance Company chief executive Stephen Peach said it was "highly unlikely" to send any clubs broke. "What we've got to keep in mind is that number is less than half the price of checking a coat, it's probably 20 per cent of the price of a drink.
"The majority of artists at the seven-cent rate would be earning less than a couple of hundred dollars a year from nightclubs. At this sort of rate, no one is going to be retiring or buying a holiday house — it's going to get them more towards getting a reasonable income."
Phonographic company board member Paul Christie, who was Mondo Rock's bass player, said: "Artists are entitled to a fair day's pay for a fair day's work and this will go some way towards compensating us for our creative output."
But Dror Erez, who runs The Prince in St Kilda, was flabbergasted by the 14-fold increase in licence fees.
"The CEOs of the record companies will be sharing this money. Most of the music we play is from overseas, and I bet those artists don't see a cent," he said.
After operating costs, the Phonographic Performance Company distributes half the money to record labels and the other half to Australian artists.
