Australia’s Government Supports Further Investigation Into Radio Caps

SYDNEY, Australia — After years of lobbying by the music industry, with support from several high-profile senators, the Australian government will support further investigation into the so-called “radio caps” — the controversial licence fees paid by radio broadcasters for the use of sound recordings.

The caps were legislated over 55 years ago, in the 1968 Copyright Act. Its critics say the rules prevent the recording industry from negotiating a new, higher rate on those sound recording royalties paid by commercial radio, a sum fixed at 1% of gross industry revenue.

Now, the federal government has thrown support behind a cost-benefit analysis into removing the current caps.

“Removing the 1% cap is simply the right thing to do. It’s impossible to defend an artificial cap set as a short-term measure over 40 years ago,” says PPCA chair and ARIA Award-winning artist Josh Pyke singer and songwriter. “Artists and rights holders deserve the right to negotiate free of this artificial constraint.”

Currently, commercial radio stations in these parts pay just 0.4% of broadcast revenue in sound recording royalties, compared with 3-7.5% in comparable markets like Canada, the United Kingdom and Germany, critics of the cap point out. Australia is the only country in the world with such restrictions, and six independent reviews have recommended their removal.

ARIA and PPCA CEO Annabelle Herd remarked: “The evidence base for removing these caps is already overwhelming. A cost-benefit analysis will confirm what Australian artists have long known: that a billion-dollar radio industry, built on the back of their music, can afford to pay a fair rate for the recordings it relies on.”

Herd thanked David Pocock, independent senator for the Australian Capital Territory, for his “continued championship of Australian music and for bringing this issue before the Parliament,” by way of the Copyright Legislation Amendment (Fair Pay for Radio Play) Bill 2023.

The ARIA leader also thanked thank Greens senator for South Australia Sarah Hanson-Young and Dr Sophie Scamps, member of parliament, for “their strong support.”

The government’s support for further investigation into the radio cap follows a breakthrough with the Copyright Tribunal of Australia last December, with a determination setting a new commercial radio sound recording broadcast license rate of 0.55 per cent of gross industry revenue, up from 0.4 per cent. In real terms, that’s a 38 per cent lift.