Q & A with the Neighbouring Rights Collective of Canada
Does playing the radio in a club come under any type of tariff for the club or is that fee covered by the radio stations?
Pursuant to a provision of the Copyright Act, a club that only plays music using a traditional AM/FM radio receiving set is not subject to NRCC Tariff 6.
Is there a difference between the perceived music value for a dance club/restaurant as opposed to a fitness facility?
Music used to accompany dance or fitness activities has a greater value than music used as background in a restaurant or retail establishment. Tariff 6 will apply to both dance venues and fitness venues, but each will be subject to separate rates. The value of music to fitness is validated by third-party economic analysis that will be presented by NRCC at the upcoming Tariff 6 hearing.
It is the Copyright Board of Canada who will ultimately determine the rates and relative value at the upcoming Tariff 6 hearing.
The value of music is also validated by international research, including a recent UK study that was conducted to investigate the demand for, and impact of, music across a wide range of fitness venues. The results showed that using music in fitness venues attracts and retains customers, drives spending and improves employees’ productivity. Details of the study and many other statistics on the value of music to business can be found at www.musicworksforyou.com.
Additionally, a PPCA (Phonographic Performance Company of Australia Ltd.) study shows that most Australian fitness class participants “regard music as essential to fitness classes and could not imagine the classes without music. It follows that an absence of music in fitness classes would result in a significant drop in membership, and hence revenues, of fitness centres.” Further information on this study can be found at www.ppca.com.au/fitnessclubtariffupdate
These results highlight the link between music, profits and atmosphere, which is great news for fitness venues seeking ways to differentiate themselves from their competitors and improve their revenue and image.
Why are the musicians asking for more than what the songwriters are receiving (SOCAN vs NRCC)?
Tariff 6 is NRCC’s inaugural tariff covering the use of music by dance and fitness venues. NRCC’s proposed rates are not based on SOCAN rates, as it is our belief they have been historically undervalued (having never been based on economic evidence). NRCC’s proposed rates are based on the comprehensive evidence it has prepared for this proceeding including an economic valuation of the use of music in fitness venues.
NRCC’s proposal is consistent with international practice. Both dance and fitness venues are already paying royalties to artists in many other territories.
Are mixed music CDs purchased at events like Can-Fit-Pro, created for the purpose of teaching fitness classes exempt from the Tariff?
No. The producer of a fitness CD may have paid for “mechanical rights” but it would not have paid for the “performing rights” covered under NRCC and SOCAN licensing. Licences to publically perform fitness CDs or similar music compilations are the responsibility of the person or organization hosting the public performance.
The royalties that come from NRCC “performance rights” are a vital income stream for artists, the royalties they earn from these rights ensures they can continue to create and have a career in music.
Will clubs who decide not to play music or possibly non tariff music be exempt from Tariff#6?
The Copyright Board of Canada discounts NRCC’s tariffs to take into account sound recordings that are not within NRCC’s repertoire, thus giving NRCC licencees a blanket licence to play as much recorded music as desired.
Fitness venues that do not play recorded music would not be subject to the tariff. However the use of recorded music provides considerable value to fitness venues and their members. For example, a recent Music Works survey showed that:
- 77% of fitness clubs respondents agreed that a gym with music was more appealing to them than a gym without
.
- 82% of gym users say they like to hear workout music when they go and 60% say that a gym playing music they like would make them much more loyal to that gym.
Details of the study and many other statistics on the value of music to business can be found at www.musicworksforyou.com.
The purpose Tariff 6 is to ensure that the creators of this music receive fair and equitable compensation for the use of their music by fitness venues and dance venues.
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