The livelihood of composers seems steadily to be disappearing, at least according to official statistics, while monopoly is bolstered by copyright at every level
In this piece I provide a brief history of copyright in Australia seen through the lens of an Australian High Court ruling made in 2012. The case is Phonographic Performance Company [PPCA] of Australia Limited v Commonwealth of Australia  HCA 8 (hereafter, HCA 8, 2012). The case encapsulates the history of copyright law in Australia, with the judicial decision drawing substantive parts of its rationale from the centuries old Statute of Anne (8 Anne, c. 19, 1710), as well as copyright acts that regulated the Australian markets prior to 1968 and beyond.
Context and terms
Royalty caps regulate the amount that can be claimed by collection societies for performance royalties on musical works. The one percent cap on the broadcast of recorded performances was first legislated as part of the Australian Copyright Act (1968), the Commonwealth statute that has since governed intellectual property rights in Australia. The basis of capping arrangements (from the perspective of radio) is that: the Australian royalty collection societies (APRA, AMCOS, CAL, Screenrights, and PPCA) have historically been seen as monopolies, that broadcasters fall under a compulsory licensing arrangement, and that royalty caps are necessary to protect the commercial radio industry from extortionate claims against their revenues by publishing and recording companies (Atkinson, 2007).
CRA’s public position on the cap and role of radio is that commercial radio champions local musicians, invests billions in airtime to promote artists, and defends against the profiteering of ‘multinational record companies’, adding that their efforts add up ‘to billions of dollars in airtime and promotion’ (CRA, 2012a).
Platemakers, common good, and the one percent cap
Any historical view of copyright law in Australia inevitably leads to the Statute of Anne, a mercantile era law passed in 1710 that was premissed on a common good associated with the relationship between publishing and public learning. The High Court’s decision on the one percent cap was made in the context of the 1968 Act. Here is part of the High Court’s response to the challenge:
speaking generally the 1911 Act, like the Statute of Anne, took into account and balanced the interests of authors, entrepreneurs and the public. The public’s interest lay in the dissemination of copyright works, including dissemination on reasonable terms. Any detailed consideration of the historical context of the Statute of Anne supports this construction of its intent and its provisions. (HCA, 2012)
Anne is unambiguous on the public pedagogical function of copyright law. Its title declares it to be ‘An act for the encouragement of learning, by vesting the copies of printed books in the authors or purchasers of such copies …’ (8 Anne, c 19). It is also clearly anti-monopolistic.
The intention of Anne was to assert protections for authors against the market dominance of monopolies which had historically been held in Britain by the printing guilds (Ochoa and Rose, 2002). Its rationale was the common good derived from the publication of new works and the public learning associated with that dissemination. That the High Court draws on Anne for its historical force is ironic because the bulk of copyrights in Australia (as elsewhere) are controlled by an oligopoly of large international corporations. That fact is also noted by the High Court in its decision:
The second to fifth plaintiffs [Sony Music, Warner Music, EMI Music, and Universal Music PG] are the owners or exclusive licensees of copyright in numerous sound recordings, including sound recordings made prior to 1 May 1969. They collectively control (as owners or controllers) the majority of sound recordings which have been commercially released in Australia in the last 70 years. (HCA, 2012)
So on one side of the 2012 decision there are global oligopolies in recorded music copyrights; on the other, oligopolies in local, state, and national media properties. Australia is known for its intense level of media ownership concentration. CRA purports to represent 99 per cent of Australia’s 260 commercial radio licensees. It also notes recent consolidation of 80 percent of all stations into 12 networks (CRA 2012b).
The unintended irony of the High Court decision can be understood as good law only if, as Attali (1985) argues, a music recording has been seen historically as ‘a special kind of writing’ by lawmakers (1985, p. 98). That appears to be the case in the current decision which reasserts the validity of separating compositional copyrights from those that subsist in recorded works. The decision refers to the Australian copyright Act of 1911 (which was replaced by the 1968 Act), noting that ‘the 1911 Act granted a copyright to record manufacturers, which was expressly conflated with the copyright of authors and composers of original musical works’ (HCA, 2012). Following the Westminster Act of 1956, which ‘distinguished between copyright in works, including musical works, and copyright in subject matter other than works’ and ‘which included separate identification of the nature of copyright in sound recordings’, the 1968 act clearly distinguishes between the rights pertaining to composition and those that pertain to recording (HCA, 2012). The net result of this was to give the corporate “person” making the recording a separate but similar status to that of the person who composed the work. The central analogy drawn in the decision in respect of record duplication is the notion of the “plate maker”, a technical concept that has its origins in printed media.
The 2012 High Court decision sidesteps impacts upon composers, performers, and individuals (ie. non-corporate) record producers that may extend from its decision, and this too is a function of history. The unspoken economic argument that underpins the decision runs like this: there is significant capital investment involved in the plant and equipment required to make an original recording and its subsequent copies. It is in the common good that these services continue because they contribute to public learning. They cannot continue without statutory copyright protection that allows them to profit from their authorship and protects investment in production of the “plate”. However, privileging the corporate “plate maker” in current circumstances ignores the dramatically lowered cost of producing and disseminating recorded musical works brought about by the widespread availability of digital production technologies and the fact that every digital recording is now the equivalent of a “plate” in terms of its potential to generate infinite high fidelity copies.
The compulsory license
A major difference between the 1911 Act and the 1968 Act is the 1968 introduction of a compulsory broadcast license and an associated blanket protection against copyright infringement. While the Imperial Act of 1911 included a blanket compulsory recording license for published works, it also provided the right for any copyright controller to refuse public performance of a work, regardless of whether it was recorded or not. This resulted in a need for broadcasters to seek and negotiate individual rights for every recorded work. It was this discretionary power, held by both composers and record manufacturers, that broadcasters spent the following decades trying to undo.
The right to refuse caused havoc for broadcasters in 1931 when record manufacturers withdrew the right to broadcast any music whatsoever because the record companies (at the height of the Great Depression) believed that airplay had killed off record sales (Atkinson, 2007, ch. 6). It was during the ensuing copyright wars that the framing of copyright collection societies as voracious monopolies became entrenched in the construction of national and international copyright legislation ever since (2007; cf. Attorney General, 2005).
Atkinson (2007) summarises the Government’s views on the dispute at the time as follows: “APRA, a virtual monopolist backed by the law, had too much negotiating power. Thus the problem [the Federal Government] tried to solve was how to ameliorate the bargaining position of the commercial users of music” (p. 169). Negotiations between broadcasters and manufacturers followed the airplay ban and the manufacturers settled with the broadcasters on somewhat cumbersome terms:
They required the B. Class stations to discontinue request items, announce the maker of the record and full particulars of the record, state that copyright was reserved, broadcast only records of the associated manufacturers, limit the number of times a record was broadcast, limit broadcasts of records issued prior to the ban to once a week, and pay a broadcast fee. (2007, p. 176).
Broadcasters also continued to do battle with APRA over its fees and conditions. Atkinson (2007) points to the report on APRA delivered to the Federal government by the Association for the Development of Wireless in Australia (ADWA) (ch 4). The government’s ear was finely tuned to hearing criticism against APRA because it had especially targeted the publicly funded (A-Class) licensees and had, variously,
claimed up to 21 per cent of the broadcasters’ net revenue in license fees, withdrawn consent for the playing of popular works, prevented the broadcast of more than two numbers from an opera in a single radio program, restricted to four the number of times per week that popular items could be played, claimed twice for the same performance and claimed fees for the performance of works out of copyright. (2007, p. 132)
It is in this context of ongoing industrial warfare against APRA and the record manufacturers that the broadcasters first recommended a legislated broadcast royalty cap: “Australia should advocate, at the 1928 Rome Conference to revise the Berne Convention … to permit members to limit the amount of royalty payable by broadcasters” (Atkinson, 2007, p. 134).
The development of the 1968 Act took decades. According to Atkinson (2007), only at rare and exceptional times during those decades did debate turn towards the effects of the legislation upon composers and other artists (2007, ch 11). Labor Party figures, Gilbert Duthie and Rex Connor, were notable in their efforts to promote the rights of artists and composers while decrying the new legislation for its almost singular concern with balancing the rights of corporate parties, with some thought being given to the library and education sectors and none to the consuming public (2007, pp. 316-319).
Under the 1968 Act, as soon as a new recording is made in Australia it becomes a limited property right for any and all Australian broadcasters. While the broadcast attracts a royalty, the payment for it is automatically collected by a national system of monopolies whose function it is to redistribute those payments to copyright owners and controllers, neither of which are copyright originators, at least where the bulk of royalty distributions are concerned (HCA, 2012). The rights of the composer are merely a by-product of Commonwealth legislation: “copyright does not subsist otherwise than by virtue of this Act” (Australian Copyright Act, 1968).
Australia’s copyright law was historically constructed in the context of a copyright using market. Australia’s early copyright laws were written by Imperial Britain in order to protect British rights (Atkinson, 2007, ch 10). That assumption carried over into the 1968 Act with US and British companies dominating negotiations on the side of the record companies. The status of Australia as a ‘net importer’ of copyrights, a situation decried by the framers of the 1911 Act, was either ignored or not understood by the framers of the 1968 Act (Atkinson, 2007). The 1968 Act can be seen as being made, at least in large measure, on behalf of foreign interests, namely the foreign dominated record companies who, at the time of the Act’s framing, were responsible for 80 per cent of all recorded music broadcast in Australia (2007, p. 325).
The 2012 decision and some conclusions
PPCA challenged the one percent cap on the grounds that it was unconstitutional. It claimed that the 1968 Act exceeded the grasp of the Australian Constitution by acquiring new property rights without “just terms” (HCA, 2012). However, ‘just terms’ were never addressed in the decision because of the 1968 Act which extinguished the Imperial Act of 1911: “copyright does not subsist otherwise than by virtue of this Act”. Having decided that all copyrights prior to 1968 had been extinguished the question of just terms never arose (HCA, 2012).
Paradoxically, despite adverse legislative conditions for recorded music professionals almost everywhere, production of music has increased exponentially, with an estimated 97 million songs listed in the Gracenote database by 2011 (Resnikoff, 2011). Public access to these has also increased logarithmically through the proliferation of internet technologies and social media. These two facts not only challenge the idea that current copyright arrangements are useful in the promotion, production, and dissemination of new ideas and sources of cultural expression; combined with rapidly declining incomes, they entirely challenge the notion that copyright has the effect of protecting composers against the might of industrial monopolies (see also, Atkinson, 2007, ch1). In other words, the aims and rationale of the Statute of Anne, which endures as the basis of Australian copyright law, are no longer relevant under current conditions. Instead, [pullquote]the livelihood of composers seems steadily to be disappearing, at least according to official statistics, while monopoly is bolstered by copyright at every level.[/pullquote]
The question of a common law right to own and exploit one’s own creations may yet again be addressed, but perhaps next time it will not be publishers leading the charge. The legislative recognition of a common law copyright would fundamentally change the nature of composers’ negotiations with broadcasters, ISPs, publishers, recording companies, and film makers, especially where remuneration and copyright periods are concerned. The idea that anything other than a blanket license could function in mass societies is nearly impossible to justify or even imagine. However the terms on which such licenses are given are quite possibly open to a challenge on the basis of restraint of trade, just terms, and price-fixing issues.
The various paradoxes and ironies of the HCA 2012 decision that I have highlighted here suggest that the current Australian copyright regime has a limited life. Australian music producers are protected to the extent that they are a) part of one or more of the monopolies involved in the history of Australian copyright; and b) close enough to the centre of the recording industries that they can acquire a steady flow of paid work. This is not to suggest throwing the baby out with the bathwater. It is, however, essential for the cultural and economic health of the nation to increase the ability to Australian musicians to earn a living, and to the extent that copyright legislation is a barrier to that, it must inevitably be changed.
Atkinson, B. (2007). The true history of copyright 1905-2005: the Australian experience. Sydney: Sydney University Press.
Attali, J. (1985). Noise: The political economy of music. (Trans. B. Masumi). Minneapolis: University of Minnesota Press.
Attorney General of Australia. (2005). Review of one per cent cap on licence fees paid to copyright owners for playing sound recordings on the radio [discussion paper]. Canberra: Commonwealth of Australia.
Commercial Radio Australia (CRA). (2012a). Commercial Radio Australia Annual Report 2011-12. Sydney: Commercial Radio Australia.
CRA (2012b). What is commercial radio Australia? Available online at: http://www.commercialradio.com.au/index.cfm?page_id=1002. Accessed November, 2012.
High Court of Australia (2012). Phonographic Performance Company of Australia Limited v Commonwealth of Australia  HCA 8. Available online at: http://www.austlii.edu.au/au/cases/cth/HCA/2012/8.html. Accessed June 12, 2012.
Ochoa, T. & Rose, M. (2002). The Anti-Monopoly Origins of the Patent and Copyright Clause Journal of the Patent and Trademark Office Society, 84 (909): 675-706.
Resnikoff, P. (2011). There Are 97,000,000 Songs In This World… Digital Music News (October 7, 2011). Available online at: http://www.digitalmusicnews.com/stories/100611supersaturation. Access November, 2011.
Smythe, D. (1981). Dependency Road: Communications, Capitalism, Consciousness, and Canada. New York: Ablex Publishing.
This is an edited version of a longer article: Graham P (2013) Australian Copyright Regimes and the Political Economy of Music, published in Music Business and the Experience Economy, Springer.