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The Southern African Music Rights Organisation (SAMRO) CEO Nothando Migogo has noted with deep concern, this past weekend’s media reports about the organisation’s distribution rules.

A sensational report by journalist Charl Blignaut in the City Press, sensationally headlined, “Gospel shocker: How black musicians got screwed”, raised several allegations, particularly around SAMRO member Ms Hlengiwe Mhlaba’s royalty pay-outs, SAMRO’s relationship with multinational publishers, and the matter of public domain works.

 

The report alleged that of the 90 songs collecting royalties through SAMRO on behalf of Ms Mhlaba, “24 were only paying out 16.7% of what was due to her”. It further said that, “the remaining 83.3% was, according to SAMRO’s own database, paid to a mysterious composer called ‘DP’”, and that “Mhlaba claims that in the course of 14 albums she has had well over R100, 000 taken by DP – on top of the millions SAMRO paid to [her former manager Sipho] Makhabane without her ever formally signing her rights over to him”.

Disappointingly, despite an extensive response to an equally lengthy query, SAMRO’s comments were largely overlooked by City Press, and this resulted in a news report containing several factual inaccuracies.

 

Firstly, it must be noted that ‘DP’ is not a person, but simply an internal system categorisation that is allocated to all public domain works. A musical work will be in the public domain if it never had copyright in the first place, or if the copyright has expired (which occurs 50 years after the death of the composer as per the Copyright Act).

 

“We requested Mr Blignaut to provide evidence of his calculations and allegation that SAMRO has allocated R2 billion to the ‘DP’ category, which he did not. Based on the information at my disposal, that figure is way off the mark. I have commissioned an exercise to get an accurate figure, which our board and membership of SAMRO will have access to within the week,” said Migogo.

 

Regarding the 16.7% Arrangement Rule – this deals with music arrangements of an existing musical work. The rules stipulate that where a composer creates an arrangement of an existing song, he or she receives 16.7% of the copyright in the arrangement. The balance goes to the composers of the original work because the presumption is that original work forms the basis – and thus lion’s share – of the new arrangement.

The songs in question, arranged by Ms Mhlaba, were in the public domain, which means there was no copyright accruing to the original composition which she was arranging. Therefore, according to the Arrangement Rule in force at SAMRO, Ms Mhlaba was allocated the 16.7%.

 

The remaining 83.3% is assigned the category ‘DP’, indicating that this portion is in the public domain and technically, this remaining 83.3% does not have a royalty attached to it.

Because SAMRO licenses its users, e.g. broadcasters, on a blanket basis (i.e. a predetermined amount to be paid out to all SAMRO-member works used by the user) and not on a per-song basis, it is evident that SAMRO does not specifically collect public domain/DP royalties.

 

The pre-determined licence fee offers the user indemnity against copyright claims. SAMRO then has to ensure that the fee received is divided equally against all the in-copyright musical works reported on the basis of airplay. Where some of the works reported are in the public domain, SAMRO then has to (during the internal royalty processing) find a way of removing those public domain works from the distribution pool. This is when they get categorised as DP, meaning they do not accrue any royalties. The royalties that would have accrued had the work been in copyright, are ring-fenced and distributed to all SAMRO member musical works that have been active in that year. There is no account or purse of royalties belonging to DP.

 

 

However, SAMRO also acknowledges that the redistribution policy of ‘DP’ categorised works may not be the best practice and, as part of its policy overhaul, is committed to reviewing and addressing this urgently, in consultation with its members. SAMRO also urges the DTI to urgently release the regulations on the copyright treatment of indigenous and traditional musical works.

 

Regarding the contractual relationship between Ms Mhlaba and Mr Makhabane, who are both SAMRO members a way forward was agreed upon, in writing by Mr Gilfillan, to ensure that the SAMRO rules are applied objectively. In instances where there was conduct which was not in line with the rules or it was found that one member benefited unduly at the expense of another member, this has been and will continue to be addressed. SAMRO takes the allegations of corruption seriously, and will take appropriate actions to ensure that the matter is resolved.

 

SAMRO also seeks to clarify the issue of its relationships with multinational publishers being blatantly untrue. It was reported that over half of SAMRO’s board is made up of multinational publishers, while in actual fact, only one board seat is occupied by a publisher that can be described as a multinational publisher. The SAMRO board can be viewed at http://www.samro.org.za/about.

 

SAMRO also notes that the good news of more royalty income remaining in the country was unreported. The listening patterns on radio have previously dictated that the majority of royalties in the past were paid to international rights holders. Encouragingly, though, it must be noted that in the last radio distribution (March 2018), a total of 6,907 local members earned either for the first time (over 2,000 were new earners) or increased their SAMRO earnings significantly, which means more royalties are staying in the country. In total, an increase of R24.2 million in local distributions was seen.

 

 

Finally, SAMRO welcomes the enquiry by the Minister of Arts and Culture Nathi Mthethwa, this week and looks forward to engaging with all relevant departments of government on matters of copyright and growing the creative economy in South Africa. The winds of change with new executive management since July 2017 have brought many improvements and a commitment remains work with our members to further improve where necessary and possible.

 

 

It must be recorded that long before the weekend City Press story broke, SAMRO had long been working on reviewing the rules in question as part of a far wider policy review. This was because of the clear disharmony between some of our policies and the SAMRO we wish to see in the future.

 

 

SAMRO will be engaging in roundtable meetings with its members in our three major centres during the month of April, after which an Extraordinary General Meeting in June 2018 will be held and where new rules will be agreed upon. The dates, which have already been communicated to members, are as follows:

 

  • Cape Town – 10 April, 2018
  • Durban – 13 April, 2018
  • Johannesburg – 23 April, 2018

 

 

“A commitment to changing and evolving for the benefit of our members has been unequivocally made by our board and new executive management at its last AGM,” said Migogo. “Further, we are committed to ensuring that any wrongdoing in the past will be accounted for. We are committed to working with the relevant government departments to ensure SAMRO operates at the utmost levels of efficiency and transparency.”

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