MBW Views is a series of exclusive columns written by notable music industry figures…who have something to say. In the comments below, Dan Gopal, Chief Commercial Officer, PRS For Music, Commentary on how music licensing is expanding and evolving.
The idea that music licensing is merely transactional is outdated. Today, there is greater recognition that music licensing is an important bridge between creators and users, a connection that encourages new ideas and adds value.
Throughout our 110-year history, PRS for Music has been at the forefront of developing solutions for an increasingly digital and global marketplace. Yes, we’re staying true to our founding purpose – ensuring songwriters and composers are fairly compensated for the use of their work – while also building new, stronger partnerships with our clients.
The licensing world rarely stands still. More and more services are vying for our eyes and ears, and for our precious “free time.” No longer bound by physical or linear models, broadcast and video game companies are embracing the possibility of providing users with more interactive and personalized experiences. Fans have never had more choice or control over how they access their favorite music, movies, TV and video games.
While parts of our industry have been forced to close during the pandemic, demand for music from fans and customers has accelerated. PRS for Music had to adapt quickly and seamlessly to this demand, finding new licensing solutions for markets that did not previously exist and the rapid expansion of a historically smaller service and industry.
During this time, we rapidly developed a new online live concert license – one specifically tailored to the needs of live concerts, from virtual stadium performances broadcast around the world to small, intimate gigs in artists’ bedrooms.
By being flexible and understanding our clients’ needs, we can give them the opportunity to try new ideas in the most uncertain situations. At the same time, by being responsive and adaptable, we ensure members continue to receive immediate royalties when they need them most.
Today, our customized licensing agreements continue to provide customers with the greatest freedom to grow, innovate and engage users. PRS for Music now represents more than 41 million songs and titles, and our licenses give businesses more choice than ever before, allowing them to find the music that’s right for them and their brand.
For example, a multifaceted platform like the BBC will leverage the broadest possible range of music rights across the full suite of services, including TV, radio, iPlayer and Sounds in the UK, and BBC Studios internationally. Every year, PRS for Music processes around 100 billion lines of music usage across BBC platforms, reflecting the key role music plays in the BBC. In turn, the BBC is a leading advocate for new music, introducing the music of PRS members to national and international audiences.
For more than a century, the partnership between the BBC and PRS has played an important role in the success of the UK music and radio industry. According to calculations by the British Music Industry Trade Association, the music industry contributed 6.7 billion pounds to the British economy in 2022.
Most of our time with clients is not spent discussing the next deal; They spend time discussing their business, market needs and developments. PRS for Music strives to understand the pressures and challenges they face, their musical strategies and their aspirations for the future.
Some transactions are simple, and we are constantly working to standardize, automate and systematize these relationships to make them more efficient for all parties. However, for those who require a more customized approach, we are constantly adapting the way we work.
“Customers are proud to know that the royalties collected by PRS for Music go directly into the pockets of songwriters and composers.”
We will process large amounts of data and analyze our methods to gain a comprehensive understanding of: How much of our skills are being used, how often, and in what ways? Are the current licensing terms correct? How to further refine and enhance the value of music? For entirely new platforms or new products from established partners, we will work with the company to understand its business model, price point and music content needs, then build a flexible license that can flex and change as it develops and grows .
Flexibility is built on trust and transparency. The more information we have, the better we understand our clients’ goals and business models, and the better we can support them. Importantly, transparency also ensures that the songwriters and composers we represent can feel confident investing in their greatest asset – their music. They must trust the wishes and intentions of their customers.
This symbiotic approach gives PRS for Music and our clients the time and space to find a shared vision, the “sweet spot,” that allows both clients and creators to maximize the value of their music.
Netflix is a good example of a customer where strong partnerships support the diversification of its business model. Netflix has grown tremendously since its founding nearly two decades ago, and we’ve been with them every step of the way; from physical to digital, from subscription to ad-tier models. Most recently, PRS for Music has supported the inclusion of live streaming and gaming into its already diverse consumer offerings.
We don’t need to preach to the converted: companies like the BBC and Netflix know the value of music, it’s an integral part of everything they do, and they themselves are rights holders. For other clients, however, it’s important to always emphasize the transformative impact music has on their business.
The value of music licensing cannot be measured solely in terms of money, which fails to reflect the true impact of music on a business. The emotional value that music brings to consumers of any business is well documented. It portrays a strong awareness of the company’s brand and culture and ultimately creates an environment where consumers are willing to spend their time and money.
Clients are also proud that royalties collected by PRS for Music go directly into the pockets of songwriters and composers. With a PRS license, they are helping to drive the music economy and support new and existing talent.
As we look toward the future, the potentially disruptive impact of artificial intelligence is already being widely debated. In practice, however, while musical AI is at the forefront of technology, the debate surrounding its licensing is nothing new. AI developers view music licensing as a barrier to innovation, too difficult, or inaccurately, unnecessary, echoing outdated notions of transactional licensing. History tells us that this approach serves no one’s interests and is a real obstacle to progress.
As our customers have grown, so has PRS for Music. Over the past five years, we have invested in building the systems necessary to meet the ever-changing needs and expectations of music users. The PRS team works to foster a mutual understanding of opportunities and challenges.
There may always be tension within the licensing ecosystem. PRS certainly makes no apology for always seeking the best terms for the songwriters and composers we represent. But 110 years of cutting-edge licensing practice has proven that cooperation, not adversity, and participation, not escape, are the elements that allow customers and music creators to grow together.
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