LONDON — Though record company revenues are continuing to fall, U.K. royalty collection society PPL has reported reporting record-breaking results for 2006 — demonstrating that the actual use of music is on the increase.
PPL’s license fee income grew 13% last year to £97.9 million ($193.4 million); distributable net revenue was up 11.8% to $166.7 million; and international income, which five years ago stood at zero, reaching $11.9 million — a 100% increase on 2005.
PPL collects money on behalf of record companies and the musicians who perform on sound recordings. Its revenues come from broadcasters who use those recordings in their transmissions and public performance of the recordings in the likes of stores, bars and other outlets.
The majority of PPL’s license fee money — $104.1 million — came from broadcasters, while the public performance side of the equation generated an all-time high of $77.4 million.
PPL does not operate to make profits, so after it has deducted its operating expenses, which amount to about 15% of its income, it distributes the remaining funds among its 3,500 record company members and more than 40,000 registered performers.
Payments are based on the usage each track of recorded music receives in a year, with the copyright owner (usually a record company) of each track receiving 50% of the relevant payment and the musicians who helped create the track splitting the remaining 50%.
“Our excellent results for 2006 are clearly beneficial to all our constituents,” said PPL chairman Fran Nevrkla. “New business opportunities are emerging in new media as well as in the traditional business environment, especially public performance.
“PPL is determined to work extremely hard to ensure that the ever expanding use of recorded music is properly licensed and fully monetized, which is absolutely essential, both for the record labels and individual performers.”