MTV ends royalty tiff

Dispute resolved, channel free to strike direct deals

LONDON — Viacom’s MTV Networks Europe has resolved its royalties dispute with Europe’s independent record companies, signing new contracts shortly before the midnight Wednesday deadline.

The acrimonious yearlong dispute involved negotiations over the rates MTV pays the sector for showing their videos — the music channel had threatened to pull indie vids unless the dispute were resolved.

The companies have now agreed to new, undisclosed terms. Deal involves a contract with U.K. collection society Video Performance Ltd. for collective licensing but does not restrict MTV from reaching direct deals with independent labels.

Spat started when MTV and VPL began renegotiating a previous five-year license. VPL accused MTV of demanding a 55% cut in royalties to £840,000 ($1.55 million) a year. MTV claimed VPL proposed a new rate equivalent to 2½ times the old rate. The indies rebutted that.

MTV tried to make direct deals with individual indies, but after intense pressure from those companies, it backed down and returned to negotiations with VPL.

“We are very pleased indeed that this particular argument is over,” said Alison Wenham, chairman of British independent trade body AIM, who was one of the chief protagonists in challenging MTV’s stance.

“We hope and trust that the principle of collective licensing, dear to the independent community, is now respected and upheld. We now look forward to discussing with MTV the proper licensing of videos in other territories and how independent record companies should be paid for the use of these rights.”

MTV Networks Europe president Brent Hansen added: “By signing this deal, we are making a firm statement of our unwavering commitment to indie artists and labels and affirming their value and importance to us and our business.”

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