YouTube, who are owned by Google, has pulled hundreds, if not thousands, of videos from its YouTube (http://www.youtube.com/) website following failed negotiations with the Performing Rights Society to come to an agreement regarding copyright licence fees.
The Performing Rights Society (PRS) issues copyright licences to individuals and organisations for the right to broadcast and perform music artists works in public and collects royalty payments on behalf of the artists in the UK.
The existing licence between YouTube and the PRS expired on 30 January 2009 and the parties have been at odds over the rate of royalty which YouTube should pay for each broadcast of a music video.
The PRS argue that the rate that they are asking for is in line with the recommended rate specified by the Copyright Tribunal in 2007. The Tribunal decided that a music artist should receive 8% of all gross revenue received in respect of each broadcast or performance.
YouTube however, argue that this rate is simply too high for websites such as YouTube which does not charge a subscription to its viewers, but rather makes money from sponsorship and advertisements. The effect being, according to YouTube, that the website would be running at a loss which would be unsustainable.
It has been suggested by some commentators that the decision to pull music videos from the YouTube website was a tactic to encourage or even entice the PRS to agree terms over the licence fees.
However, with the existing licence expired, YouTube cannot legally continue to broadcast music videos that require a licence from PRS. YouTube would be broadcasting copyrighted material without a licence and therefore without the consent of the copyright owner, which is a "prohibited act" under the Copyright Designs and Patents Act 1988.
Copyright holders are however unlikely to enforce their rights while negotiations are ongoing between YouTube and the PRS. YouTube may simply be taking the cautious approach by taking content off their site in order to avoid any potential claim from copyright holders. This is perhaps the safest route to protect their position, however the practical effect of the decision undoubtedly also puts pressure on the PRS to come to an agreement.
We await details of the outcome of negotiations.
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