When the charges for playing music in stores rocketed in 2005, creating store ambience became an expensive luxury. What’s changed and how does it
affect retailers?

Why are we talking about it?

The Copyright Tribunal has ruled charges for playing music in stores are too high after legal action initiated and led by the British Retail Consortium. This decision could save retailers up to £5m a year and lead to a £20m refund for excess charges.

Why were retailers fighting the charges now?

In 2005, Public Performance Limited (PPL) – the body that imposes fees and collects payments on behalf of record companies – increased charges that saw tariffs rise by as much as 192% for some retailers. A fashion retailer reported its annual bill went from being £176,000 to £408,000, while a tile chain’s bill almost tripled going from £25,000 to £73,000.

In addition, the new rules stated businesses must have a PPL licence to play radio and television programmes on their premises. This resulted in a huge rise in costs for some retailers, with one DIY chain that had previously faced no charges, reporting a £290,000 bill following the change.

For the past four years, the BRC have fought to have charges lowered. A spokesman from the organisation says: “It was a massive increase and retailers thought it was very unfair. There was no justification for the change, no change in services to warrant asking them to pay more. They got nothing in return.”

What has changed?

The Copyright Tribunal ruled on October 22 the 2005 increase had been excessive and it is now capped at 10%.

BRC food and consumer director Andrew Opie says: “We welcome the tribunal’s decision, which establishes a level of tariffs that is fair for all parties.

He adds: “Being able to play music or have a radio on is important for customers and staff in many shops. Artists and composers are entitled to a payment but increases on this scale cannot be justified and are out of reach for many retailers.”

And what about PPL?

PPL is challenging the tribunal’s decision and due to this charges could change again if it is successful in its appeal.

A BRC spokesman says: “We will have to wait and see what happens now but I think PPL probably realise it can only make such large increases once.

“The tribunal’s ruling is very important. Things are already tough at the moment and anything that frees up cash flow will be welcomed by retailers.”