Broadcasters fight against tariff boost.

In a filing to the Federal Court of Canada in Toronto yesterday (Nov. 14), the Canadian Association of Broadcasters requested a judicial review of Copyright Board of Canada's Oct. 14 decision on commercial radio tariffs for the years 2003 to 2007.

The board's decision on two tariffs boosting the monies radio stations pay to the Society of Composers, Authors, and Music Publishers of Canada (SOCAN) and the Neighbouring Rights Collective of Canada (NRCC) for the rights to play music are expected to generate over $55 million ($46.1 million US) for SOCAN and NRCC. The old rates would have generated approx. $44 million. ($36.9 million US).

Under the new rates, radios stations playing music will continue to pay the performing rights society SOCAN 3.2 per cent of their first $1.25 million ($1.04 million US) in annual revenues and $100 ($83.8 US) to the NRCC. Annual revenues over that amount increases from 3.2 to 4.4 per cent for SOCAN, and from 1.44 to 2.1 per cent for NRCC.

Music stations that play less music will see an increase in their rate from 1.4 to 1.5 per cent of the station’s annual revenues for SOCAN, and from 0.64 to 0.75 per cent for NRCC.

In the board’s decision, it noted that the SOCAN royalty rate had remained unchanged for 25 years and had not been reexamined in almost 50 years. The board further noted that the current rate undervalued the role music contributes to the radio industry and that the amount and manner in which music is used by commercials has helped radio to create significant efficiencies.

The CAB, the national voice of Canada's private broadcasters, is appealing the decision on the grounds that the the federal government tribunal based its arguments on "immeasurable conjecture," such as its finding that past boards undervalued music and the board's statement that increased advertising revenues by certain radio broadcasters support a claim for an increase.

"Canada's radio broadcasters cannot accept such an egregious and flawed decision, which makes monumental increases to the tariffs they pay without any rational or acceptable justification," says CAB president and CEO Glenn O'Farrell.