Copyright Tribunal out of tune, says Fitness Australia
The fitness industry said it is extremely disappointed with the Copyright Tribunal decision to substantially increase copyright fees for the use of music in group exercise classes, following the outcome of a fierce battle with the Phonographic Performance Company of Australia (PPCA).
The current PPCA license fee is 96.8 cents per fitness class with a capped annual maximum of $2,654. The Copyright Tribunal has today increased this substantially, to either $15 per class or to $1 per participant, which equates to an increase of 1,500%[1] for the cost of a PPCA license in a typical fitness centre.
During the judgment proceedings, the Tribunal stated that they had rejected the PPCA's economic evidence on the basis of consumer 'willingness to pay' for music in classes when making this decision. "This means that Fitness Australia's response against the PPCA claim was technically successful", said Lauretta Stace, Fitness Australia Chief Executive Officer. However, the Tribunal has turned to 'other evidence' and 'judicial estimation' to make this determination, which is now the subject of detailed review by Fitness Australia and its legal counsel.
"We are astounded that the Tribunal could reject the economic evidence put before it by the PPCA and still award them such a substantial increase to the licence fee", said Stace.
"The international record companies, who are represented by the PPCA, have shot themselves in the foot by demanding outrageously high copyright licensing fees from the fitness industry, the majority of which go straight into record company coffers. To mitigate the impact of such a decision, Fitness Australia members are already beginning to use music in their gyms that is free of PPCA copyright," said Stace.
"Les Mills, the largest provider of choreographed exercise classes has already developed a product that it is PPCA copyright free, allowing gym operators like Fitness First to already move to introduce high quality music that is not subject to PPCA copyright. The reaction from gym members has been highly supportive so we now expect that all gyms will move to alternative music options," said Ms Stace.
Susan Kingsmill, owner of Hiscoes Fitness Centre said "The fitness industry has traditionally provided a great platform for promoting Australian performing artists but the record companies, driven by greed, seem intent on destroying this relationship.
"This decision will lead all fitness centres to seek more affordable music alternatives to the detriment of Australian performing artists, but the artists only have the record companies to blame for this," she said.
Fitness Australia responded to the claim by the Phonographic Performance Company of Australia (PPCA), which represents the international record companies, on behalf of a united fitness industry, in a fierce battle culminating in a six week Tribunal Hearing in April 2009.
"Fitness Australia's evidence clearly demonstrated that a substantial increase to the tariff could not be justified under any circumstances, particularly as the fitness industry has access to high quality alternative music that gym goers are perfectly happy with and that is not part of the PPCA repertoire", said Stace.
"I would like to thank all those members of the fitness industry who have, at a time when many have faced financial challenges, made a contribution to our legal case, especially Fitness First and Les Mills, whose leadership and support has been exceptional", said Stace.
Fitness Australia's legal advisers are now reviewing the decision to determine whether there are grounds for appeal.
To keep track of this issue visit www.operationmusic.org.au
[1] Based on Copyright Tribunal judgement of an increase to $15 per class.
