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Distribution information guide: Background music suppliers

This information guide explains how the licence fees we collect from background music suppliers are paid out as royalties.

Where does the money come from?

A background music supplier is a company that creates and supplies curated music playlists and tailors them to a business type and specific premises. APRA AMCOS collects licence fees from background music suppliers in Australia and New Zealand. Background music is used by a large variety of APRA’s general background music licence holders (e.g. retail, salons, health practitioners).

What information does APRA AMCOS use to determine who should be paid?

APRA undertakes a direct allocation of each background music supplier’s licence fees against the detailed reports they provide to us. The list of licensed Background Music Suppliers in this category currently includes:

  • Australia - SMA, Mood Media (DMX), SBA, Marketing Melodies/Soundtrack your Brand, Play Network/Apple Music for Business
  • New Zealand – Audio Pilot, Automated Music Systems, Cloud, Mall Audio Limited, Marketing Melodies, Mood Media, Orange Door Music Video, Smartpay Ltd, Radio Network, Sky Music and Soundproof

Retail locations and hospitality businesses who are clients of Background Music Suppliers include: Coles, Woolworths Group, Dan Murphy’s, IGA, Officeworks.

Where a supplier’s licence fees are greater than $5,000 per quarter and their data is of sufficient quality, APRA will include a direct distribution of royalty payments using that supplier’s reports. Where licence fees are less than the threshold, then they will be apportioned across the direct pools for the other suppliers.

How are songs matched to the data APRA AMCOS receives?

The reports provided to us by the background music suppliers listed above are directly matched to the vast repertoire of songs in our database.

Key terms used in our Distribution Rules and Practices document

Songs:
The Copyright Act refers to compositions, musical scores in the form of sheet music, broadsheets or other notation as musical works. Lyrics or words to a song are considered literary works. When we refer to songs, we are referring to all the elements of a musical/literary work protected by copyright.

Census analysis:
APRA AMCOS receives data for 100% of a licensee’s music use and includes all data in its distributions.

Direct allocation - blanket:
licence fees from an individual licensee or a small group of closely connected licensees (e.g. network television stations) are distributed, usually on a census analysis basis, to the music used and reported to APRA AMCOS by the licensee. Individual distribution values are calculated from a single revenue pool based on frequency of use, duration, type of use etc.

Direct allocation – transactional:
as per ‘direct allocation – blanket’, but each song carries a discrete distribution value based on the number of sales/usages it has received during the reporting period, as reported to APRA AMCOS by the licensee.

Analogy:
licence fees are added to one or more existing distribution pools that are most similar in terms of their music content.