'We're still growing faster than the market': PRS CEO Robert Ashcroft hails record results

'We're still growing faster than the market': PRS CEO Robert Ashcroft hails record results

PRS For Music CEO Robert Ashcroft has told Music Week that the collection society will continue “engaging with the major platforms” as swelling online revenues contributed to record royalties for its songwriters, composers and publishers. 

As PRS reported a record royalties payout of £605.1 million for 2017 (up 14.7% on a constant currency basis), it revealed that online revenue increased by 52.7% to hit £122.9m. Of that, streaming was the lion’s share, up 68.6% to £103.7m.

“We’ve always been at the forefront of [digital] licensing,” said Ashcroft. “We’ve always believed in engaging with the major platforms in the online space and driving both the licensing terms and the business models.

“We’re very pleased to see YouTube moving into subscription services. What is important for us is a level playing field and these business models evolving. We’ve been very actively engaged in the development of that market.”

Ashcroft said that PRS is “looking forward” to the launch of YouTube’s planned subscription service.

“Spotify is building their business model, YouTube are investing in the business, Facebook are seriously considering their music strategy and have become licensed for the first time,” he added. “There is a lot of entrepreneurial activity on the part of the platforms. Apple discovered nearly two decades ago now how music can drive their business and I’m sure that Facebook and YouTube will be following in those footsteps, and Amazon are also investing in their services.”

He stressed that PRS would also be continuing discussions with the European Commission for a “level playing field” on copyright and royalties, and ensuring that “our members get their fair due” in licensing negotiations.

Overall revenue increased by 15.4% in 2017 (12.7% on constant currency) to £717m. After costs, PRS distributed an all-time high of £605.1m to its members, numbering 130,000 in the UK and two million worldwide. The payments covered 4.4m songs and compositions. PRS registered 6.6 trillion performances of music reported last year.

We’ve always believed in engaging with the major platforms in the online space

Robert Ashcroft

“We’re very pleased to see the growth across the board again in our business,” Ashcroft told Music Week. “What’s particularly satisfying is we think as the evidence rolls in that we’re still growing faster than the market.”

While online experienced the biggest growth, international revenue was the largest proportion at £261.4m – an increase of 5.2% on a constant currency basis.

“It’s a lot of work to collaborate with these [international] societies to make sure they’re as successful as they can be and our members get their fair due,” said Ashcroft. “You can see that, in the results over the last seven or eight years, our international revenues have grown substantially – it’s a fantastic result.”

Revenue was particularly strong from Europe (up 13.1%) and North America (up 16.8%). Asked about the popularity of UK repertoire overseas, Ashcroft noted: “Nine of the top 10 touring bands last year around the world were PRS members – and Ed Sheeran was on that list.”

PRS For Music is facing increasing competition for multi-territory publisher mandates in online licensing through its ICE joint venture.

We have just won some business, we’ve just lost some business – as you know, Warner/Chappell decided to put some business with SACEM,” said Ashcroft. “As new entrants come in they are going to pick up some bits, but we’re very confident of the service we’re going to be able to offer through the new ICE platform. You can only go out and compete on the basis of your service and your price." 

Public performance may be a more mature market in comparison but collections remain robust at £198 .1m – up 8.1% year-on-year. Only cinema let the side down with revenue dropping 13.3% as a result of a worse box office performance blamed on a weak release schedule.

That wasn't an issue for tours and Ashcroft welcomed the live boom as live revenues within public performance were up 11.7% at £34.5m. Tours from Ed Sheeran, Little Mix and Adele were a contributory factor. However, Ashcroft sounded a note of caution about any complacency.

“[Live] has grown substantially, we know that there’s another huge investment coming into London with another arena to rival the O2,” he said. “We know there’s a huge appetite among consumers to see live music. We’re feeling increasingly confident that the music business is there to stay in live.

"But obviously when you see ticket prices go up the way that they have, and you see some of the smaller venues closing, you worry about the ecosystem a bit. So I would hope that we’re on a sustainable long-term trend but it would be wrong to be complacent about it.”

He confirmed that a final ruling from the Copyright Tribunal on the revised live tariff was forthcoming.

“We’re waiting for the Copyright Tribunal to bless the deal that we’ve taken to them,” he said. “We can’t just change it because we’ve reached agreement with the live sector, we have to get the Copyright Tribunal to bless it. They want to make sure it’s fair and reasonable.”

Broadcast income was up 8.5% as the society licensed more TV broadcasters. There was also a benefit from the conclusion of the ITV copyright tribunal.

Ashcroft said that costs – up 11.4% – are “under control” and he stressed that half of the increase was down to launch of the new JV with PPL.

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