There is broadcasting through radio and TV. It is now extended to over-the-top (OTT) streaming services or music apps. In the Copyright Act, there is section 31 D which does not extend to internet broadcasting. It is to protect the artists who were signing away their rights to dodgy agreements. At present, a radio station can pay as royalty 2 percent share of its ad revenues, and use the repertoire of music of any company. Thus a music industry worth Rs. 3000 crore pays just Rs. 60 crore as royalty to be distributed among record labels, authors, composers and publishers.
The licensing of interactive services at many places is voluntary which means the buyer and seller negotiate and agree on a price.
In 2016, a circular form IPP states section 31 D covers internet broadcasting too . In India almost 70 per cent of revenues in music industry come from digital or streaming / downloaded music. Digital advertising is growing at the rate of 28 percent. The issue is whether to have statutory licensing at more than 2 per cent or have voluntary licensing.
It all started with compression technology in the late 1990s. But start ups such as Napster threw many take aways. The revenues in the music industry fell, but since 2014, they are on the rise again. Both film and TV are experiencing disruption on account of OTT services. What happens in music industry will be a lesson for them.