Royalty-based systems

Posted on April 7, 2008

Why does Equity allow broadcasters to operate a royalty system of payment?

We recognise that the issue of royalties versus residual/repeat fee payments remains a major cause of concern amongst the membership.

It is true to say that without the principle of a royalty being part of the negotiators tools many of our agreements would simply not work and therefore would become irrelevant. Our research has confirmed that where there is a true arms length sale (via whatever platform) the application of the royalty is the best option to ensure members are rewarded properly. For example with video/DVD, download to own, download to rent and overseas sales.

In relation to sales of programmes within the so called family of channels eg BBC 1/2/3/4, ITV1/2/3/4 and C4/E4/More4 Equity is challenging the broadcasters on the transparency of dealings and whether a price paid where the buyer and seller is the same is the most equitable manner in dealing with sales. Equity is gathering sales information both on the basis of arms-length and non-arms-length sales to ensure that the internal market generated by the broadcasters reflects a true market sale.

Should evidence point to serious discrepancies then Equity has the automatic right to challenge and audit those sales and as part of the pan industry negotiations look at alternative methods of payment for use within the family of channels

TV is Changing • Equity