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MCPS: tender process means more money for members DYBALL HAILS ‘KEY MOMENT IN HISTORY’ AS SOCIETY PREPARES TO OUTSOURCE ADMINISTRATION
PUBLISHING BY MARK SUTHERLAND
MCPS boss Jane Dyball has told Music Week that putting the administration of its operations out to competitive tender will allow the collection society to concentrate on growing revenues for its members.
The Mechanical Copyright Protection Society, which licenses mechanical copyrights, will today (April 4) issue a ‘request for proposals’, inviting companies to tender for the right to administer its back-office operations and other areas of its business. Services covered could include the processing and issuing of licences, royalty collection and distribution, copyright database maintenance, data analysis, membership services and the administration of the Independent Music Publishers e-Licensing business (IMPEL).
Dyball – CEO of the MPA Group Of Companies, which owns MCPS – told Music Week the decision would come to be seen as a “key moment in MCPS history” – and help increase payments to the society’s 26,000 music publisher and composer members.
“Everything that we’re looking at leads to greater revenues,” she said. “It should also mean more efficient service to our licensees and faster licensing across every area of our business, because what our members want is to do deals at the right price. Their focus is on concluding deals and getting money out the door.”
In 2014, MCPS distributed royalties worth £140.27 million, down from £148.04m in 2013. Mechanical rights payments have dropped in line with the decline of physical sales, but Dyball said the outsourcing of administrative functions would cut costs, streamline business operations, give MCPS greater control over the valuation of rights
Jane Dyball: “You don’t have revolution without risk”
and allow the body to develop strategies to grow revenues again.
“Growth will come from a forensic examination of all the licences we have on offer,” she said. “We have not had much chance to look at licensing but, where we have looked at it in the past couple of years, we have proof of our ability to improve revenue significantly. We have to go through every licence scheme and work out whether it’s serving its purpose. That might involve being more creative about how we license, or involve individual negotiations with big copyright users.”
Collection society PRS For Music currently carries out MCPS’ administrative functions. The two bodies formed an operational alliance as the MCPS-PRS Alliance in 1997, but restructured in 2013, with MCPS becoming a client of PRS. The current contract – which Dyball said had helped stabilise the MCPS business – expires on December 31 this year.
A PRS For Music spokesperson commented: “We are aware that MCPS are assessing its options in its search for an SLA [service level agreement] partner through a formal process, which includes ongoing dialogue with PRS. Like us, MCPS must act in the best interests of its members to regularly evaluate agreements in much the same way that we do with our own providers. We value the working relationship we have built up with MCPS over many years and welcome this opportunity to clarify the services and performance standards they require.”
Dyball admitted that the change carried some risk, but added: “You don’t have revolution without risk. We have an incredibly strong team in terms of experience and expertise in all areas of our business. Change is always concerning to people and it’s our job to ensure that all of their concerns are addressed. But actually what I’m getting from our members is an air of excitement.”
Dyball said MCPS had already received over 20 expressions of interest in tendering, from collection societies to tech companies, with “a lot of familiar faces” likely to be involved in the process. “No one is going to be excluded,” she said. “Everyone is going to be judged on the strength of their application.”
The deadline for submissions is 6pm on June 30, with a potential start date for the successful applicant or applicants as early as January 1, 2017.
“I know this is a challenging environment,” said Dyball. “But I really feel that, once we’ve finished this process, we’re going to be flying. I don’t think we’d be putting ourselves through the work involved if that view wasn’t shared.”