Vijay Lazarus, the president of the Indian Music Industry (IMI) has over 35 years working experience in the global audio and video industry. Since taking over in 2004, he has synergized IMI, PPL & IPRS into vibrant transparent organizations performing the vital role in monetization of all audio & video content usage across formats, services, users, telcos and establishments.

He initiated the industry's crusade in creating awareness of Intellectual Property rights and enforcing their protection. Lazarus talks to Anita Iyer about the music industry's plans to fight piracy and to build bridges with the FM radio industry.
Excerpts:

The IMI recently launched the Music Mobile Exchange (MMX) for curbing mobile chip piracy. Can you elaborate?

MMX is an anti piracy initiative to tap the illegal downloading of songs currently being done in a host of mobile stores and loaded on mobile chips. It was when we conducted around 500 raids that we realised that there is rampant mobile chip piracy prevalent in the market which might further drain the music industry and affect us with respect to consumption of content.

MMX is both an anti piracy and business approach where illegal mobile stores can become legitimate by opting for a MMX licence from the rights holders and sell music without violating the Copyright Act.

What would be the tariff for procuring the MMX license?

The license can be obtained for a period of one to three years at a minimal cost which ranges from Rs 1,500- 5,000 per month/per computer, depending on the kind of shop and location of the shop. An independent survey conducted by us indicates that an average shopkeeper earns Rs 7,500-12,500 each month via music downloads and other music applications, thus making the license fee a reasonable amount and a profitable business for the shop owners  We would be first introducing it at a pedestrian level and then at kiosk level and broadband level. The music industry of India loses more than Rs three billion each year, only through mobile chip piracy.

What is the total extent of music piracy in India?

The music industry's annual revenue stands at around Rs six billion, because it loses around Rs 14.5 billion to piracy every year. Out of this, physical music piracy alone accounts for Rs six billion, mobile chip piracy around Rs three billion, outdoor events without the requisite license costs us around Rs two billion, radio stations Rs one billion and TV and the Internet cost us Rs 1.5 billion.

Where does India stand as a consumer of music in the world?

We are in the fifth position in terms of music consumption after the US, Japan, Britain and France. Though we are among the top five in terms of music consumption, the value to the industry is only around 34 per cent.

The radio industry has been demanding rationalisation of music royalties. What is your take on this?

There are varied differences between the music industry and the radio industry and they need to be bridged. The music industry is not party to their profitability, we are the input cost. They should realise that music is their input cost and if they don't hesitate to pay for RJs, setting up towers and offices in plush areas, they can pay royalties too. Music is not a cost that is variable according to their profits and losses.

Has the Copyright Board been effective in attempting to resolve the impasse?

The radio industry was supposed to submit their arguments by 31 March but they didn't fulfill the criteria, so the Copyright Board has extended the time limit by another month. After that, the music industry will respond to their claims. The Board is keen to sort the impending issues between the industries and the hearings will start by July.

The current rate of Rs 660 was decided way back in 2002, which needs to be revised. We are insisting on a rate of Rs 2400 per hour or 20 per cent of revenues whichever is higher. We believe in legal procedures and hope the Copyright Board comes up with a fair decision acceptable to both the parties.

A few lyricists and composers have alleged that the IMI's licensing arm IPRS (Indian Performing Rights Society) hasn't paid them any royalties for the past four years.Comment.

Our basic approach as far as licensing societies are concerned is to pay the royalty to the owner of the copyright. It is not our business to find out who the owners are. The judgment of 1997 stated that the first copyright owners of music in a film is the producer, the producer further passes it to the music companies. We are very clear in giving the royalties to whoever is the owner. Those complaining can prove their ownership and demand their dues from the music labels. We are collecting royalties at the behest of the music labels and they can further distribute it to the composers and lyricists.

How do you plan to increase the coverage of your licensing wing PPL (Phonographic Performance Limited) to the interiors of the country?

We are planning a state wise approach to cover the interiors of the country. The PPL has over 85 people on its staff, and the IPRS has around 50. We reached a figure of 20,000 licenses last year and the plan for 2009-10 is to increase that to around 30,000.

What is the IMI's focus for 2009?

Our revenues this year have gone up by 40 per cent. We would continue with the copyright compliance regime and focus on monetisation. The consumption of music has grown multi fold over the years in different ways but the monetisation is not growing at the same rate and the owners are not getting their due returns. Our main focus would be to check areas where pilferage is happening and legitimise the illegal sources. There is a need for a critical number of raids to curb piracy. From the current 3,500-4, 000 a year raids the IMI conducts, we intend to increase it to 5,000 this year to create better impact.