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MTV Europe buries the hatchet with music labels

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MUMBAI: The imbroglio over fee payment between MTV Europe and independent record labels has been settled. The two parties arrived at an agreement that allows bands like The Strokes and The White Stripes to remain on the air.

In the end, it was the broadcaster that had to eat humble pie in the face of stiff resistance. A report in UPI stated that MTV signed an agreement with Video Performances limited, which represents 167 smaller labels to pay a fair value for the use of videos. Earlier MTV had asked that the royalty it pays be cut by 55 per cent. In retaliation the labels had threatened to boycott the broadcaster.

Putting on a brave face was MTV Europe president Brent Hansen who said that MTV Networks Europe was always the home of independent music and artists. He also indicated that the broadcaster was happy with the terms of the new deal. The old contract was worth $3.5 million and the new contract is said to be close in value. "We hope and trust that the principle of collective licensing, dear to the independent community, is now respected and upheld" he added.

MTV pays no royalties at all to independent labels in the US. Another report in the New York Times stated that to rectify the situation European trade groups would look to the US next. They plan to help local independent producers organise their efforts in order to force MTV and other music broadcasters pay royalties for using their music.

The report further noted that the independent labels invested firstly out of passion rather than profit. Therefore a lot of cutting edge sound comes from there. MTV US as expected brushed off the issue saying that the business model was different.

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