WHY LISTENERS PAY ROYALTIES

Radio Record, Volume I, Issue 25, 6 January 1928, Page 2

WHY LISTENERS PAY ROYALTIES

THE AUSTRALIAN POSITION, "Yhe writer was recently asked, "What are these royalties we hear so _waguch about in broadcasting circles?’ Xt is possible that others are equally . puzzled about the matter, and it will not be inopportune to discuss the subject," says Roy Dio, in referring to the position in Australia, "A royalty, of course, is a payment made by the user to the owner of some device or work. The payment may be demanded in respect of the use of 8 book, a song, or some constituent part of a wireless set. It is the lastnamed item that interested my friend, and which we will consider’ for a while. : }

EVERY LISTENER PAYS. "Although he may not be aware of it, every listener pays royalty to the owners or agents of the owners of certain wireless patents, even if the listener’s set is a simple erystal set, which contains no patented device or xsethod; but it is actually the broadcasting company that pays the royality finally, after the listeners’ fees have been given to the company by the Government, "The broadcasting company is obliged to make some payment to the patent owners-Amalgamated Wireless Company-for the right to broadcast. Becanse in the broadcasting station até some patented devices or systems, the wireless company claims tribute from the broadcasting company in the form of so much per listener every year, no matter whether the listener uses a crystal or a valve set.

"That is the point that puzzles nny people: why pay on a crystal set? They can understand having to pay something for using a vaive set, because valves are patented. The answer is that. the listener when he tunes in YLO, Melbourne, or any other station, makés some use of, or receives some benefit, from the transmitting eguipment at the station, And the broadcasting company owning or operating the station is required to hand over to Amalgamated Wireless Company, the owners of the patent coveriny transmission, a certain portion of the listeners’. license fee. WIRELESS FRADERS ALSO PAY. "Until the new agreement between the Government and Amalgamated |

Wireless Company becomes law, every person or firm that sells valye receivers is liable to pay royalty to the wireless company; and, ote supposes, the trader passes on the charge to the purchaser,: ‘hus the listener who uses a valve receiver. pays royalty twice, _ "7 . "It is mot certain if the traders did pay that royalty: some of them took the stand that their sets did not in. clude devices or systems over which the wireless company had any valid patent rights. ‘That contention is the subject of pending litigation, and was the subject of much comment and -evidence before the Royal Commission. "When the new agreement becomes law-this month, some time, one may imagine-the traders will no longer be required to pay this valve socket royalty. Amalgamated Wireless will get One pavment every vear only: that

1s, from every listener. Out of the license fee an amount of 3s. will be deducted by the Government and handed to Amalgamated Wireless; and as there are over 250,000 licenses now in existence; the 3s, per license amounts to over £37,500 per annum. ‘The patents owned by the company have a limited life-generally for a few years -~and as some of the most vita! pat--ents are near the end of their life, presumably there will be an alteration in the amount paid by listeners in a few years’ time."