Mantovani Risk As Gyms Face Higher Music Cost

Sydney Morning Herald

Saturday April 5, 2008

Emily Dunn Entertainment Writer

FITNESS centres may be forced to find an alternative source of music for classes after an application by the Phonographic Performance Company of Australia to increase payments for recorded music.

The company, which represents the interests of recording artists and record labels, wants to increase the payment from 96.8 cents a class to $4.54 per month per member or $0.99 per casual visit offered by a commercial fitness centre.

The new rate will be determined after a Copyright Tribunal hearing later this year, with a decision expected next year.

The company's chief executive, Stephen Peach, said the rate was decided following extensive studies and would not affect non-profit fitness classes.

"Most fitness centres revolve around periodic memberships, which include fitness classes," Mr Peach said.

"We are focusing on the large profit-driven companies. We are simply seeking a fair return for labels and artists who create the music. That return should be in line with the value that music delivers to this booming sector."

Mark Forrest, a director of the Fitness First chain and a board member of the industry association Fitness Australia, said fitness centres would struggle to absorb the new costs if approved, and the industry was looking at other sources of music, not licensed by the Phonographic Performance Company of Australia. He reckoned the new rate would cost Fitness First $20 million a year. "You have a lot of members who don't participate in group exercise classes, which means the cost of running the facility will be increased dramatically."

Last year the the Phonographic Performance Company of Australia won an action requiring nightclubs to pay $1.05 per visitor. The fee had been seven cents.