PRS for Music has halved its rate for music streaming and upped royalties for artists.

The Performing Rights Society (PRS) for Music has slashed its rate for music streaming by over half, from 0.22p to 0.085p.

Companies wishing to play or stream music over the internet are legally obliged to pay royalties to the artist, as per the Copyright, Designs and Patents Act 1988, and in the past the rate has been claimed as prohibitive.

Earlier this year, YouTube started removing access to premium music videos for UK users after failing to reach a new licensing agreement with the PRS.

The new rates for streaming services for its new Online Music Licences were approved by the PRS for Music board on 20 May, and come into effect on 1 July, after an extensive seven month consultation period with key stakeholders, major & independent music publishers and the wider industry.

For on-demand streaming services, the headline royalty rate will increase from 8% to 10.5% of revenue in exchange for the per stream minimum being reduced from 0.22p (£0.0022) to 0.085p (£0.00085) – these will apply for three years.

Andrew Shaw, Managing Director of Broadcast and Online at PRS for Music, said: “We believe these new streaming rates will stimulate growth in the digital music market and will benefit our licensees and our members.

“As new entrants join the market and existing providers expand, music creators will reap the rewards by sharing in the success that their talent is generating. This is a good deal for music creators and for music lovers.”

YouTube has issued a statement on the back of this news: “We welcome any efforts to make licensing costs more realistic, but as we’re still in discussions with the PRS to agree license terms for YouTube we’re unable to comment further.”

For more information, visit PRS for Music.