This deal lays down a template.

VIEWPOINT Adam Singer

Getting a settlement with the BPI is really terrific, because they are our natural other halves in the music sector, so it means at least we have a degree of music internal agreement. What has been a split industry on this issue can now act as one industry to explore and grow the online market.

What's important about this agreement is that it's going to lay down a template which clearly gives direction to what digital trading is going to be like in this new environment. With a template, everyone has certainty and certainty helps promote growth. This agreement sets an eight per cent rate with guaranteed minimum royalties applying. The record industry can therefore be certain about the rate and composers, songwriters and publishers can be certain about the minimum amounts they will receive.

Guaranteed minimum royalties are really important to us because they preserve value in a digital age; a digital age where increased supply will reduce barriers to entry and where price points will come under pressure.

It has taken us a while to get to where we are because the issues of rate and minimum royalties caused anxieties for the BPI and the Alliance. We are not normal commercial organisations. We are both representative organisations and when you put two swarms together you get a lot of buzzing.

That's essential for the process we've been going through. Both groups started off 15 months ago, saying, "Come on, if you think you're hard enough." And then what happens is you start having an exchange of information and, as the level of ...