BBC Radio Cymru will be cuttings two hours a day from its schedule if an agreement cannot be reached with the new Welsh version of PRS.
Eos, the body representing the artists and the BBC are continuing talks today but if no deal can be made it means over 300 Welsh language musicians will not have their music played on the station.
Instead, programmes will start an hour later at 6:30pm and the station will close at 11pm. English music will be used to fill any gaps on the all-Welsh station.
BBC Wales says Eos is asking for 10 times the amount that is paid in the existing deal with PRS and has already turned down a substantial offer.
The dispute started when the Performing Rights Society made a change in 2007 which many Welsh language artists claim cut their royalty payments by as much as 85%.
Since then, a new agency called Eos was launched to handle the licensing of their work and comes into force on January 1st 2013.
Gwilym Morus, Chair of Eos told the BBC: “It’s a shame that the BBC have chosen to damage the national radio service because they are unwilling to pay a fair price for Welsh music.
“The last thing we want is to see any more harm done to Radio Cymru – our audience is the BBC audience.”
Sian Gwynedd, head of Welsh language programmes and services at BBC Cymru Wales: “This will clearly have a noticeable impact on the service we can deliver, but I would like to emphasise to our listeners that we are doing everything possible to protect the quality of our programming despite the difficult circumstances.”