California reps move to preempt FM phone chip


Darrell Issa (R-CA) and Anna Eshoo (D-CA) have teamed together to introduce a House of Representatives Resolution that would discourage the imposition of production mandates on consumer electronics manufacturers. It takes direct aim at radio, urging Congress to resist FM chips on cell phones and support bringing an end the radio performance royalty exception.

Issa is in on the resolution due to his membership on the Judiciary Committee, and Eshoo is in on it because of her seat in Energy and Commerce. Issa is also Chair of the Oversight Committee, and Eshoo is Ranking Member of the Communications Subcommittee.

The piece of House business is called the Creativity and Innovation Resolution (H. Con. Res. 42). It asks Congress to “Protect all Americans who create intellectual property and foster an economic environment that encourages American performers, creators, and innovators to take the artistic risks necessary in their careers to make quality work and spur the economy; and oppose any mandate for the inclusion of terrestrial broadcast radio tuners in the manufacture or sale of mobile devices.”

Issa commented, “America is synonymous with out-of-the-box thinking and creative entrepreneurialism. Case in point, our recording industry. Talented artists and performers create original work here and we’ve seen, time-and-again, that their investment yields returns in the form of economic activity and jobs for thousands. Intellectual property creators should not have to fear the threat of government mandates becoming an additional hurdle to their success.”

Eshoo added, “Consumers deserve to enjoy the technology that’s most appropriate to them. The Creativity and Innovation Resolution simply says the government will not mandate specific technology that limits the way consumers listen to local news, information, and music.”

Issa took the occasion to remind everybody that he was a co-sponsor of the Performance Rights Act, which failed to make it out of the 111th Congress and which has not as yet resurfaced in the 112th.

Leaders of a number of organizations joined in celebrating the introduction of the resolution, including execs at NARAS, CTIA, CEA and RIAA.

“The music community wants to see the growth of distribution platforms that compensate musicians and performers. The most exciting new mobile devices are also the distribution platforms that fully compensate musicians and performers. FM Radio, by contrast, does not,” said Neil Portnow, president of the National Academy of Recording Arts and Sciences, The Recording Academy®, after completing last week’s “Grammys on the Hill” advocacy day.

“With more than 650 unique wireless devices in the U.S., consumers have a variety of options, including handsets with FM chips. The hallmark of our industry is one that offers consumers numerous choices so they can customize their wireless experiences, through innovative streaming music services such as Pandora or downloading an indie artist’s app,” said Steve Largent, president and CEO of CTIA-The Wireless Association.

“An FM chip mandate is unnecessary and unjustified. These new mobile devices are platforms for innovation and creativity, and Americans can decide for themselves what functions and features they want. Requiring today’s digital phones to include an analog FM Chip makes as much sense as requiring them to include a telegraph,” said Gary Shapiro, president and CEO of the Consumers Electronics Association.

“Every platform in the industrialized world respects property rights but one – terrestrial radio in the U.S. So the idea of the government rigging the playing field to expand the scope of the existing taking makes zero sense. That’s why we welcome this resolution and the broader concept of policies that reward technical and creative innovation,” added Mitch Bainwol, Chairman and CEO of the Recording Industry Association of America.

RBR-TVBR observation: We understand why representatives of the manufacturing community would oppose this – they have always been a third party drawn into a dispute between radio and the labels. But the race of the labels to damage radio, their primary marketing partners, remains a mystery.

Well, not a mystery exactly – they are still reeling from the damage to their business model inflicted by the internet. But rather than learn to live within the new realities imposed by today’s technological environment, they are simply looking to radio to solve part of their cashflow problem.

The facts are very simple. It is very difficult to sell music if people haven’t heard it. Radio remains the primary way that new music reaches the public. Labels to this day clamor for airplay. They are fully aware that airplay equals income. So what they are trying to do is get radio to market their product for them and at the same time pay for the privilege. That’s just crazy.