Saga Communications CEO Ed Christian is well known for opposing the NAB’s position on the Performance Rights Act (PRA). He is not alone among broadcasters and in his quarterly Wall Street conference call Christian lashed out at the NAB for refusing to poll even its own members on its recently adopted PRA term sheet for a possible deal with musicFirst/RIAA.
Citing his long experience dealing with the Radio Music License Committee (RMLC), which negotiates with BMI and ASCAP, Christian questioned why the NAB would agree to, in his words, “gratuitously give away 1% of our revenues” while the RMLC is working to reduce composer/publisher music royalties. And the Saga CEO noted that the RMLC represents twice as many radio stations as the NAB and regularly polls the broadcasters it represents. Why then, he asked, doesn’t the NAB at least poll its 4,000 radio members, if not the entire industry? “If a lobbying organization or trade organization is representing their industry, they shouldn’t be afraid of doing so,” Christian said.
Without mentioning Entercom CEO David Field by name, Christian noted that another group head had recently stated that the proposed PRA term sheet would only cost his company a few million dollars annually. “As far as Saga goes, it’s a tax – a levy on my profits – and I have a fiduciary responsibility to shareholders to not gratuitously give away 1% of my net revenues,” Christian said. “Every million dollars that we are able to take and put into some other thing, such as debt paydown, makes us a healthier, stronger company and allows us to look at opportunities. It allows us to do stock buybacks and allows us to do everything else, rather than increase my cost of doing business,” he added.
RBR-TVBR observation: We have polled the industry, or at least those people in the industry who are our readers. In fact, we polled four times. Twice more than three-quarters of the respondents said NAB should oppose any Performance Royalty and not negotiate for a deal. Then a majority (over 55%) said negotiating now would not prevent a worse outcome for radio down the road. And most recently over 88% said there should be a radio industry vote before NAB accepts any PRA deal. Click here to see the poll results.
The bottom line is that the NAB has not done an effective job of selling the PRA negotiations and term sheet to its own members and, at this point, is not speaking for the radio industry when it sits across the table from musicFirst/RIAA.