Seth Miller of the Total Traffic Network, writing an opinion piece for RTNDA, worked his way through the various arguments for and against the Performance Rights Act, from the perspective of a news radio professional. His conclusion: If PRA passes, everybody loses.
He said that the bill does seem to fail to consider the true monetary value that free airplay of music imparts to the music industry. Therefore, while the performance payment may initially funnel some radio money to labels and some musicians, eventually it will make music-based formats as expensive to produce as news formats traditionally are.
Therefore, it is but a temporary fix for the labels, giving them a short-term infusion of cash that will disappear as radio stations exit music-based formats in favor of news-talk offerings.
Miller didn’t mention it, but he doesn’t need to – that would be very bad news for the stations already in news-talk formats – and of course, it would be no bed of roses for the stations exiting the music world trying to take on entrenched predecessors in spoken-word-based formats.
And of course, the lack of music exposure will then take yet another bite out of the recording industry’s income potential.
“For those of us in news, particularly in broadcasting, it’s easy to see how a performance tax could result in expedited layoffs,” concluded Miller. “Simply put, a performance tax takes assets away from the American radio industry and supplants them in the music industry. What some people in the music industry are failing to realize, though, is that would only be a temporary financial fix. If broadcasters can’t afford to play music, both industries suffer. The performance tax is not good for anybody.”
RBR-TVBR observation: This is the first time we’ve heard this galaxy in the universe of unintended consequences of PRA mentioned, but it’s true. Like most journalism outfits, radio newswers are challenged already without a sudden influx of music-fleeing direct competitors.
There’s nothing cheap about doing radio news at the local level, but RIAA may drive more and more stations to try it. More, probably, than the market will bear, making it harder and harder for the stations that are really good at it to continue to make a solid living.
It will force stations in the format to look for shortcuts, and lower rates, and rely on news service rip-and-read tactics, and resort to sensationalism, and engage in any number of other tactics designed for base survival rather than journalistic excellence.
But let’s look at the upside – people like Britney Spears and label execs who live somewhere in Japan will be very pleased that people like Patrick Leahy (D-VT), Orrin Hatch (R-UT), John Conyers (D-MI) and Darrel Issa (R-CA) are looking out for their interests at the expense of local radio stations – both local music AND news stations.