The San Jose Mercury News published an opinion column spelling out the case against adding a performance royalty to the obligations already heaped on broadcasters. The practice was fingered as a ploy by record companies to develop their own alternative source of income on the backs of broadcasters and their listeners. Admittedly, the piece would be impressive if it had been written by somebody other than local Clear Channel market manager Dave Pugh of KFOX 98.5 and KSJO 92.3, but regardless of the source, it did effectively put forth the broadcaster side of this issue. Pugh notes how the added expense will go more to corporations than to artists, all while reducing the operating room for broadcasters, forcing many totally out of music-based formats and others completely out of business. This despite the fact that the artists themselves are well aware of the benefit they derive from free airplay.
RBR/TVBR observation: This has always been a naked ploy by the labels to find a way to replace cashflow lost by their failure to pay any attention whatsoever to what the internet was doing to their business model. They know full well how important broadcast exposure is to the music business, and they’re perfectly willing to compound their recent errors by cutting off free promotion now. Pugh is right – we suspect that if it becomes too expensive to play music on a radio station, broadcasters will either talk – or treat music spins as a commercial and charge for them.