Jerrold Nadler (D-NY) is introducing a bill which would slap an interim performance royalty on AM and FM radio attached to their streaming content until such time as a royalty is attached to actual airplay. Needless to say, there are two bodies of opinion on this matter.
MusicFIRST Coalition Executive Director Ted Kalo weighed in with the opinion of the recording industry: “The members of the musicFIRST Coalition are thankful that Congressman Nadler has reintroduced the issue of Performance Rights with this draft legislation. This is an issue of fundamental economic justice that will not go away. The only real solution is for Congress to create a legal performance right, but raising terrestrial radio’s digital royalties is an important interim step towards that goal. By effectively reimbursing performers for lost income, Rep. Nadler’s draft legislation recognizes the injustice of denying fair pay for airplay. We also appreciate Rep. Nadler’s thoughtful proposal on the issue of platform parity. Rather than start a race to the bottom in digital radio royalties that would devastate artists, the discussion draft proposes a 21st Century marketplace standard that treats artists and platforms fairly and equally.”
Responding on behalf of broadcasters was Cathy Rought of the Free Radio Alliance: “Free, local radio promotes artists, supports hundreds of thousands of local jobs and gives back to communities across the country. The draft legislation proposed by Congressman Nadler is misguided and would cause irreversible harm to free and local radio. This type of government interference runs contrary to the evidence that free market negotiations can and do work. That’s why nearly 200 House and Senate members oppose any imposition of a congressionally-mandated performance tax.”
RBR-TVBR observation: We have the private royalty bill between Clear Channel and Big Machine. Is it possible at some point that we might start seeing the reverse? A radio group will offer airplay to qualified artists who waive royalties? Those would be the artists who understand the value of marketing and realize that there is immense value to be had from the exposure their music gets via radio.
We always thought the system worked just fine – artists create music, radio plays music, fans buy music, fans are entertained while radio and artists make money. And it still works!