PRA story goes mainstream


Everybody is putting their two cents in. Months have stretched into year while the radio industry and the recording industry have been duking it out over the Performance Rights Act, but unless you read the trades, you’d never know it. But suddenly, the story has graced the pages of the New York Times, the Washington Post and the Boston Globe.

A Stifel Nicolaus analyst told NYT that the fact that NAB has signaled that acceptance of a new royalty fee was negotiable represented “…a crack in the dam.” NYT noted a deal would include putting radio chips in cell phones, a plank that is not sitting well with the consumer electronics industry.

Boston Globe editorialized on the topic, saying that the chip/cell requirement smacked of Washington’s back rooms, and suggested that FM was “on its way out.” We’ll editorialize and note that the Globe’s opinion will likely come as news to the many millions of Americans who tune into FM every day.

WaPo’s report had unusual depth for a mainstream look at an inside-baseball topic. Take this observation about CRB: “The issue should be familiar to politically-aware Web-radio fans: the disproportionate royalties that those sites pay to the musicians whose work they stream over the Internet. A flawed political process resulted in a panel of judges setting punitively high rates that would have put many Webcasters out of business, and even the more reasonable rates negotiated last year are substantially higher than those that the XM Sirius satellite-radio firm owes, and infinitely higher than those that AM and FM stations pay.”

However, discussing the value of on-air promotion of music, WaPo’s article does not understand the distinction between performer and composer (performers have ways to benefit from airplay, like selling tickets, paraphernalia, etc.) that are unavailable to composers. It also takes radio to task for desiring chips in cell phones. The same Stifel, Nicolaus analyst who spoke with NYT told WaPo that a chip mandate might kill a deal on the Hill.

NAB’s Dennis Wharton told WaPo about the public interest benefits of the chip proposal, calling radio on cells an “unparalleled lifeline service available instantaneously in times of emergency.” He said it would it was a must to get NAB agreement on any deal with musicFirst/RIAA.

RBR-TVBR note: See RBR-TVBR Exclusive: Cell phones might sell Radio on PRA this report explains the value to all parties involved.