Weighing in on royalties


ChatThe first hearing on internet royalties expanded to bring the entire audio royalty universe into play, and promises to be but the beginning of yet another protracted airing out of the topic. Here’s what some interested parties have to say about it:

* ASCAP, BMI, SESAC and the NSAI in joint letter on insufficient US royalties to Bob Goodlatte (R-VA) and Melvin Watt (D-NC): “This undervaluation of the public performing right runs contrary to global practices which often yield two times the fees generated by US license rates or more, when compared to equivalent economies, and represents a trend that is harmful to both America’s music creators and the larger economy. Any Congressional examination of online music licensing issues needs to address this serious, broader issue to ensure that the interests of writers and publishers – the very creative foundation fueling the music industry – are not further deteriorated.”

* Michael Petricone, Consumer Electronics Association: “Current law requires Internet radio companies to pay vastly more in royalties than other digital or over-the-air music sources. By imposing disproportionately high costs on Internet radio companies, the government is effectively picking winners and losers in the digital music marketplace. Unsurprisingly, the Internet streaming ecosystem is not healthy. Unjustifiably high royalty rates discourage new competitors and many Internet streaming companies have closed or left the industry. By rationalizing the royalty structure, the Internet Radio Fairness Act will stimulate investment in the internet music industry. That means more royalties for artists, more choices for consumers, and more exciting new products and services for Internet music. The current royalty system is unjustifiable, and changes proposed in the bill are common sense and long overdue. We urge Congress to vote for innovation and pass the Internet Radio Freedom Act as quickly as possible.”

* Ted Kalo, Executive Director of the musicFIRST coalition: “In the past week we’ve had Black Friday, Cyber Monday and Giving Tuesday. Today Pandora is hoping for Bailout Wednesday but that’s not on the calendar or in the cards. On the committee, this bill appears to have a lonely constituency of exactly one member.”

* Kurt Hanson, Radio and Internet Newsletter: “The current confusing mix of royalty-rate setting standards for digital radio is result of piecemeal legislation enacted as each new technology was invented. The result is a system significantly out-of-sync with the realities of the 21st century marketplace. It substantially hinders the growth of Internet radio businesses and platforms – and thus hurts consumers, musicians, and innovators. For the music industry particularly, I believe that a thriving Internet radio industry could be a godsend. Webcasters like Pandora, AccuRadio, and others are already giving significant and valuable amounts of airplay to dozens of genres of music (ranging from bluegrass to EDM), hundreds of independent record labels, and tens of thousands of artists that otherwise would be unable to use the power of radio exposure to build their fan bases.”