"Everybody but radio pays." That was the quote of Tennessee Congresswoman Marsha Blackburn. That's her justification for a new royalty that would be imposed on the radio industry. They call it a Performance Royalty, and it would pay labels, artists, and musicians. The problem is that radio is already paying a Performance Royalty. It's paid to Performance Rights Organizations. You know them as BMI, ASCAP, and SESAC. The radio industry negotiates directly with those organization, and has been paying them for 85 years. Unfortunately, none of that money is passed on to other people in the music industry. That's not our problem. But we pay billions of dollars to "the creators of the music," exactly as Blackburn states.
Fifteen years ago, Congress passed the Digital Millennium Copyright Act. This law was to handle digital royalties for the emerging digital world. The music industry said at the time that broadcasting music over the digital airwaves would allow users to make CD quality copies of their music. So Congress built in a special royalty that would compensate them for losses. It was a rare moment when Congress actually anticipated reality. Today, most people stream their music over the digital super highway. That includes Pandora, Sirius, and IHeartRadio. The broadcasting industry pays the music royalty for its digital streams, like everyone else. So in fact, radio DOES pay, just like everyone else. In an apples-to-apples comparison, radio pays.
What Blackburn is doing is making an apples-to-potatoes comparison. Broadcast radio is not digital. The Congress has forbidden broadcast radio from joining other digital transmission systems, like cable, internet, satellite, and even broadcast TV. People are not stealing music from OTA radio. They're stealing it from the internet. The internet royalty is fair, and the broadcasting industry pays it, just like everyone else.
The music industry sees radio as a partner, not as an adversary. In fact, several labels have actually signed revenue sharing agreements with some broadcasters. No one wants to see record labels suffer. We CAN work together. But the RIAA and Marsha Blackburn don't like that. Why? Because the agreements are actually fairer than the one they want. Broadcasters have also supported the Internet Fairness Act, that would level the royalty rates so everyone pays the same. Blackburn didn't support that Act, and it quietly died last year.
The only company that is affected by Blackburn's legislation is CBS. They're the biggest radio owner that also owns TV, and they're active in the retransmission fight. The rest of the radio industry, for the most part, doesn't care about retransmission rights. So what Blackburn's proposal unwittingly does is it causes CBS to negotiate directly with record labels, as Clear Channel has already done. Perhaps that's enough for Blackburn, but if CBS sells its radio stations, the whole discussion will be moot.
If Blackburn and the music industry want a new royalty, the blueprint already exists. It has the support of the broadcasting industry. Rather than resorting to another big government program, simply allow labels and broadcasters to negotiate directly. Keep big government out of the music business.
Fifteen years ago, Congress passed the Digital Millennium Copyright Act. This law was to handle digital royalties for the emerging digital world. The music industry said at the time that broadcasting music over the digital airwaves would allow users to make CD quality copies of their music. So Congress built in a special royalty that would compensate them for losses. It was a rare moment when Congress actually anticipated reality. Today, most people stream their music over the digital super highway. That includes Pandora, Sirius, and IHeartRadio. The broadcasting industry pays the music royalty for its digital streams, like everyone else. So in fact, radio DOES pay, just like everyone else. In an apples-to-apples comparison, radio pays.
What Blackburn is doing is making an apples-to-potatoes comparison. Broadcast radio is not digital. The Congress has forbidden broadcast radio from joining other digital transmission systems, like cable, internet, satellite, and even broadcast TV. People are not stealing music from OTA radio. They're stealing it from the internet. The internet royalty is fair, and the broadcasting industry pays it, just like everyone else.
The music industry sees radio as a partner, not as an adversary. In fact, several labels have actually signed revenue sharing agreements with some broadcasters. No one wants to see record labels suffer. We CAN work together. But the RIAA and Marsha Blackburn don't like that. Why? Because the agreements are actually fairer than the one they want. Broadcasters have also supported the Internet Fairness Act, that would level the royalty rates so everyone pays the same. Blackburn didn't support that Act, and it quietly died last year.
The only company that is affected by Blackburn's legislation is CBS. They're the biggest radio owner that also owns TV, and they're active in the retransmission fight. The rest of the radio industry, for the most part, doesn't care about retransmission rights. So what Blackburn's proposal unwittingly does is it causes CBS to negotiate directly with record labels, as Clear Channel has already done. Perhaps that's enough for Blackburn, but if CBS sells its radio stations, the whole discussion will be moot.
If Blackburn and the music industry want a new royalty, the blueprint already exists. It has the support of the broadcasting industry. Rather than resorting to another big government program, simply allow labels and broadcasters to negotiate directly. Keep big government out of the music business.
Last edited:
