HD Radio may be paying new royalty fees !

[PocketRadio]

"Record Industry wants royalty for AM/FM to offset sales slump" Ref. L.A. Times

“For record labels and musicians, addressing the issue now is crucial because digital radio, now being rolled out, allows broadcasters to split a signal into several digital channels and play even more music exempt from performance royalties. The U.S. Copyright Office has long supported removing the exemption. The groups have a major ally in Rep. Howard L. Berman (D-CA), who now chairs the House subcommittee dealing with intellectual property law. Berman is ‘actively contemplating’ leading a legislative push to end the exemption."

http://tinyurl.com/2w9qk9

"New Copyright Maximalist Group Neutered From the Start"

"Broadcasters are exempt from those royalties both for their analog and new digital “HD” radio services. We have said that treating different radio services differently in this context is unfair. To the extent that this exemption might have been justified at one time because of the promotional value of broadcast radio airplay, today that value is no different if the radio service is delivered via satellite or the Internet... But scroll down the list of members, and there you see – surprise – the National Association of Broadcasters, which is a virulent opponent of repealing the exemption (they also oppose the radio broadcast flag, which is something else the recording industry would like Congress to enact)."

http://www.publicknowledge.org/node/957

A final nail-in-the-coffin for an already dead technology ?

 

[Mike Walker]

Radio stations pay THE SONGWRITERS (ASCAP AND BMI), which is something NOBODY ELSE DOES! We've "paid at the office", and then some! Try selling your music without airplay!

Exempt means EXEMPT! Something that hasn't happened, and won't, ain't a nail in anything!

 

[PocketRadio]

Exempt means EXEMPT! Something that hasn't happened, and won't, ain't a nail in anything!

Not any more - looks like that may change, and your comments aren't going to make HD royalty fees go away !

 

[dbdigital]

Exempt means EXEMPT! Something that hasn't happened, and won't, ain't a nail in anything!

Not any more - looks like that may change, and your comments aren't going to make HD royalty fees go away !

There's an interesting mathematical analysis provided by Radio and Music of what it would mean if terrestrial radio were forced to pay performance royalties at the same rate as the new CRB rates for webcasters. The upshot is that it would basically cost broadcasters over 11% of their total revenue. Data shows that the radio industry averages less than 11% in net revenue.

So it would essentially bankrupt terrestrial radio.

http://radioandmusic.blogspot.com/

db

 

[Chuck]

There's an interesting mathematical analysis provided by Radio and Music of what it would mean if terrestrial radio were forced to pay performance royalties at the same rate as the new CRB rates for webcasters. The upshot is that it would basically cost broadcasters over 11% of their total revenue. Data shows that the radio industry averages less than 11% in net revenue.

So it would essentially bankrupt terrestrial radio.

http://radioandmusic.blogspot.com/

db

If it were ever enforced, I think you would find that talk radio really folurished. They'd also have to enforce it on TV which you may notice is also digital these days. I don't think that will happen.

It would be a very stupid move on the part of RIAA, since conventional broadcasting is still one of the main ways that people are exposed to new music.

 

[SUPERCASTER]

Radio stations pay THE SONGWRITERS (ASCAP AND BMI), which is something NOBODY ELSE DOES! We've "paid at the office", and then some! Try selling your music without airplay!

Exempt means EXEMPT! Something that hasn't happened, and won't, ain't a nail in anything!

Wrong again Mike.
Webcasters, podcasters, satellite, cable, TV, etc., are all liable for ASCAP, BMI, SESAC, as well as Sound Exchange!

Music exposure and "airplay" are now available from many sources besides over the air AM and FM broadcasts.
"Broadcasting" has in the past mostly referred to AM or FM but now includes many delivery systems besides just AM and FM. The AM and FM monopoly on the word "broadcasting" no longer exists, and has not for years.

There is no rational reason why AM and FM stations should be exempt from Sound exchange.

 

[SUPERCASTER]

TV is not yet paying for Sound Exchange, but it is for ASCAP, BMI and SESAC.

 

[clouseau]

There is no rational reason why AM and FM stations should be exempt from Sound exchange.

Actually SC, I can think of a few, but here's a thought. Why does ANYONE pay Sound Exchange? Is the "Promotional airplay for free" model REALLY broken?

<Personal opinion mode = ON>

What moron decided that "Digital" somehow equals "Copy".

Hey buddy I got your Real Audio 1.0 14.4KPS copy right here. These folks have GOT to be kidding me.

The recording industry profit model is broken. REAL broken. And it's not going to get fixed by jacking up radio (Or webcasting or "Digital anything")

If radio should be paying for records then why are they getting jammed for payola by the Feds?

If record companies don't need promotion, why do they offer Music service to Club DJ's. (Yes in some markets they do).

If record companies don't need radio then why do they furnish so many prizes for stations in modest markets? (Believe it)

If record companies don't need radio then why do PD's and MD's of stations in even medium markets go to conventions on the record companies tab? (All the time)

If record companies don't need radio then why do Indy promoters just seem to gush cash sometimes??

The RIAA needs a competitor. The RIAA needs a business plan.

IMHO,

THE RIAA IS LOOKING FOR A REVENUE SOURCE BECAUSE THEY ARE LOST!!!

Radio's deal should be "THE" deal. For everyone. (IMHO)

<Personal opinion mode = OFF>

Clouseau

 

[SUPERCASTER]

I am not supporting Sound Exchange, I simply said there is no reason to treat over the air AM-FM broadcasting or HD Radio any different then any other method of audio distribution.

Digital does not necessarily equal archived download, internet streaming is an example of ethereal one time play. Yes, it can be recorded for repeated playback just as AM and FM broadcasts, but is not archived by end users most of the time.

Sound Exchange claimed to be created to support performance royalties for performing artists. Instead, it seems, payments are mostly made to record companies.

Clubs and other public performances are also subject to royalty payments (sorry Mike, not only radio stations pay).

If illegal payola to radio stations from large record company conglomerates is the best example for continuing the present system then I submit your argument is flawed.

Most independent record labels and artists are at a serious disadvantage with the present illegal pay-for-play payola promotion system, crippling creativity, exposure, and new talent.

Yes, it is time for badly needed reform, but vested interests are preventing any substantial changes that are not to their benefit.

 

[clouseau]

If illegal payola to radio stations from large record company conglomerates is the best example for continuing the present system then I submit your argument is flawed.

Most independent record labels and artists are at a serious disadvantage with the present illegal pay-for-play payola promotion system, crippling creativity, exposure, and new talent.

Yes, it is time for badly needed reform, but vested interests are preventing any substantial changes that are not to their benefit.

Remember that "Pay for Play" is legal. Only the "Lack of disclosure" is a problem. Many stations play 90 second "Spots" overnight which contain 90 seconds of a particular song. It gets picked up by BDS a Ta Da! A "Spin" is created.

My point was simply this. The record companies need radio. (Frankly, I think the record companies need other media too) Without the promotion, NO ONE BUYS THEIR STUFF.

That's happening now. Not enough people are buying their stuff. And their wonder child solution is to basically jack up Radio, TV and webcasters and sue consumers for sharing. Meanwhile, IMHO, the biggest problem they have is the unwillingness of the public to buy a whole album for $16.

This is a draconian example, but if it was made illegal to play RIAA music on the radio or TV do you think we would still have viable radio and TV?

Would we have viable RIAA record companies?

These RIAA folks need a plan, IMHO. So far, I havent' seen one.

Clouseau

 

[radiopilot]

If illegal payola to radio stations from large record company conglomerates is the best example for continuing the present system then I submit your argument is flawed.

Most independent record labels and artists are at a serious disadvantage with the present illegal pay-for-play payola promotion system, crippling creativity, exposure, and new talent.

Yes, it is time for badly needed reform, but vested interests are preventing any substantial changes that are not to their benefit.

Remember that "Pay for Play" is legal. Only the "Lack of disclosure" is a problem. Many stations play 90 second "Spots" overnight which contain 90 seconds of a particular song. It gets picked up by BDS a Ta Da! A "Spin" is created.

My point was simply this. The record companies need radio. (Frankly, I think the record companies need other media too) Without the promotion, NO ONE BUYS THEIR STUFF.

That's happening now. Not enough people are buying their stuff. And their wonder child solution is to basically jack up Radio, TV and webcasters and sue consumers for sharing. Meanwhile, IMHO, the biggest problem they have is the unwillingness of the public to buy a whole album for $16.

This is a draconian example, but if it was made illegal to play RIAA music on the radio or TV do you think we would still have viable radio and TV?

Would we have viable RIAA record companies?

These RIAA folks need a plan, IMHO. So far, I havent' seen one.

Clouseau

"These RIAA folks need a plan, IMHO. So far, I havent' seen one."

I think they have their plan already... I think they know not many are listening to radio and they believe internet and other forms of listening are cutting into their profits and wnat as much revenue as they can muster.. if it means charging terrestrial radio more fees than so be it...

So basically radio stations must have a different system of paying compared to satelite, internet, or other means of royalties form the music industry simply because they were first in playing music over the air?
I think if they want to charge internet and other forms of music for airplay, then terrestrial radio have to pay also regardless if it means the viability of the radio stations demise or profitablity... why not, aren't alot of webcasters going out of business soon because of these fees?

Radiopilot

 

[Tom Wells]

There was an ASCAP flap in in 1939 or so, and only BMI records received airplay for a while.

I seem to recall reading it was painful for all parties involved.
Does anyone remember more details about this?

The equating of airplay= copy happens every time a new recording medium is available to consumers.

The notion that consumers are able to make undegraded copies from radio regularly is laughable.
Some can. Most cannot.

The degradation of any broadcast, and the other audio elements of radio were always considered enough
to make purchasing the music "necessary" for a listener who really liked a song, unless they really liked airchecks.

Now that music is being sold in a format with no physical substance, there is even less for the record companies to beef about.
Bring back a format that does not die as easily as CDs, and maybe they'll regain sales.

 

[radiopilot]

There was an ASCAP flap in in 1939 or so, and only BMI records received airplay for a while.

I seem to recall reading it was painful for all parties involved.
Does anyone remember more details about this?

The equating of airplay= copy happens every time a new recording medium is available to consumers.

The notion that consumers are able to make undegraded copies from radio regularly is laughable.
Some can. Most cannot.

The degradation of any broadcast, and the other audio elements of radio were always considered enough
to make purchasing the music "necessary" for a listener who really liked a song, unless they really liked airchecks.

Now that music is being sold in a format with no physical substance, there is even less for the record companies to beef about.
Bring back a format that does not die as easily as CDs, and maybe they'll regain sales.

Radio broadcasters have always fought paying the fees to the music industry:

https://www.ascap.com/about/history/1940s.html

As you noticed they gave into the fees because the musicians with the top hits of the time were ASCAP members, otherwise who would have been on the air then?

I don't know about recording 'off the air' music, but there are actually excellent recordings that one can actually record off the air and have high quality almost 'cd' like, enough for the RIAA to charge you for this, now that HD FM is near CD quality better than some say of internet webcast, they should pay RIAA the fees since people WILL record this music to add to their Ipods, mp3 players, etc.

ITunes and many other 'web' based music exchanges are the means to add this extra income to recording industries and yet they 'recording industry' are going to be the ones killing off their honey basket because of their greed!

Radiopilot

 

[Chuck]

Meanwhile, IMHO, the biggest problem they have is the unwillingness of the public to buy a whole album for $16.

That's the problem in a nutshell. Most people know that a blank CD costs about 30 cents, and a lot less in large quantities. Even though there examples of artists who are grossly overpaid, most aren't. The profit (and here is lots of it) goes to the record companies. The public knows that, and doesn't seem to be buying it. Further the record companies need to learn to make money out of new media delivery systems, not try to fight them, insisting on business as usual. It is a lot easier to swim with the tide.

 

[Mike Walker]

Radio SHOULD fight fees. WE SELL THEIR FREAKIN' RECORDS FOR US! Don't believe it? Why are they so willing to offer payola "off the record"?

93 percent of Americans listen to AM or FM radio EVERY WEEK. Virtually the same as a decade ago (though time spent listening IS down...with ALL media, because there's MORE MEDIA!)

Tom's right...there was a flap over music fees. BMI was formed BY BROADCASTERS to avoid paying ASCAP's outrageous fees. But we're really talking apples and oranges here. The RIAA has NOTHING to do with radio fees. They deal with fees based upon SALES, on web streams, etc. Radio stations pay NOTHING based upon sales. We pay SONGWRITERS. In fact, THAT IS HOW THEY GET THEIR MONEY!

 

[Tom Wells]

Meanwhile, IMHO, the biggest problem they have is the unwillingness of the public to buy a whole album for $16.

That's the problem in a nutshell. Most people know that a blank CD costs about 30 cents, and a lot less in large quantities. Even though there examples of artists who are grossly overpaid, most aren't. The profit (and here is lots of it) goes to the record companies. The public knows that, and doesn't seem to be buying it. Further the record companies need to learn to make money out of new media delivery systems, not try to fight them, insisting on business as usual. It is a lot easier to swim with the tide.

CDs were never introduced to make music sound better, only to eliminate the high-cost precision steps in making records.
As usual, the marketers lied about the technical aspects to further the truth of the great lie.
The record companies might have deserved more money at one time, but since they now deliver an inferior product
for the same price they used to charge for the far more durable product with higher resolution.

CD's durability is not at all assured, and as the substrate inside oxidizes and/or scratches occur, the data is unrecoverable.
I have records nearing 100 years old which still play just fine.
When I spend money for copyrighted material, I am loathe to spend it on a book printed on high acid content newsprint or a CD which is
not likely to last nearly as long as newsprint.

 

[clouseau]

Radio SHOULD fight fees. WE SELL THEIR FREAKIN' RECORDS FOR US! Don't believe it? Why are they so willing to offer payola "off the record"?

93 percent of Americans listen to AM or FM radio EVERY WEEK. Virtually the same as a decade ago (though time spent listening IS down...with ALL media, because there's MORE MEDIA!)

Tom's right...there was a flap over music fees. BMI was formed BY BROADCASTERS to avoid paying ASCAP's outrageous fees. But we're really talking apples and oranges here. The RIAA has NOTHING to do with radio fees. They deal with fees based upon SALES, on web streams, etc. Radio stations pay NOTHING based upon sales. We pay SONGWRITERS. In fact, THAT IS HOW THEY GET THEIR MONEY!

As a hypothetical, Let's assume radio stoped playing RIAA music.

What would happen? Here's what I think.

1) Someone besides the RIAA (Or a "Maverick" Co. IN the RIAA) would be doing music "Free for airplay" in about 2.3 seconds. The number 11 record company will view this as the opportunity of a lifetime. I think there's RIAA solidarity until there's more opportunity WITHOUT RIAA solidarity for RIAA members.

2) Radio "Quality" would suffer. A lot. Then again, CLEAR CHANNEL RECORDS would probably be able to take up some of the slack. I suspect the Contemporary Christian format would operate outside of this as well to a great extent. Classical would be able to get a pass, too I'll bet.

3) TV would have a lot more of the mass music exposure than there is now. This because "Performances" would not be subject to RIAA fees, only Recordings "CREATED" by the RIAA. Radio also might be able to avail itself of some of these NON-RIAA live appearances. (Maybe even recordings of Non-Studio live performances).

4) I could see many of the "Up and Coming" artists having "Non RIAA" Hi quality bootlegs produced offshore available for radio airplay. Many of these could be of songs availble in the US on RIAA labels.Are you seeing the RIAA firing a potentially killer act over radio airplay?

5) Record sales of RIAA artists would decrease SIGNIFICANTLY. I'm guessing the current "CD Sales down a few percent" will be a cakewalk compared to the effect on the recording industry. I would suspect the top 3-4 lables would all merge in an attempt to fend off the bloodletting. I'd guess 33% decrease minimum. ESPECIALLY if there is reasonable alternatives.

6) Smaller "Free Airplay" labels will explode with growth. Their compensation of artists will very soon equal or surpass the RIAA artists... In fact, they'll be SIGNING RIAA artists.

As I see it, thisis a very serious issue should it happen to radio. And it is almost assuredly the END of the recording industry players we know now.

But here 's a few constants that will continue.

Radio always seems to find a way to adapt. I would suspect they will again. Music entertainment is a commodity people want. It's been shown time and time again that people will pay for it. And the recording industry is something that has unlimited entry points. Many have entered and done VERY well. Ask Herb Alpert and Jerry Moss.

If I were the RIAA I'd be rethinking how my business needs to work. And like radio, it better include "Maybe I'm not always going to be as important to people as I once was."

Remember there was a day when the family gathered around the radio and listened to The Lone Ranger. We got TV and Cable and Dvds and whatever. And we still have radio.

Clouseau

 

[Mike Walker]

As for the longevity of CDs, the ones I purchased in 1982 still play just fine. How long will they last? I'd put their odds of having another 25 years left in 'em at least as high as my own (I'm 48!)

Tests that deliberately "age" cds to determine life expectancy put it at AT LEAST 100 years. Will that hold true? I'll never know. Sadly, neither will you

 

[dbdigital]

Radio SHOULD fight fees. WE SELL THEIR FREAKIN' RECORDS FOR US! Don't believe it? Why are they so willing to offer payola "off the record"?

93 percent of Americans listen to AM or FM radio EVERY WEEK. Virtually the same as a decade ago (though time spent listening IS down...with ALL media, because there's MORE MEDIA!)

Right. But terrestrial radio's exclusivity as an audio medium for promoting artist's records is over. And if satcasters and webcasters are forced to pay record label royalties then so should terrestrial broadcasters. Either they all pay or no one pays. There is no reason why terrestrial broadcasters should be given a pass on this, at least not anymore.

Personally, I like the idea of a charge back to record labels for promotional services rendered.

db

 

[radiopilot]

Radio SHOULD fight fees. WE SELL THEIR FREAKIN' RECORDS FOR US! Don't believe it? Why are they so willing to offer payola "off the record"?

93 percent of Americans listen to AM or FM radio EVERY WEEK. Virtually the same as a decade ago (though time spent listening IS down...with ALL media, because there's MORE MEDIA!)

Right. But terrestrial radio's exclusivity as an audio medium for promoting artist's records is over. And if satcasters and webcasters are forced to pay record label royalties then so should terrestrial broadcasters. Either they all pay or no one pays. There is no reason why terrestrial broadcasters should be given a pass on this, at least not anymore.

Personally, I like the idea of a charge back to record labels for promotional services rendered.

db

I agree with you on this, this 'grandfathering' of this country needs to change.. the fact that entities (radio & TV) were able to do and perform acts 30, 40, 60 years ago needs change with the times.

Either radio pays the royalties like everyone else (no grandfathering) or no one pays... can't have both! Actually I'd like to see radio stations PAY the fees, now the business model is in true light and then we'll see how profitable terrestrial radio then becomes.

Radiopilot