House Hearing on Radio Royalty & AI

[TheBigA]

Some analysis of the testimony on Wednesday:

Two Meetings, No Compromise. Why A Radio Royalty Deal Is Harder Than It Sounds.

The broadcast industry’s opposition to a performance royalty has been clear. The industry is against the idea — with a notable caveat. The door has remained cracked open to a

www.insideradio.com

I think this lays it out extremely well. They feel they need to get something in exchange for paying this new royalty. They won't be getting any additional services from labels or artists. So therefore they shouldn't have to pay full rate for playing the same songs twice (on air and in their streaming simulcast). They like the system they have with songwriters and publishers, and they want that kind of deal if they have to pay this new royalty.

 

[gr8oldies]

Throw out the payola rules and have the artists purchase airtime. If you can have brokered ethnic, brokered religion, and brokered finance formats, why not brokered music?😳😳😳🤣🤣🤣🤣🤣

Artists and labels can purchase airtime as long as the sponsorship is disclosed.

 

[boombox4]

The Artists that think they will get big money from this are mistaking. If they look back at their record company royalties from record, cassette, 8trak, CDs or down loads verses what the record company made most would agree they should have had a better lawyer. If this thing passes I seriously doubt they will see 5 cents on the dollar on their recordings' royalties from radio. The record company's didn't get big by not screwing their artists.

Any increase is an increase. That's what the musicians would tell you. Many of them are aware of how it was pre-streaming. That's part of the complaint. For many, it was better pre-streaming, because they actually made some money off of the royalties, because there were more revenues overall, from music consumption (especially when accounting for inflation), pre-streaming than there is today.

Even if the musician/artist was only getting 5 cents on the dollar, it was more profitable for them in the CD sales era, because overall revenues were generally greater. There were more dollars to get that 5 cents from.

With streaming, the business model changed, and all are making less because of it. One of the reasons the digital royalty issue is a big deal.

 

[davideduardo]

Throw out the payola rules and have the artists purchase airtime. If you can have brokered ethnic, brokered religion, and brokered finance formats, why not brokered music?😳😳😳🤣🤣🤣🤣🤣

You can already do that. There is no prohibition of a label buying spins or even a show about an artist or their new releases. As long as sponsor ID rules are met, that is doable.

 

[davideduardo]

Artists and labels can purchase airtime as long as the sponsorship is disclosed.

And some have been doing it for many years. Labels that release non-English language materials are known to buy time either for a single song to play or a block featuring an artist or the label's releases.

But many stations have a policy that limits ads in regular programming to a certain length, often as short as 60" to 90" at the most. And many don't want listeners to hear what may be a stiff as if it were part of their playlist.

 

[TheBigA]

With streaming, the business model changed, and all are making less because of it. One of the reasons the digital royalty issue is a big deal.

Not all are making less. Just the ones that aren't well known. For Taylor Swift, the streaming money is incidental.

The real problem is the music industry believes streaming and broadcasting are the same. They said so during the hearings. They're not. Broadcasting is one to many, while streaming is one to one. The NAB pointed out that a play on a local radio station is heard by thousands, while a stream is heard by one. These are different experiences, and are handled differently.

 

[TheBigA]

A new study says the term AI (artificial intelligence) is a turn off to consumers:

https://www.cnn.com/2024/08/10/business/brands-avoid-term-customers/index.html

A study published in the Journal of Hospitality Marketing & Management in June found that describing a product as using AI lowers a customer’s intention to buy it. Researchers sampled participants across various age groups and showed them the same products – the only difference between them: one was described as “high tech” and the other as using AI, or artificial intelligence.

 

[cc333]

A new study says the term AI (artificial intelligence) is a turn off to consumers:

https://www.cnn.com/2024/08/10/business/brands-avoid-term-customers/index.html

I saw that article. it makes sense to me.

AI, for all the hype, isn't actually all that intelligent, and for all intents and purposes isn't much unlike those Google Ad Sensing and Spotify playlist curating algorithms that we all know and hate.

There's this other thing called artificial general intelligence that would be really groundbreaking. So far, however, it's still mostly in the experimental/theoretical realm, so anything claiming to be "AI" or "artificially intelligent" technically isn't. The best of Chat GPT's capabilities don't even come close to true intelligence. Is it scarily good at mimicking human intelligence? Yes. Is it capable of creative, independent thought? Not quite yet, though it has gotten disturbingly good at faking it.

Given all the high profile problems that the so-called "AI engines" have faced over the past year or two since it has been made publicly available, it's not surprising that people don't trust it, especially when it gets crammed into absolutely everything, even when there's virtually no benefit in doing so.

c

 

[davideduardo]

Throw out the payola rules and have the artists purchase airtime.

They can right now. Payola prohibits employees who are not representing the owners of a station from taking payments for airplay or promotion.

A station can sell spins, as long as there is sponsor ID.

If you can have brokered ethnic, brokered religion, and brokered finance formats, why not brokered music?😳😳😳🤣🤣🤣🤣🤣

When I got to KTNQ in 1995, we had an hour of songs from a record label every night. I killed that almost instantly.

 

[davideduardo]

Around 15 years ago, the NAB was willing to agree to a royalty deal. I can't remember all of the details, but it seemed like it called for a cap on over-the-air royalty rates at roughly 1/2 what composers are paid with the option of fixed rates for lower revenue stations, established a consent decree for setting future rates for both over-the-air and streaming, rolled back streaming rates to what they had been roughly a year or two earlier, and phased the rates in over several years with a clause speeding up the phase-in depending on how many cell phones had radios.

To me, it seemed like a pretty good deal for the music industry, and the major broadcasters thought it was at least reasonable. The music industry, however, immediately said, "NO!", and, unless it wasn't reported by the trades, didn't make any sort of counter offer. It just went to Congress screaming for something better.

The record folks tried to buy off the small stations by offering a very low rate for those that billed under a certain amount... maybe $1 million a year (but I don't remember accurately). But the major market major stations would pay a revenue percentage that was superior to what they pay to the artist and composer associations.

In a declining business, this would be very detrimental to the industry

 

[TheBigA]

But the major market major stations would pay a revenue percentage that was superior to what they pay to the artist and composer associations.

That's what happened for the digital royalty. The labels got paid more than the composers. So the composers sued for an increase to match what the labels got. Radio has seen this movie before, because radio stations pay the digital royalty for their streaming stations. They know the royalty proposal is a bait & switch: They'll pay a low introductory royalty for the first three years, and then it will go to the Copyright Royalty Board, and the rates will get increased. That's why the NAB wants a negotiated royalty (like they have with the publishers) and no Copyright Royalty Board. This is a major sticking point.

 

[radiorobert]

As per usual this would just further the decline of an already declining industry by crushing the industry with more costs. To me, radio is free promotion for an artists music. There is no loss to the artist otherwise.

 

[TheBigA]

As per usual this would just further the decline of an already declining industry by crushing the industry with more costs. To me, radio is free promotion for an artists music. There is no loss to the artist otherwise.

Correct. But with the demise of the physical product business, record labels don't benefit as much. Which is why the labels are in fact charging artists for their radio promotion services. So this royalty is more for the record labels, and they're the ones financing the lobbying effort.

Record labels today are global businesses, and the labels are owned by foreign companies. They have this royalty in every other country, and they want to extend it here.

 

[radiorobert]

The digital nature of everything has certainly changed the environment from 25 years ago. Are these royalties charged to radio companies based on number of stations spinning the tracks or per individual track themselves?

 

[TheBigA]

The digital nature of everything has certainly changed the environment from 25 years ago. Are these royalties charged to radio companies based on number of stations spinning the tracks or per individual track themselves?

It's very complicated, based on audience and other factors. Every streaming station must submit a complete list of all songs played, with all the metadata to ensure every song played gets paid.

 

[boombox4]

As per usual this would just further the decline of an already declining industry by crushing the industry with more costs. To me, radio is free promotion for an artists music. There is no loss to the artist otherwise.

Yeah, but -- with some exceptions, country music being one of them, as BigA often points out -- the labels have already bypassed radio, in favor of streaming. Artists care less and less about radio than they do about Spotify, because Spotify, Pandora, et al are the platforms where they actually make money. And with the internet, the artists have other ways of promoting their music. One of them being artist websites, another being music-related podcasts, where artists are interviewed and they promote their music that way.

Agreed that a broadcast royalty will sock it to a lot of music stations, though. I'm sure the free promotion of the music aspect still matters to a lot of artists and labels, but it's declining. Online is the big kahuna.

 

[boombox4]

On a related note to my previous post, Edison Research says half of American music consumers use Spotify to discover new music. As it says in this article, "Spotify leads all other platforms as the one source used most often to learn about new music."

That statement seems to be centered on the 18-34 demographic. The article itself isn't written well, but it includes a PDF that goes into greater detail. In the PDF, it has a graph showing that AM/FM radio comes in third (dropping 10 percentage points in the 8 years since 2016) in methods to discover new music, following word of mouth and YouTube.

Edison Music Discovery Report Says AM/FM Third Most Important For Music Discovery

Edison Research has released the Music Discovery Report, detailing how important following music is to the U.S. population 12+ as

radioinsight.com

 

[TheBigA]

So while the politicians work on legislation having to do with AI, a group has come up with an idea for a new platform they call Humanable. This is from their press release:

(Nashville, Tennessee…) – September 16, 2024 – Humanable™ presents the solution to the Generative AI’s disruption of the music ecosystem, and the patent-pending, artist-first platform has launched as of Tuesday, September 17, 2024 during AMERICANAFEST. An overall sponsor for the week, Humanable is hosting its launch party at Nashville’s famed Santa’s Pub and introducing the service to AMERICANAFEST attendees and to the world. Santa's Ice Cold Pickers will be joined by an incredible lineup of Humanable artists from 7 p.m. to midnight. A Silver or Festival pass is required for entry.

“Songs created using generative artificial intelligence (AI) pose an existential challenge to the profession of songwriting. While the Nashville Songwriters Association International (NSAI) is working on legislative solutions and litigation to put guardrails around the technology, Humanable represents a marketplace approach where creators can attest that their songs and compositions come from 100% human effort. Humanable is an important tool as creators try to navigate ensured compensation in the era of generative AI technology,” said Bart Herbison, Executive Director of Nashville Songwriters Association International.

Humanable has built an industry-wide standard benefiting human creators, record companies, studios, publishers, musicians, and platforms by certifying human-created music, so fans can choose authentic music. The solution, which can be found at www.humanable.com, enables music creators to designate under oath that all elements of a song were created without using Generative AI (GenAI). Humanable will certify new and previously recorded music, preventing GenAI from further complicating licensing and royalties and reducing the risk of fraud for platforms.

Once a song is certified, and platforms adopt the HUMANABLE standard, fans will know it was created without GenAI thanks to the easily-recognizable HUMANABLE “H pick” icon, giving fans confidence they are enjoying authentically-human art.

“Humanable gives fans confidence that they are listening to real humans and the humans they love,” said London-educated playwright, Humanable Co-founder, and Chief Human, Lili McGrady. “GenAI is getting so good, some fans may not know the difference between human music and computer-generated files. We hope to drive confusion from the marketplace and preserve the heart in music and the integrity of the creative process, so consumers can be confident they’re listening to and following actual humans.”

The service will employ a $1.00 per-song charge to certify a song on the Humanable platform by an artist designating that all elements of the song were created without the use of GenAI. A $6.95 monthly membership will provide ongoing benefits such as the ability to use the Humanable family of marks on artists’ promotional materials and cover the costs to enhance the user trust through Humanable’s randomized and targeted auditing processes to confirm the lack of GenAI in the creation of the music.

 

[CTListener]

On a related note to my previous post, Edison Research says half of American music consumers use Spotify to discover new music. As it says in this article, "Spotify leads all other platforms as the one source used most often to learn about new music."

That statement seems to be centered on the 18-34 demographic. The article itself isn't written well, but it includes a PDF that goes into greater detail. In the PDF, it has a graph showing that AM/FM radio comes in third (dropping 10 percentage points in the 8 years since 2016) in methods to discover new music, following word of mouth and YouTube.

Edison Music Discovery Report Says AM/FM Third Most Important For Music Discovery

Edison Research has released the Music Discovery Report, detailing how important following music is to the U.S. population 12+ as

radioinsight.com

Spotify is my go-to for new country music and has been from the first week I signed up. The Friday morning New Music Friday playlist -- about 70 new songs, from artists well known or just starting out, mainstream or fringe -- is must-listen for me and has introduced me to far more interesting new talents than country radio has done for a long time.

 

[kevtronics]

So is Humanable going to ban all songs made using Auto-tune on the vocals and a computer-generated backing track? Because that's like 99.9% of what's coming out of Nashville these days.