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Performance Royalty Tax: Good, or Bad..?

B

ButtnPushr

Guest
I keep hearing about this royalty tax & I guess I don't know which side to take. Radio stations say if they have to pay it, they can't afford it, it's game over. Artists say they're using their music for free & they should have to pay for it since the music industry isn't what it used to be. As radio guys, who are we rooting for? I think if the artists win this, it'll force radio stations to PAY for content. Wouldn't that mean actually HIRING people then? Again, I'm not sure. Feel free to enlighten me..
 
Frankly I think it's lose-lose. Stations already pay copyright royalty fees. The artists should be enjoying the fact they are getting airplay for free. They should be generating revenue from their live performances. Radio airplay of a 3 minute song doesn't equal a live performance.

But I do agree that both industries are a mess. Labels don't allow artists to nurture and grow, like they used to. The artists realize it's either boom or bust with their first album.
 
Don't BMI/ASCAP license fees go to pay artists' royalties? Don't stations have to pay a premium for their libraries? Sounds to me like artists (or more accurately, their record labels and music publishers) don't think they're making enough money, so they want to bleed stations for more. This will really hurt the small market stations whose budgets are stretched thin enough as it is (and I used to work for one, so I have painful knowledge of that fact).

The fact of the matter is, artists are getting a lot of money from things like store sales, iTunes, Amazon, and airplay. This "performance royalty tax" (which is not really a "tax" but more an increase in royalty payments) would hit every venue that uses recorded music, not just local radio. Party DJs, especially, would probably either go out of business or operate illegally (although I'd think that, just by buying a CD and performing it in a venue that does not charge admission, that would be enough for the artists).

The NAB is on record as being in opposition to the performance royalty bill, but apparently it's still in committee on Capital Hill. This blog has a good take on the bill and the shenanigans to try and get it passed - http://www.broadcastlawblog.com/tags/performance-tax/.
 
Greed has reached critical mass on both sides. It's just a matter of who will grease DC the most, the record industry or radio. Stay tuned.
 
Broadcast performance seems to have lost some of it's percieved value. Sales of recordings keep sliding. More & more performers write and produce their own material. The music business continues to search for a revenue stream. Simple survival of the fittest.
 
Dan Dennis said:
Don't BMI/ASCAP license fees go to pay artists' royalties? Don't stations have to pay a premium for their libraries? Sounds to me like artists (or more accurately, their record labels and music publishers) don't think they're making enough money, so they want to bleed stations for more. This will really hurt the small market stations whose budgets are stretched thin enough as it is (and I used to work for one, so I have painful knowledge of that fact).

The fact of the matter is, artists are getting a lot of money from things like store sales, iTunes, Amazon, and airplay. This "performance royalty tax" (which is not really a "tax" but more an increase in royalty payments) would hit every venue that uses recorded music, not just local radio. Party DJs, especially, would probably either go out of business or operate illegally (although I'd think that, just by buying a CD and performing it in a venue that does not charge admission, that would be enough for the artists).

The NAB is on record as being in opposition to the performance royalty bill, but apparently it's still in committee on Capital Hill. This blog has a good take on the bill and the shenanigans to try and get it passed - http://www.broadcastlawblog.com/tags/performance-tax/.
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The BMI/ASCAP/SESAC fees go towards the publisher and copyright owner of the song. If the performing artist is not the publisher / copyright owner, then he/she doesn't receive anything from those three operations.
 
As mentioned earlier, this is a lose/lose. This is the same battle internet radio has been fighting.

If radio has to pay for content, they will not be hiring. You will find stations doing more layoffs if this becomes another invoice that must be paid. Raising overhead amidst declining ad revenues is not the path to success.

Both the radio and record industries are trying to make something meaningful out of business models that do not, and have not, worked for years now.

Also keep in mind, the artists would not receive the bulk of this money. The foreign-owned record labels will get it
at the expense of the artists. I've purposely played lesser-known artists over the past year only to have them tell me they received..nothing. And I paid royalties on their material.

Think of it as "reverse payola." A spade is a spade no matter what else you call it!
 
If the Performance Royalty should happen to pass, and I don't think it will any time soon, music radio, as we know it, will cease to exist.Simply put, it will cost multiple MILLIONS more per year and there's no way that the major players in this business will pay that extra money and keep the status quo. Also, I, and other DJ types like me, will be forced to work at Starbucks.
 
johnsummers said:
If the Performance Royalty should happen to pass, and I don't think it will any time soon, music radio, as we know it, will cease to exist.Simply put, it will cost multiple MILLIONS more per year and there's no way that the major players in this business will pay that extra money and keep the status quo. Also, I, and other DJ types like me, will be forced to work at Starbucks.
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Starbucks is out of business. :(

I think both radio and the music industry need to stop pointing fingers at each other, and point to themselves instead.
 
There won't be a royalty fee to radio stations. It's a dead issue. To much support behind a "not tax" and, particularly, by minority broadcasters.

So, Dionne Warwick and Sam Moore scream and holler ... they haven't had hits (or recordings) in years. They have "lost their voice" to those who care what they think today, in this day and age.

They've long outlived the contracts they willingly signed with their labels and must recognize that they got screwed by their labels, publishers and copyright holders (ASCAP/ BMI & SESAC) not radio ... which has never paid a dime (as an exemption many many decades ago) to artists.

Never have. Never will.

The problem here, however, is how the same "treatment" isn't true of Internet Radio. At least, legitimate "Internet Radio" ... where people actually DO pay licensing fees for both royalties (RIAA / Sound Exchange) AND to copyright holders (ASCAP, BMI & SESAC.)

I pay the fees, so should others. But to be doing it at the expense of "free radio" ... when we have to pay for each "connection" is unfair and certainly not on parity with terrestrial radio or satellite.

It's a money grab.

The answer is ... no, radio shouldn't pay to promote an "artists" talent. To pay copyright fees is one thing. But to pay artists ... is their choice between them and the record label.

And parity is needed ... because if "radio" is allowed to promote via a web stream, legitimate Internet broadcasters / webcasters, should too ... as long as they follow the same rules of "radio."
 
I read on RI news that the Congressional Budget Office came down on the side of radio - in short they don't think it's such a swell idea.
 
It sounds more like Pay to Play. I agree that there was a time when most these musicians would be excited by the fact that their song was being played on the radio. What ever happened to that?

What will be next? It will cost you to have our artists in your studio to promote their tour/cd?
 
While I don't agree with it, I have no intentions of opposing it, either. Why? I keep hearing ads (on Clear Channel stations, no less) stating something to the effect of "local radio will cease to exist." True local radio ceased to exist about a decade ago, and with all the voice-tracking and syndicated crap it's getting less and less local all the damn time. Bring back local radio and I'll oppose it. Otherwise, "local" radio can take a long walk off a short pier.
 
Recording artists are signed to contracts and get paid. If this bill passes it goes to the recording companies not the artists.Artists for it are under the influence of their respective companies to voice for it. ASCAP/BMI takes care of the writng and performance royalties,and the broadcast media has been subscribing to both since they fiurst fired up a transmitter practically. Record labels have never modified their marketing to fit todays buying public or the means to obtain product. In the next decade musicstores or chains will be hard pressed to have a physical outlet that will sell music. Radio stations provide essentially a free commercial/promo for every song its spins. To get on the air, the label must market themselves better, the artist must come up with a creative and compelling song that one would want to buy. Todays Auto tone stuff is pure crap,and the talent level is not talent just marketing. passing the bill won't solve the drop in sales. Its whats in the studios that will, and its called quality talent, true talent without dressing it up with Auto tone. Its been in a drought for a very long time.
 
NealH said:
While I don't agree with it, I have no intentions of opposing it, either. Why? I keep hearing ads (on Clear Channel stations, no less) stating something to the effect of "local radio will cease to exist." True local radio ceased to exist about a decade ago, and with all the voice-tracking and syndicated crap it's getting less and less local all the damn time. Bring back local radio and I'll oppose it. Otherwise, "local" radio can take a long walk off a short pier.
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Great post, Neal.!! I agree! Hopefully, this "tax" will pass and force these monopoly companies (Clear Channel, CBS, Cumulus, etc.) to have a fire sale and rid themselves of these money pit stations, selling for pennies on the dollar. Then smaller ownership companies can buy them up and make them LOCAL again. Local sales, local talent, etc. Sounds like a WIN for the industry!! And hopefully, a LOSS for the big companies who stole the LOCAL stations away from us in the first place!
 
I'm just having a real, real, hard time with CC's ads which are asking me to "Save Local Radio" when the next thing I hear is voice track.
 
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