Brindle Media

Posts Tagged ‘Performance Rights Act’

In his blog today, Jerry Del Colliano offers his solution to the radio/RIAA Performance Rights Act standoff:

“1.Agree upon a very, very small fee for radio stations and guarantee the rate for the next seven years. Of course, you’ll never get the seven years but start low and give an increase — a small one — at one or two points along the way.

2. Local, independent operators (mom and pops), the real heart of local radio, should be totally exempt from any fees. I believe this can be negotiated in. Local operators are helping their communities and local and regional economies, they deserve a break. This is the strongest argument for local radio — where local radio actually exists — and this is the workaround.

3. Radio groups operating under 30 total stations should get an additional break no matter what market they are in because 30 stations constitutes a small group by today’s consolidated radio numbers. The number 30 can be 40, or 50 — it’s negotiable.

4. Large consolidators like Clear Channel, Citadel, Cumulus and others should pay the highest fee — but even that should be comparably low. Remember, the music industry just wants to get rid of the performance exemption so it can raise these percentages as soon as possible. Their compromise might have to be accepting pennies on the dollar for the first seven years.

5. This is a must and only a fool would knowingly agree to pay additional music royalty taxes for terrestrial radio without it. Radio stations would be exempt from paying these charges for their podcasting or online streaming of programming that is separate and apart from their terrestrial radio signal. The future is mobile Internet and as a result, this is the concession that radio operators need to get a leg up on the new frontier. The radio industry can argue, okay — you get some music royalties for terrestrial radio under certain circumstances but you give us music in this new space for free while we take the next seven years to build the podcasting and mobile and streaming businesses. It will be worth even more to you when we use our know-how to build these platforms and you can get a royalty on them as well later.”

You can read Jerry’s full blog at http://insidemusicmedia.blogspot.com/2010/04/radio-royalty-solution.html

musicFIRST is at it again.

Yesterday, Dionne Warwick was in Washington trying to persuade Congress to pass the Performance Rights Act. According to Dionne, “This is a critical issue for not only those of us who have made music our careers, but for those who are trying to make a name for themselves in the business. Performers from every genre of music should be fairly compensated for their art. Thus far, radio is the only medium that fails to provide artists with fair compensation for the use of their music and we feel it is time for radio companies to join Satellite, Internet, and Cable music distributors in giving musical artists what they have worked so hard to earn.”

I’m sorry, Dionne but could we review your tax records for the past 45 years? I would suspect that a lot of money has flowed into your personal account primarily because of the FREE exposure and promotion you received from radio stations playing your songs in high rotations and on-air personalities reinforcing your brand by praising your talent. I’m sure that your contract with your record labels was designed more in their best interest than yours but that’s not radio’s fault. What all that FREE exposure on radio did for you, however, was increase audience awareness of your talent, increase your TV exposure, increase demand for your live performances and increase the fees you could demand for those performances. Seems to me that you profited nicely from all that FREE exposure.

And before someone posts the same lame comment about radio gets free use of our airwaves and we the people own the airwaves, it would be useful to remember that radio stations are granted short-term licenses to access those airwaves with the promise to operate in the public “interest, convenience and necessity”. Then, companies must invest millions of dollars in order to build their facilities, purchase the equipment, pay the electric bills (which can run into the hundreds of thousands of dollars a year), pay the personnel (on-air staff, engineers, support staff, sales people, management), pay a large
percentage of gross advertising revenues to music rights companies (BMI, ASCAP, SESAC) and pay local, state and federal taxes. If times are good and the station does a good job of serving its listeners, it can earn a nice profit. If times are tight, it can lose money even if it’s doing a good job of serving its audience. So, saying that radio gets “free” use of our airwaves is a bit misleading.

It amazes me that the artists who support musicFIRST’s efforts don’t understand that if the RIAA gets its way and forces radio to start paying for the right to play songs then fewer stations will choose to continue playing music and those stations that do continue to play music will become more selective about what they play. If a station is paying for songs, its budget will dictate that it choose the most cost-effective tunes which will be obvious hits by artists with established track records. Consequently, playlists will become even tighter. I’m not sure that’s the goal that the musicians supporting musicFIRST are trying to accomplish.

Many artists at this year’s Grammy Awards signed a letter which the Recording Academy intends to send to Congress regarding the controversial Performance Rights Act. Daryl Friedman, a VP for the Recording Academy says: “In speaking to these talented artists, I heard three constant refrains. First, their concerns for background singers and musicians and older legacy artists who need to be fairly compensated; second, their willingness to sit down with radio to work out a solution; and third, if radio still refuses to talk, their commitment to take the fight to Washington.”

The Grammy Week January 2010 statement reads as follows:
“We, the undersigned artists, believe in the partnership between music and radio. We believe that artists (including the background singers and musicians and the great legacy artists of the past decades) deserve to be compensated when their music is used by radio. We support the Performance Rights Act because it is fair to radio and fair to artists. We encourage the radio industry to work with the music community and Congress to pass The Performance Rights Act. Together, we can create a true partnership that benefits radio, artists and musicians, and fans.”

Artists who signed the statement include Nitty Gritty Dirt Band, Tre Cool, Mike Dirnt and Billie Joe Armstrong of Green Day, Stephen Stills, Kenny Aronoff, Sheryl Crow, Anthony Kiedis, Chad Smith and Flea of Red Hot Chili Peppers, Phil Soussan, Jackson Browne, Don Was, Dave Matthews, Josh Groban, Travis Barker, Andrea Bocelli, Apl.de.ap, Taboo, Will.i.am and Fergie of Black Eyed Peas, Drake, Mary J Blige, Mick Fleetwood, Stevie Nicks and David Foster. Recording Academy President and CEO Neil Portnow says, “Standing right behind them are thousands of unknown and up-and-coming music makers who face the question of survival every day. In the coming decade, unless they can make a living at their craft, the quality and creativity of the music will be at risk.”

These artists have, of course, been brainwashed by the record industry spin machine. They don’t seem to understand that passage of the Performing Rights Act will result in fewer music-focused radio stations. Their assumption is that, since music-intensive radio has provided free commercials for their recorded music for the past 5 decades, stations will continue to do so. Perhaps they don’t realize that the reason radio stations became music-intensive was because music provided a mutually-beneficial symbiotic relationship for the radio and music industries: cost-effective programming for the stations and free promotion for the record labels. If the Performance Rights Act is passed, station management will decide that it’s more cost-effective to air talk programming, artists will receive less exposure and the record labels will continue to lose money.

Update: With Congress back in session, both the the National Association of Broadcasters and MusicFIRST have amped up their lobbying efforts. The NAB’s campaign is pretty innocuous, Stop The Performance Tax. MusicFIRST, however, has decided to play nasty. Here’s the logo for their site, PiggyRadio.com