Today's question is this: Should AM and FM radio pay royalties to performers whose music they broadcast?
My immediate answer is of course not. Performers beg radio for airplay. In fact, performers and their record companies spend hundreds of millions of dollars each year trying to convince radio to play their songs. Airplay = additional sales of CDs (or digital downloads), concert tickets and merchandise. Asking for airplay, then charging for it, seems at least gauche and at most wrong. And asking radio for money now, at a time when all communications businesses are hurting, feels like piling on.
But after reading about the Performance Rights Act, which is now being debated in Congress, and talking to those with a vested interest, I'm rethinking my position.
The Performance Rights Act would amend federal copyright laws to grant performers compensation from terrestrial broadcasters who play their music. Details of the legislation are available at www.opencongress.org/bill/110-h4789/show.
One reason I'm coming around to the performers' point of view was something in an e-mail from Lisa Hanna, a representative of musicFIRST, a coalition of artists and music-business folks.
"Broadcasters do not play music for the purpose of benefiting an artist," she wrote me. "Broadcasters are in the business of selling advertising. By playing music that attracts large audiences, broadcasters are paid handsomely by advertisers. Actually, music promotes radio."
While that may be chicken-and-egg, her comment brought to mind a portion of a 1997 interview I did with Jeff Smulyan and Rick Cummings of Emmis Communications.
Q: Does radio owe anything to music? What I mean is, does radio have a responsibility to break, develop and continue bands' careers?
Cummings: Absolutely not.
Smulyan: That sounds like the record industry. The record industry says, "You've got an obligation." The only obligation that radio stations can ever have in this system is to its listeners. The only thing we can do is pay attention to our listeners and our advertisers.
Cummings: One of the things I used to say to a lot of the label heads who would call me at Power [KPWR-FM in Los Angeles] was, "When you guys become one of our top 20 advertisers - not any particular label, but the industry in general - I'll start to pay attention to what you're saying. But until then, I have one interest, and that's playing records I know my audience loves."
Smulyan: And even if they were our advertisers, it still doesn't mean you can play records that don't fit your audience. Because they won't advertise if you lose audience. You have to get your audience and you have to keep them happy.
Ouch. If that doesn't prove the performers' point - that radio is using their work solely as a means to sell advertising - nothing will.
My change of heart continued during a conversation last week with Bloomington-based folk singer Carrie Newcomer, who said this isn't just a fight between musicians and radio - it's a battle for music lovers as well.
"There's a disconnect in our culture, I think, between the artist and the art we love," she said. "We love music and art. We're moved by it and enriched by it. But often we don't associate the working musician and artist with the works that enrich our lives. Yes, the music business is a business with the word 'music' tacked to the front. But it's based on the hard work and passion of artists who want to continue making art ... If people appreciate art and love art and love music, I would hope they would have concern for the folks who make it and hope that they can continue making it."
Now, it's entirely possible that if radio is forced to pay royalties to performers, stations will retaliate by declining to interview musicians who want to promote their CDs and tours. Or they'll figure out a way to charge for that service.
Some stations might even switch to talk formats.
But that's down the road.
In the meantime, here's what else Newcomer had to say.
NUVO: My first thought was, this legislation is ridiculous because artists depend so much on radio airplay to sell their music.
Newcomer: Radio has always received free product from artists and record companies. It's a fluke in our law. The reason is because broadcasters had a very strong lobby when this law was created years and years ago. Artists do become more well-known through their airplay. That's true. But the way it works is that radio uses free product. It brings listeners to their station and they sell advertising. What artists and the music industry are trying to do with this legislation is create a more fair and equitable arrangement. The United States is the only industrialized country that does not have a fair and equitable system in place when it comes to radio.
That's how I see this idea. Aren't they giving artists free advertisement? No, they're using a free product. What's really putting a spotlight on this is with digital media. With digital media [such as satellite and the Internet], we've become more in line with the rest of the world. The laws there take into account the songwriter and also the artist and the owner of the recording. With digital media, when the royalties come in, they're divided like this: 50 percent to the record company, 45 percent to the featured performer and 5 percent to the music union. What's important about this is, it puts into law a standard that protects record companies and musicians - a standard I'd love to see applied to commercial radio, not just digital radio.
NUVO: You said the radio stations get free product. But you don't have to give it to them.
Newcomer: Well, we don't have to send it to them. But if they choose to play it, they don't have to pay us for it. The way the law works is, they can play an artist's work and they don't have to compensate the artist for it. Whether we send it or we don't send it doesn't really matter. They're not required to compensate us. That's the problem.
NUVO: Artists and record companies spend hundreds of millions of dollars to get airplay. Then you go to radio and say, "Now that you're playing our records, we want you to pay"?
Newcomer: Radio uses musical products to bring people to their station. They're not selling music. They're selling advertising.
A radio promoter is essentially selling their product over another product. It's really simple sales. For example, in television, a production company creates a TV program. A network pays for the rights to broadcast it. And the station sells advertising that'll be shown during the program.
It's essentially the same in music, except that because of a fluke in the law, they're playing one free product over another free product. What this legislation is about is trying to bring music in line with other artistic works. Why should radio be the one place where it's OK to not be fair and equitable?
NUVO: You get royalties as a songwriter every time your music is played on the radio, correct?
Newcomer: I do as a songwriter. Songwriters are covered by performance rights. Songwriters and their publishers are paid through performance-rights organizations like BMI, ASCAP, SESAC. They collect and distribute those funds. But that has nothing to do with the artist who is performing or the owner of the sound recording.
If you're a performing artist and you don't write, but your performances are still being played on the radio, you don't get compensated for that.
NUVO: Is this the right time to ask for money when the radio industry is in financial trouble?
Newcomer: I'm 100 percent for insuring that there's a fair balance between the artists and the radio stations. Especially the non-commercial radio stations and the small, mom-and-pop stations. There are provisions in this legislation that call for a cap on what you can charge a non-commercial station. Same thing with the small commercial stations. So those stations would never have an unfair burden placed upon them.
As an independent artist, I really understand that piece of the legislation and it's really important. As I understand it, of all the billions that are made on commercial radio every year, most of it goes to a very small percentage of big stations. It's really the huge companies we're talking about here.
Because of the digital media having fair laws put into place for them from the beginning, it has put the spotlight on an old law that has never been fair as it relates to radio.
As for why now, the landscape of the music industry is changing. As record sales go down, there's going to be a new landscape for how artists are able to continue to make music. My concern is that the artist doesn't get lost in the debate. It comes down to fairness and being equitable.
I understand what you're saying when you say the economy is tough right now. But it's really tough for everyone. It's tough for musicians as well. It's tough for the record companies. It's tough for the radio stations. We're all trying to create this new landscape and make sure that all of us are able to continue providing music and art out there and put it into the world.


Comments
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When did the law change?
Posted by AnonymousTue, 05/12/2009 - 1:39am
I worked for a radio station in the 90s and I remember seeing a check made out to BMI for over $40,000 for royalties. When did they stop paying them?
Performance Royalties
Posted by AnonymousTue, 05/12/2009 - 8:03am
I'm writing in response to the 5/12, 2:29 question posted by anonymous. You are correct about the BMI payments, but, as explained in the interview, the performance rights organizations, including BMI, ASCAP and SESAC, provide payments only to writers and publishers--not to performers. This legislation is simply about fair pay for fair play, and, if it is passed, the US will join the rest of the civilized world in providing payments to our deserving artists.
Open For Discussion
Posted by AnonymousFri, 05/08/2009 - 9:09am
I think the article opens up discussion on how to approach the situation. When it was stated that the radio companies are hurting financially I think that applies to everyone. Creating a fair and equitable solution for artist and radio is the the bigger picture. However, is it good to see so many artist supporting a change in the system and not just complaining. As an independent artist I need every dime I can get to help support and sustain my career. I hope this article even with its flaws can bring some needed attention to this situation.
That's a discussion. Not a fight.
Posted by AnonymousSat, 05/02/2009 - 12:18pm
Oops. Sorry, I recommended Lessig above already. Damn it. And why for heaven's sake is there no name for any comment?
Satellite and Internet Radio Pay Performance Royalties
Posted by AnonymousSat, 05/02/2009 - 7:23am
Satellite radio pays 7% of their gross revenue for performances and internet radio pays huge amounts some of which by today's law could amount to over 100% of their gross revenue!!! (Which is another issue altogether)
The National Association of Broadcasters sat on their hands when laws were passed for internet and satellite radio performance royalties hoping that the royalties would keep their competition at bay. Now the chickens have come home to roost.
It is time that terrestrial radio pay artists for their work. Bob Seger doesn't sell any more records because WFBQ plays his music every hour after hour. But WFBQ gains listeners because they play Seger and therefore can charge for their advertising.
Granted terrestrial radio pays songwriters through ASCAP, BMI, etc. - but the writers are paid through sampling so the actual artists may not get everything that they are due. It is time performing artists are paid and proper records are kept by terrestrial radio. The rules should be the same for all radio businesses.
Bop City - Classic Jazz Internet Radio
http://bopcity.blogspot.com
more to this
Posted by AnonymousWed, 04/29/2009 - 8:28pm
most of the bands i listen to rarely, if ever, get played commercial radio. i don't discover new music through commercial radio. i never have. sure i like plenty of big name bands that i hear on the radio (sometimes), but the radio (commercial radio) is not a terrific place to discover new music. listen to the radio if you like, but if thats your only source of new music you are missing out. check the internet, go to a show, buy something at random, see what kind of bands the bands you like are listening to or touring with. have a friend recommend something. if you search, you will find some really great bands that don't get a second of commercial airplay. how do they do it? tours! they perform shows and sell merchandise. they use the new fangled internet to reach new fans. commercial radio actually doesn't do that much for artists! if commercial radio didn't have catchy songs to play, there would be no reason for anyone to tune in and hear the stupid ads in between. if a musician helps a record company make money, they should get some money for providing that service. i'm a musician and i'm not begging commercial radio to play my music. we don't need that anymore. go newcomer.
Re think this stupid article
Posted by AnonymousWed, 04/29/2009 - 11:54am
I mean it sounds like this article is ran by the government .First they go up on Taxes ,and now they wanna keep us (composer) from making a good living ..I bet who ever wrote this article wrote it for their own benefit ..people These days are like crawfish .always yanking on the next person leg to get ahead ..If you agree to something as stupid as this article says'.You are just plain ignorant and will be hurting lots of Jobs and peoples lively hood ..This is how I get paid ,,why would you Cut our pay ,To make a multi billion dollar company more rich and say forget the talent that gives the radio work to stay alive ...What really needs to go down is: Radio station need to stop playing the same song 40 times a day and focus on getting Newer songs and Newer artist ..Pay us we deserve the little checks we get from Radio .we are the reason they still exist ....
Free doesn't mean "no revenue"
Posted by AnonymousWed, 04/29/2009 - 6:17am
Sorry, don't know why my name is not to be seen in the comment above - don't want to hide behind "Anonymous".
Cheers
Wolfgang Senges (http://contentsphere.de)
Free doesn't mean "no revenue"
Posted by AnonymousWed, 04/29/2009 - 6:14am
Free music means marketing, it means advertising your music. Get one radio DJ to play it only once to 10.000 people out there and you have 10.000 listeners. Maybe 1.000 of those people will like the song. and maybe 100 will buy it. Even if there are only 50 buyers, your revenue from one free broadcast is substantial.
Demanding more payment from broadcasters means: Less money for the programme they do. They'll play less artists. Even more than now, it will be only the most marketed and the most successful artists they are going to play.
So most probably, much an indie act will not be played at all. No royalties, no listeners, no people who get to like your music, no revenue.
Yes, that's black & white. Yes, that's an exaggerated point of view. Also, I'm aware of studio cost, instruments etc. For business models to finance your recording sessions and production cost see Patrick Wolf and Jill Sobule, amongst others.
Thing is, with radio (and I'm including internet radio too which has already to pay unfortunately) being urged to pay for serving as the best advertisement you could get for free, music & culture is going down. As well as your revenue does.
It is no fluke in the law. It is well thought out. (Have a read: Lawrence Lessig's "Free Culture". Available for free. Under Creative Commons license at http://free-culture.cc/ )
I'm not affiliated with L. Lessig.
Free my Nuts
Posted by AnonymousWed, 04/29/2009 - 12:16pm
Music cost too much to make to just give it to rich people ...Its Obvious you don't make music...Fact is we don't get a lot off of one radio spin.You have to be played all over the world to collect a fat check off of it ..What is aggrovating is certain artist like Kanye West who has the power to get their music played on the radio thru fund transactions, gets played 50 times a day on one station..Lots of people get tired of that same ole stuff.The media don't care because they are getting payed..Theres' alot of musician who deserves to get played other than kanye or Lady Gaga all day .The problem is not paying royalties,Its who you Paying them to.Of course I can open a radio station and play jay z , 50 ,and kanye west all day,but is it what the people really want or am I just looking out for myself as a radio company....This Talent is not cheap .I've spent over 25 grand on music equipment.Thats why I feel that taking my royalty check away is unfair .some of you live in a crab bucket,,wise up!How about we stop paying people who come up with dumb articles to kill the economy,like this one.
That's a discussion. Not a fight.
Posted by AnonymousSat, 05/02/2009 - 12:16pm
Yes, I'm no musician. Yet when I'm doing my job, the first steps always are for free. And yes, my equipment isn't as expensive as yours (though computer stuff etc isn't that cheap).
My advice take 30 min to watch Mike Masnick' keynote presentation at Leadership Music digital Summit here: http://www.techdirt.com/articles/20090422/0407024607.shtml
It's worth it, and he doesn't only focus on NIN. He explains business models from artists of very different success levels. Also, there are quite a lot more than what he mentions.
Second, try this link: http://free-culture.cc/
It's Lawrence Lessig's "Free Culture". You can download it for free. Don't be misled, it's *also* about free stuff, but more importantly it deals with the consequences of current copyright to our culture. So it doesn't mean "Don't Pay for Culture", it stands for "Free Culture from these Consequences".
Moreover, "nuts" is no argument.