Performance royalty for broadcast radio?

musicFIRSTA lot has been said recently about the increase in performance royalty rates for internet radio webcasters, and during the discussions it was mentioned that traditional broadcast radio is not currently subject to any sort of artist performance royalty. A new group called musicFIRST has coalesced with the stated goal of changing that.

musicFIRST is composed of artists and organizations (SoundExchange and the RIAA are both members) that stand to profit from such a royalty. The royalty in question would be similar to that paid by webcasters, which pays the owner of the sound recording (label) and the performers (artists, bands, and musicians). This would be in addition to the copyright royalty currently being paid to songwriters and publishers.

On this side of the argument, musicFIRST states that the radio industry makes millions of dollars annually from the sale of advertisements to listeners who are tuning in to hear the music, and the stations should not be allowed to build a business on someone else’s product without compensating them.

On the other side, the National Association of Broadcasters argues that radio serves an important role as a marketing avenue for music artists, and that the artists and labels have made millions because people heard them on the radio and decided to purchase a recording. They say the artists and labels should look at is as free promotion and advertising for their product.

I can see the point being made by both sides in this argument. History, however, would seem to be on the side of the broadcasters. In times past, labels and artists have even gone so far as to pay radio stations to play their music.

Regardless of which side you are on in this debate, I would suggest that the wording of the press releases being issued by musicFIRST would indeed get my ire up if I were a broadcaster. Recent press releases announcing the formation of musicFIRST have suggested that the goal of the organization was to

encourage Congress to right a decades-old wrong in copyright law and grant artists the same performance right in over-the-air radio that they receive from digital platforms.

As if the digital platforms have been there all along while terrestrial radio

refuses to pay performers royalties for their hard work.

Said royalty has never existed in the US. I don’t see how you can accuse someone of refusing to pay something that isn’t there. If the royalty law existed and they didn’t pay, then you could safely say they were refusing to, but this kind of language is intentionally misleading and vilifying.

musicFIRST does make a good point though when stating that a royalty of this sort does exist in almost, if not, all other free-market nations. Since broadcasters in the US are not required to pay this royalty, music by foreign artists is played in the US without the compensation of a royalty they are accustomed to at home. In retaliation, the broadcasters of these other nations do not pay royalties to American artists when playing their music. musicFIRST claims this to be a loss of $80 -100 million annually for American artists. One could point out however that you can’t lose something you never had to begin with.

Should AM and FM radio have to pay a royalty to the labels and artists for every song they play? Cable, satellite, and internet radio do. It does seem unbalanced, but in which direction?