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Royalty Fees Could Change Future of Radio


Royalty Fees Could Change Future of Radio

Royalty Fees Could Change Future of Radio

Congress is considering a new law that could change the shape of the American radio industry.

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The new law would require U.S. broadcasters to pay fees to performers for playing their music. Such fees are common practice in many countries.

The fees would provide additional revenue for artists, but also for the recording industry, which is feeling the effects of a slumping economy. It is also hurting because of changes in the way people access music, such as file sharing.

Committees in both houses of the U.S. Congress have approved royalty bills. But no vote has yet been scheduled on the measures in either house.

Radio Owners Claim Right To Free Speech

As things now stand, over-the-air radio broadcasters can play practically any song at all without paying the performers, although fees are paid to song writers and publishers. They claim the arrangement is a matter of "free speech."

This arrangement has been in place since the late 1930's following a court decision that copyright laws do not require radio stations to pay performers for playing their records on the air.

Some broadcasters worry that they will not be able to afford to pay the new royalties. Others suggest such fees would drive them away from music formats to talk programming.

The National Association of Broadcasters (N.A.B.) argues that the free use of music is mutually beneficial to both industries. Broadcasters say songs played on the radio basically amount to a free promotion for artists that helps them sell their music.

Artists And Record Companies Cite Fairness

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Martin Machowsky, a spokesman for MusicFirst coalition doesn't buy the promotion argument. His group, which includes record labels and recording artists, notes that all other platforms which help promote music also pay royalties.

The Recording Industry Association of America (R.I.A.A.) has long sought broadcast royalties for performers, similar to fees paid routinely by stations outside the United States. It expects the new payments will produce hundreds of millions of dollars in additional revenue each year.

A group of Senators and Congressmen from both parties are already gearing up to fight the proposed legislation with bills of their own. The outcome of the debate on Capitol Hill could have an impact on the what Americans hear on the radio.



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