Congressional Majority Against Radio Royalties; NAB Unveils New Ad
June 25, 2008 at 5:12 AM (PT)
The NATIONAL ASSOCIATION OF BROADCASTERS said TUESDAY that a majority of the House of Representatives now opposes legislation that would require radio stations to pay a performance royalty to all artists whose music it plays. With four new signatures yesterday, the resolution has 219 co-sponsors, a majority of the 435-member House.
The resolution before CONGRESS is called The Local Radio Freedom Act, and reads "CONGRESS should not impose any new performance fee, tax, royalty, or other charge relating to the public performance of sound recordings on a local radio station for broadcasting sound recordings over the air, or on any business for such public performance of sound recordings."
Today's announcement sends a powerful message to foreign-owned record labels that Congress is not falling for their bogus campaign to blame local radio stations for their financial woes.
The NAB says artists are compensated by the promotional value of radio airplay, which traditionally has driven most music sales. The NAB says a royalty system would cost the radio industry up to $7 billion a year, more than 40% of its current revenue.
"It would force many stations to stop playing music altogether," said NAB EVP/Press-Media Relations DENNIS WHARTON. "Music formats would be lost. TODAY's announcement sends a powerful message to foreign-owned record labels that CONGRESS is not falling for their bogus campaign to blame local radio stations for their financial woes. NAB thanks those members of Congress who appreciate the fact that free radio airplay of music generates untold millions into the wallets of performers and record labels. We will continue to educate policymakers on the devastating impact this RIAA tax would have on AMERICA's hometown radio stations."
The Local Radio Freedom Act is a non-binding resolution and not a law forbidding royalties. An identical resolution in the Senate, introduced just last month, now has the support of 13 Senators.
Recording industry groups, including the MUSICFIRST COALITION, note that most countries require radio to pay performance royalties. Satellite and Internet radio also pay royalties.
In response to THE NAB's announcement, the COALITION said, “When you look at H.R. 4789, the Performance Rights Act, and corporate radio’s non-binding resolution, there’s not too much we disagree on. We think corporate radio should pay the artists and musicians who bring music to life and listeners ears to the radio dial. They don’t. But on a broad range of issues we agree."
Pushing Their Point In Print
Using that support as momentum, the NAB put together a full-page print ad that will run in several CAPTOL HILL publications. The ad urges CONGRESS to reject performance tax legislation backed by the RIAA that would require AMERICA's hometown broadcasters to compensate foreign-owned record labels for radio airplay.
Under a picture of a duck holding a suitcase with major label logos on it, the ad's lead headline is: "First the record labels said it wasn't a tax ... Now they aren't telling you the money migrates overseas."
The body copy reads:
The recording industry is asking members of Congress to force local radio stations in their districts to subsidize the outdated business model of giant international conglomerates.
While three of the four major record labels are located outside the U.S., free, local radio stations are the lifeblood of towns and communities right here in our country -- delivering vital local news, weather and emergency information to your constituents.
Local radio stations have been the driving force behind music sales in this country for years. In fact, economists estimate radio provides anywhere from $1.5 to $2.4 billion dollars each year in free promotion for artists and their labels.
Don't let the recording industry hurt local radio stations just to put money in the hands of big international companies.
Say no to performance tax on local radio.