House Subcommittee Passes Royalty Bill, NAB Girds For War On House Floor

House Voted Today

The House Judiciary Subcommittee on Courts, the Internet and Intellectual Property met TODAY and approved a bill requiring radio stations to pay royalties to performers and record labels. The vote came while Representatives, often of the same party, were sending letters to their colleagues , advocating one side of this issue or the other.

Meanwhile, the NAB put the best spin on the situation, by signifying its intention to wage all-out war once the vote come to the full House floor. EVP DENNIS WHARTON released the following statement:

Today's vote comes as a complete non-surprise, given the House IP Subcommittee's history of support for the RIAA-backed tax on local radio stations.

"Today's vote comes as a complete non-surprise, given the House IP Subcommittee's history of support for the RIAA-backed tax on local radio stations. Despite TODAY's action, there remains broad bipartisan resistance to the RIAA tax from members of Congress who question whether a punitive fee on America's hometown radio stations should be used to bail out the failing business model of foreign-owned record labels." 

Cue The Happy People

The MUSICFIRST COALITION's Exec. Dir. DOYLE BARTLETT was pleased with the House vote.  “Subcommittee passage of H.R. 4789 is a major victory for America’s artists and musicians and a major triumph for fundamental fairness. We applaud Representatives BERMAN and ISSA and the members of the subcommittee for their hard work on this bill. With their leadership and support we have made significant progress toward creating a fair performance right on radio. But we still have a long way to go."

“A loophole in the law lets AM and FM music radio stations earn $16 billion a year is advertising revenue without compensating the artists and musicians who bring music to life and listeners’ ears to the radio dial, he continued. "It’s not right, it’s not fair and we are going to make sure it is changed. All other music platforms – satellite radio, Internet webcasts, and cable television music stations – pay artists and musicians to use their music. It’s only fair that terrestrial radio be held to the same standards." 

Sen. PATRICK lEAHY (D-VT), Chairman of the Senate Judiciary Committee, which will take up the bill next, gave it his full endorsement: "Members of the House Judiciary Committee today took the first steps in moving forward legislation to provide fair performance rights to artists. Since I joined with Sen. HATCH and our friends in the House last year to introduce performance rights legislation, I have heard from both performers and local radio stations about this legislation. The House Subcommittee’s mark today has continued the debate on how best to protect the rights of performers and songwriters, and the needs of noncommercial and small commercial radio stations, like many stations in VERMONT. I hope the Judiciary Committee might be able to turn its attention to this issue before the end of the year."

Dueling Letters

Yesterday, Reps. GENE GREEN (D-TX) and MIKE CONAWAY (R-TX) circulated a letter to colleagues noting the momentum for the Local Radio Freedom Act, which staunchly opposes a performance tax. The letter, which urges additional support for the resolution, cites the official co-sponsor count according to the Library of Congress, 221, a figure that includes 219 active members of House of Representatives.

A companion resolution, S. Con. Res. 82, has been introduced in the Senate and is supported by 13 senators. Called The Local Radio Freedom Act, it 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."

At the same time, Reps. MARSHA BLACKBURN (R-TN), DARRELL ISSA (R-CA) and JOHN SHADEGG (R-AZ) sent their own letter to fellow Republicans, urging support of the royalty bill, which is sponsored by a Democrat, Judiciary Subcommittee on Courts, the Internet and Intellectual Property Chairman HOWARD BERMAN.

The NAB, which is fighting the measure, said YESTERDAY (NET NEWS 6/25), that it had secured support from a majority of House members on a resolution opposing the bill. But CNN reports the recording industry, which stands to gain millions from the bill, isn't giving up.

"The resolution was introduced before the bill" was drafted, said NATIONAL ACADEMY OF RECORDING ARTS & SCIENCES VP DARYL FRIEDMAN. "All of those things ended up being accommodated in the bill," he said, arguing that those changes could give some members leeway to vote for both proposals.

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