Performance Fee: Point, Counter-Point
April 26, 2010 at 4:22 AM (PT)
The ongoing battle over the proposed Performance rights fee -- often referred to a "tax" by it's opponents, spilled into the mainstream media this morning in THE WASHINGTON POST. In it's commentary section, musicFIRST Executive Dir. JENNIFER BENDALL squared off against NAB Pres./CEO GORDON SMITH, with both explaining their positions on the legislation.
Wrote SMITH, "It's the WASHINGTON way: Get legislation introduced that benefits a special interest, identify a 'face' for your industry, mount a pricey lobbying campaign, and hope the bill passes before the American people notice. The Performance Rights Act, aggressively supported by the RECORDING INDUSTRY ASSOCIATION OF AMERICA (RIAA), is one example."
Local radio stations -- the musicians' greatest and longest-serving promotional partner -- would be responsible for signing checks worth hundreds of millions of dollars, instead of the record label executives who have systematically abused artists ..
Counters BENDALL, "Congress is poised to close a loophole in copyright law that allows AM and FM music radio stations to earn billions in ad revenue every year without compensating the artists and musicians who created the songs listeners tune in to hear. The Performance Rights Act has been approved by the Senate and House judiciary committees."
"Supporters tell a woeful tale of a once-famed musician struggling to make ends meet, clinging to the hope of legislation that would reverse decades of injustice and secure a financially sound future for recording artists across AMERICA," continued SMITH. "But in this case, local radio stations -- the musicians' greatest and longest-serving promotional partner -- would be responsible for signing checks worth hundreds of millions of dollars, instead of the record label executives who have systematically abused artists for decades. In fact, 50% of the proceeds from this new fee on radio stations would be funneled directly into the coffers of the record labels."
"The music community has been fighting since the early days of radio to close the copyright loophole," wrote BENDALL. "Other radio platforms -- satellite radio, Internet radio and cable TV music channels -- pay performance royalties. Even AM and FM music radio stations that stream their signal online -- same music, same DJs, same ads -- pay performance royalties. They do not pay for over-the-air broadcasts."
"The record label claim that this legislation is about 'fairness to artists' is dubious. D.C. native HERB FEEMSTER of PEACHES & HERB fame -- as well as artists ranging from BENNY GOODMAN to PINK FLOYD to CHER -- had to file lawsuits against their record labels to recoup unpaid royalties," noted SMITH. "Contrast the record label exploitation of artists with that of radio stations that advance the careers of musicians with free airplay and concert promotions. With a growing audience of 239 million weekly listeners, free and local radio remains an unparalleled promotional platform for music, generating untold billions in album and concert sales and merchandising opportunities."
"Broadcasters themselves cannot honestly oppose paying for the music they play at the same time they are asking cable systems to pay them for use of their TV programs through retransmission consent agreements," BENDALL pointed out. "Big corporate radio groups do not like the Performance Rights Act, but we want to make sure that small and minority-owned radio stations are not hurt by this new payment. So about 75% of all music radio stations will pay $5,000 a year or less to clear the rights for all the music they use. Some could pay as little as $100 a year."
Summing up, SMITH wrote, "No one disputes the need for artists to be paid for their work. But like every other business in AMERICA, those payments should come from their employer, the record label, not from the local radio stations that have propelled their careers to stardom."
BENDALL wrapped up, writing, "Opponents call it a performance tax. A copyright royalty payment is not a tax, never was, never will be. They claim most of the money goes to big foreign-owned record labels. It doesn't. Most of it will go directly to artists and musicians. And those record companies are right here in the U.S. where they pay employees and taxes. They contend it would just benefit big-name artists. Not true. It benefits all artists and musicians."
[The battle rolls on for the Performance Fee (Tax). Have any of today's viewpoints changed your mind on this hot-button topic? Share your comments, below.]