Congressional Panel Hears Testimony On Radio Performance Royalty Bill

Remote Hearing

WEDNESDAY's (2/2) HOUSE JUDICIARY COMMITTEE's hearing on the American Music Fairness Act, the bill that would impose a performance royalty on broadcasters, featured remote testimony from GLORIA ESTEFAN and NATIONAL ASSOCIATION OF BROADCASTERS (NAB) Pres./CEO CURTIS LEGEYT, but no radio industry representatives. The five witnesses at the hearing were given five minutes to make their cases, followed by questions from lawmakers.

ESTEFAN urged passage of the bill in her prepared remarks, asserting that "music has value" and noting that "life has become dire since the pandemic" for music creators forced to cut back on or eliminate live performances. Pointing out that the U.S. is the only industrialized country not to recognize a performance right, ESTEFAN said, "It simply doesn’t make sense that artists are not being paid when their music is played on one specific platform: AM/FM radio. Why hasn’t this been rectified sooner? Traditional AM/FM radio is the only platform that does not compensate performers for the sound recordings they use to fuel often billion-dollar businesses. This corporate radio loophole makes broadcast radio the only industry in AMERICA  that can use another’s intellectual property without permission or compensation."

"Life isn’t fair," ESTEFAN concluded. "We can’t change that, but the payment of music royalties should be. Because that is what respect is about."

LEGEYT took the industry's position against the bill in his remarks, pointing to the radio industry's emergency services and "unprecedented losses in advertising revenue" in the pandemic as reasons to oppose the bill, which he said "would harm the public good and fail artists." He cited "the countless artists whose careers were made when their first song played over our airwaves" and said that the "mutually beneficial relationship" between radio and artists -- "free airplay for free promotion" -- has served the public interest.

He complained that CONGRESS has until now focused on dealing with new and emerging technologies and not changing the law for "mediums that have existed for more than 100 years," and called a new royalty "simply economically untenable for local radio broadcasters," coming on top of the high webcasting rates set by the COPYRIGHT ROYALTY BOARD that he said make webcasting "cost prohibitive" and lead to broadcasters "currently choos(ing) either not to stream or to limit streaming."

Responding to Rep. STEVE CHABOT (R-OH)'s question about the impact of the legislation on small businesses, LEGEYT said that the arguments for the bill focus on the largest operators, but that "truly small" broadcasters would be harmed by having to pay the "significant fee" of $500 imposed by the bill. "This is real money," LEGEYT asserted, continuing that the royalty would "undermine" radio's emergency service efforts.

Accountant and SOUNDEXCHANGE and music publishing consultant BARRY MASSARSKY told the committee that radio's arguments against the royalty are based on a false premise, because stations make the lion's share of their revenues based on playing established hits and not by exposing listeners to new or unfamiliar music. 

GRAMMY-winning engineer/producer LAWRENCE "BOO" MITCHELL testified that although "Uptown Funk," the massive hit recorded by MARK RONSON and BRUNO MARS at MITCHELL's ROYAL STUDIOS in MEMPHIS, was one of the most played songs ever on Top 40 radio, "no one involved in the recording ... has ever been paid by the (U.S.) radio broadcasters who used and profited from their work." MITCHELL added that RONSON receives performance royalties from the rest of the world because he is a U.K. resident, but American artists are ineligible to collect those royalties because other countries will not pay them due to the lack of reciprocity with the U.S. And he noted that his father, MEMPHIS legend WILLIE MITCHELL, produced AL GREEN's album "LET'S STAY TOGETHER," celebrating its 50th anniversary this year, but "never received a penny from radio for his work."

Bassist and AMERICAN FEDERATION OF MUSICIANS NASHVILLE Local 257 head DAVE POMEROY echoed ESTEFAN and MITCHELL's arguments in favor of the royalty, adding that satellite and digital radio pay royalties and helped musicians in need during the pandemic through the union's AFM-SAG/AFTRA FUND. He pointed to the contradiction in the NAB's support for collecting for the content broadcasters create when used by social media platforms but opposition for royalties for content musicians create, and explained how the NAB's argument that radio pays royalties to songwriters and shouldn't have to "pay twice" is misleading, using the classic song "Jolene" as an example.

"When a radio station plays a recording of the WHITE STRIPES performing the song 'Jolene,' written by DOLLY PARTON, both the WHITE STRIPES and DOLLY PARTON should be compensated," he said. "We don’t say that a radio station should pay its news writers but not its newscasters. It’s no different here." Later, under questioning by Rep. ZOE LOFGREN (D-CA), POMEROY noted that paying artists would also "open a floodgate" of tax revenue from the income generated for the artists.

A statement after the hearing from musicFIRST Chairman JOE CROWLEY said, “Today’s hearing on the American Music Fairness Act is a massive step toward true music fairness and securing fair pay for the working musicians across the country who help make the soundtracks to our lives. On behalf of the musicFIRST coalition, I’d like to offer my sincere thanks to Chairman NADLER for taking up this issue; to Reps. (DARRELL) ISSA (R-CA) and (TED) DEUTCH (D-FL) for continuously championing the rights of American music creators; and to all of the music creators who testified today for bravely sharing their experiences and putting a human face on this pressing problem.

“We were disappointed that not a single broadcasting company chose to appear for today’s critical conversation before CONGRESS," CROWLEY's statement comtinued. "But they will eventually have to realize that it is time for billion-dollar corporate broadcasters to finally pay musicians for their hard work and stop exploiting their music for profit. We’re grateful to the members of CONGRESS who are already standing up for working-class musicians, and we look forward to welcoming more lawmakers to our cause -- including our friends in the SENATE -- in the weeks ahead.”

SOUNDEXCHANGE CEO MICHAEL HUPPE offered a statement saying, “This hearing was long overdue. Since the last hearing on music fairness in 2014, radio broadcasters have generated $140 billion in revenues -- and not paid a dime to the performers or labels who supplied the music that is played on AM/FM radio. This injustice cannot continue. CONGRESS has the power to make it right. I implore them to do so.”

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