musicFIRST: 'Deeply Troubled' By NAB Royalty Offer

The Argument Continues

The back and forth between The NAB and the musicFIRST COALITION over a performance fee for radio gets a comment from musicFIRST spokesperson TOM MATZZIE, in response to YESTERDAY's NAB "term sheet" offer (NET NEWS 10/26).

Wrote MATZZIE, "We are deeply troubled by the NAB’s rewrite of the hard-fought agreement musicFIRST struck with broadcaster negotiators this SUMMER. That agreement on fundamental economic terms was jointly communicated by the NAB and musicFIRST to Congress in late JULY.

The NAB’s term sheet gives the idea of a sweetheart deal a bad name. It might even be worse for the music community than the status quo.

The JULY agreement, forged together, was a very tough compromise that required substantial give on both sides. But it was fair and both radio and music perceived value. We were looking forward to a new chapter where both the music and radio communities could move into the future as partners.

"MusicFIRST has completed a preliminary analysis of the new term sheet. In it the radio broadcasters unilaterally cut their digital royalty rates and lowered their terrestrial royalty payment. Those changes by themselves undermine the fundamental economic equation that was core to the JULY agreement. The NAB’s term sheet gives the idea of a sweetheart deal a bad name. It might even be worse for the music community than the status quo.

"Fortunately, Congress writes the laws, not trade associations like the NAB. The musicFIRST COALITION will continue to press forward.

"The bottom line is that no recording artist should be forced to give up their work without consent or compensation, a fact now acknowledged by the NAB’s vote. The musicFIRST COALITION will continue and expand our campaign until this fundamental unfairness is corrected. Radio is the only platform in the U. S. that doesn’t pay performers. The music community will find it difficult, if not impossible, to support legislative efforts to expand the reach of terrestrial radio so long as this glaring unfairness continues."

CEA Pres./CEO Weighs In

CONSUMER ELECTRONICS ASSOCIATION Pres./CEO GARY SHAPIRO weighed in with a letter to NAB executives, in which he pushed for a "marketplace solution." SHAPIRO wrote that he was "disappointed" with the NAB's offer.

He also continued his attack on the NAB's support of adding FM chips in mobile devices, writing "We have yet to identify one member of Congress willing to support your attempt to impose old FM technology on new portable products," wrote SHAPIRO. The CEA vowed to continue to lobby against any mandate to put FM chips in mobile devices.

In AUGUST (NET NEWS 8/17), SHAPIRO went on record against adding radio in mobile devices, saying such a move is "not in our national interest." He continued, "Rather than adapt to the digital marketplace, NAB and RIAA act like buggy-whip industries that refuse to innovate and seek to impose penalties on those that do. The performance royalty legislation voted out of the Senate Judiciary Committee does not include this onerous and backward-looking radio requirement."

[What would you suggest for both sides to do to end this apparent stand-off?  Comment below, please!]

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