Neil Portnow

The 52nd annual Grammy Awards, to be held and broadcast live from Los Angeles on Sunday, January 31st, will certainly be the highest profile event of the year for the Recording Academy. After all, on top of a bevy of awards being given out, the presentation will also feature performances by nominees Beyoncé, the Black Eyed Peas, Bon Jovi, the Dave Matthews Band, Green Day, Lady Antebellum, Lady Gaga, Maxwell, P!nk, Taylor Swift, and the Zac Brown Band. To top it all off, there will be a tribute to Michael Jackson, featuring world premiere of a 3-D mini-movie for Jackson's "Earth Song," which would've been shown during his "This Is It" tour.

Yet the Grammys are just a small part of the Recording Academy's mission. It has taken an aggressive role in standing up for the creative community's right when it comes to the performance rights royalty and illegal downloading. President/CEO Neil Portnow outlines the Academy's perspective on those issues and what he hopes to accomplish.

Describe the state of the music business, from the Recording Academy perspective.

Obviously, the business side of the industry continues to go through dramatic changes in terms of the way music is distributed and consumed. That shouldn't be a surprise to anybody, given that we had a business model that hadn't changed since the inception of the recorded music business. It's a time for a change, which came at a lightning pace, so the industry is doing some catch-up to address those changes.

What are the most pressing issues facing the Recording Academy and its membership?

We represent the creative community; so the core issues are those things that concern our membership. Certainly the Academy has taken a leadership position within the industry on intellectual property and copyright, which is one way to protect our constituency. Along those lines, the Academy is also largely responsible for a creation of an industry coalition -- a CEO Summit - where the leaders of 25 music industry groups meet no less than twice a year to work on issues that impact us all. We've made some of the progress seen on the major issues that confront our industry; even those who have internal industry conflicts within them have been resolved largely as result of deepening relationships and regular dialog created by this CEO group.

What specific examples of progress can you cite?

The largest one, front and center, is the Performance Rights Bill in Congress. There initially was a division within our own industry on how to approach this because of the different competing interests that were at stake here. It's a good example of the creative community coming together, finding some common ground, taking that unity to the Congressional level and moving it forward to a place beyond where it had been in the past few years.

In years past, you, as well as your predecessor, spoke out during the Grammy telecast against illegal file-sharing and the damage it has done to the music community. Is that still a major concern?

I believe it is. It's a matter of how one approach the issue and how one thinks there's likely be the most significant influence and result. From my own point of view, it's really less about pointing fingers and threatening people than about educating and reminding them of the unbelievably important contribution music makes to society -- and the fact that music still has tremendous value

What can you do to stem the tide of illegal file-sharing? Have you changed your tactics in dealing with it?

We've always taken the position that it's about education. Years ago, we initiated a full-blown campaign called "What's The Download," after engaging with Edelman, one of leading advertising and PR firms. The campaign was based on a lot of research we did with consumers and young people. We believe then, as we do now, that when people understand a) the value of music; b) the harm that comes from illegal downloading and not paying the creators ... when they have a true understanding of who gets hurt; it's not just about superstars who are well off, but the next generation of up-and-comers and behind the scenes people combined with from a business perspective ... and that we're offering the consumer and music fan an efficient, effective and user-friendly alternative ... we believe all of those can have a positive impact on our industry.

Is that enough to change a generation's perspective into feeling that music is worth paying for -- and away from the mentality that duplicating for free is okay because it's highly unlikely that they'll get caught doing it?

We've already seen signs that a combination of convenient technology along with "wanting to do the right thing" can improve the situation. As with any educational program, it has to be massive when you're trying to change a certain generational or cultural perception - it'll take time.

Radio has long been the most effective and biggest promotional vehicle for music in America. Are you worried that such a bill would do more harm than good by driving radio stations out of music formats?

I don't believe that radio would abandon music formats because music is their bread and butter. If you remove music programming from radio, the industry as a whole would undeniably be dramatically negatively impacted. People don't tune into radio to listen to commercials; we know a majority of radio listeners are there for the music, which is precisely our point -- which radio is a multi-billion industry built on the back of the creative community. It's common sense to believe that an industry built on another industry's talent and contributions ought to be paying for that -- and as they appropriately do for songwriters.

How do you deal with the perceptual problems of asking radio for a royalty when award-winning artists take the stage at the Grammys and other award shows and thank radio for their success?

The Academy and certainly the creative community are huge fans of radio; they appreciate the relationship over the years, so no one is saying we don't appreciate or thank radio for their participation in the process. With that said, thanking radio really has nothing to do with what is the right thing from a business standpoint -- which you pay for content. Can you imagine any of sports franchises saying to radio, "Go ahead and broadcast the game, but you don't have to pay us for right to do that ... we think the promotional value is mitigates that payment"...? In what other business would it be acceptable to give away one's work without being compensated without your permission?

How do you respond to those who claim that half of the money that would be generated from a royalty will end up in the coffers of foreign-owned companies and not the artists who apparently need this income?

I don't know where their percentages come from. There are many artists on the radio who are independent artists, whose companies may or may not be owned by foreign companies. The fact is that record companies - all record companies, regardless of where they're from - make a huge investment to sign artists, produce their records and promote and market them. Their investments make it possible for that music to be heard and appreciated by the public. Just like any other business, they're entitled to a return on their investment.

The other fact of the matter is that any income earned by artists is taxable, so the government will be receiving added income. Having this bill pass will put us in line with 95% of the civilized countries in the world, where every other country has a performance royalty. The only countries that don't [have a performance royalty] are China and Iran -- and that's the company the U.S. is in with respect to intellectual property.

All the money collected in countries that have a performance royalty isn't currently paid to artists because we don't have a reciprocal agreement. Millions of dollars of income -- that would go to American recording artists from other countries -- have not been paid. That income is also taxable ... and our country would see the benefit of that taxed money.

It seems that criticism for who are nominated and who wins is part of the territory when it comes to award shows like the Grammys. What kind of stock do you put into these complaints?

No one I'm aware of can make everyone happy all the time. That said, at least during my own tenure here, quite frankly there's been a tremendous improvement on how the critical community views the nominees over the past few years. There was an L.A. Times story couple years ago that actually read, "The Grammys Got It Right." We've been seeing a lot of praise for the nominations over past five years in particular, which has been very gratifying.

Of course, I'm not objective on this point, but I think we've done really fine job as a result of a concerted effort to keep our membership relevant, current and savvy. In our case, the process is all about peers voting for their peers' creative work - it's not about sales and popularity alone

The Academy has always tweaked its categories to fit the changing musical environment. Have you made any changes this year ... and if so, what are they?

We annually review the changing landscape and sometimes add categories, combine categories or reduce categories. This year, we folded the Polka category into the Folk area -- and there are a number of others. All told, we've made under a dozen changes this year.

The major labels are putting out far fewer releases and DIY bands seem to be growing outside of the traditional label system. Should the Academy do more address this reality in the future?

We have addressed that in the past, and we continue to address it on a regular basis. Almost 50% of the entries in the process this year are from independent labels, and several years ago we changed the CD criteria to include digital-only releases. Our net is very broad and wide where we need it to be. We had close to 17,000 entries in this year's process.

The only thing we do try to screen is the at-home artist. Making a recording and just putting it on a MySpace page is really not something that's part of our process. We hope those young and developing artists continue to develop and get to a point where they're a bit more substantial. We have a very broad and open process here; we want to be inclusive.

How has your job changed over the years? Is it as satisfying as it was when you first assumed the post?

I truly feel honored to serve in this role. This is my 7th anniversary here -- and I love it as much today as first day I started. It certainly has evolved over time. As you get to develop your plans, dreams and ideas to constantly build and grow the missions of the Academy, you start to see the fruits of that labor. For me that generally stimulates the next series of ideas. It's an ongoing process.

Are the challenges greater?

They're greater based on those things that are not necessary within our control, such as the tough economic situation, the difficulty our industry had in terms of transition and dealing with new technologies and things we already talked about - the intellectual property issues. Some of the challenges are as great as they've ever been, but it's a privilege to be in a position to hopefully be part of the improvement of conditions for music and the music makers

How do you see the Recording Academy's role in the music industry change in the next few years?

We'll continue to go down the paths that are important for us, to be a leading voice for the creative community - whether the challenges may be something predictable or something unforeseen. What's important is that we'll continue to be the leading voice of the creative community ... and we'll always be there for music people, whether it be through our charities and philanthropy such as MUSICARES; the broad-based Grammy Foundation, whose mission is the archiving and preservation of recorded history; by waving the flag significantly for the importance of music education in our country; being an advocate for our community in Washington, D.C.; or certainly through the Grammy Awards process, which is arguably the most coveted, important award that any music person aspires to.

When you add all that to having opened the Grammy Museum in the past year -- where 365 days a year, the public can learn about music's past, present and future -- all those missions will continue to keep The Academy relevant. Our job is to stay current, get ahead of the curve and continue to work on behalf of the music community.