Every service out there that provides music for the public's listening pleasure pays the artists and labels who create and promote the music, except for one: Radio. Yes, both terrestrial and sattelite radio pay royalties to songwriters, but not the artists who perform them.
Every service out there that provides music for the public's listening pleasure pays the artists and labels who create and promote the music, except for one: Radio. Yes, both terrestrial and sattelite radio pay royalties to songwriters, but not the artists who perform them. As you can imagine, with the largest breadwinners in the industry not writing their own songs and their labels not seeing a dime directly from these stations, there's been a war brewing between the National Association of Broadcasters and the aforementioned parties for quite some time. Yesterday, the front lines clashed on capitol hill. Read some memorable quotes from testifiers below, and let us know who you think should win this battle in the comments.
(Billboard.biz) From Reps of Pandora, NARAS, RIAA, NAB's Testimony at House Radio Hearings
A day after Clear Channel brokered a deal with Big Machine to pay sound recording performance royalties, music execs and interest group reps gathered on Capitol Hill to offer their testimony at a Congressional hearing entitled the "Future of Audio" sponsored by the Subcommittee on Communications and Technology. Here witnesses testified with often divergent views on how they believe the digital and terrestrial radio industry should (or shouldn't) be regulated. Below are excerpts from Ben Allison, a jazz musician and member of the Board of Governors of NARAS; Tim Westergren, Founder and Chief Strategy Officer of online radio site Pandora; Steven Newberry, CEO of the Commonwealth Broadcasting Corporation testifying on behalf of the National Association of Broadcasters; Cary Sherman, Chairman and CEO, Recording Industry Association of America culled from their testimony transcripts listed on the House Energy Committee's website.
Ben Allison, Bassist and composer, member of the Board of Governors of National Academy of Recording Arts and Sciences:
"Terrestrial broadcasters have an inexplicable "free ride" when it comes to performance royalties. They are exempt from paying performers any royalties when they use our recordings to fuel their multi-billion dollar industry."
Tim Westergren, Founder and Chief Strategy Officer, Pandora:
"Last year, on revenues of $274MM, Pandora paid $137MM in performance fees to performing artists and labels, or 50% of revenue. That same year, Sirius/XM, on revenues of $2.74B, paid $205MM, or 7.5% of revenue; and broadcast radio, on revenues of roughly $15B, paid zero. Now I am fully supportive of fair compensation for artists. I'm a musician, and I strongly believe that radio can and should reward musicians for the use of their work - both songwriters AND performers. But this lack of a level playing field is fundamentally unfair and indefensible."
Steven Newberry, CEO of the Commonwealth Broadcasting Corporation, testifying on behalf of the National Association of Broadcasters:
"Record labels and performing artists profit from the free exposure provided by radio airplay, while local radio stations receive revenues from advertisers that purchase airtime to sell their products and services."
Cary Sherman, Chairman and CEO, Recording Industry Association of America :
"The bottom line is that every platform that (legally) plays music pays to do so - except for one. AM/FM radio stations use music to draw billions of dollars in advertising revenue for themselves, but they don't pay a cent to artists, musicians and sound recording owners who make the music they use."