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Is the Radio Royalty Deal Off?

Musicians and record labels delivered their verdict: They are none too happy with radio broadcasters’ terms under which it will support legislation to require that stations pay performers when their songs are played over their airwaves.

As I reported earlier, there is a dispute as to what was agreed upon last summer, when both sides announced that they had come up with a compromise.

The MusicFIRST Coalition, which represents the record labels and musicians, says that the radio board of the National Assn. of Broadcasters “unilaterally” changed the terms of the compromise when they approved it earlier this week.

Here’s the statement from Tom Matzzie, spokesman for MusicFIRST:

“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 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 United States 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.”

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