Performance rights orgs say payment disparity not addressed

As a congressional committee prepares to hold its first hearings on the Internet Radio Fairness Act, performance rights orgs ASCAP, BMI and SESAC, as well as the Nashville Songwriters Assn. Intl., have issued a joint statement opposing the bill.

In an open letter addressed to the House Subcommittee on Intellectual Property, which will conduct the Wednesday hearing, toppers from the PROs voiced concerns that the bill fails to address issues with the royalties paid by digital broadcasters to songwriters and publishers and contains language broad enough to have “unforeseen consequences on the business practices of PROs.”

The bill, over which the music industry is sharply divided, effectively seeks to redefine the statutory rates paid by Internet radio broadcasters to SoundExchange in relation to those paid by satellite and terrestrial radio, all of which are currently calculated by different means. The PROs complain the bill fails to address the imbalance — a nearly 12-to-1 disparity, the groups claim — between the rates webcasters pay to SoundExchange vs. those paid to PROs.

“Any congressional examination of online music licensing issues needs to address this serious, broader issue to ensure that the interests of writers and publishers — the very creative foundation fueling the music industry — are not further deteriorated,” the letter read.

The IRFA is supported by the likes of Pandora and Clear Channel and opposed by the RIAA, the NAACP, SoundExchange and a coalition of recording artists.

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