One-Sided Approach to Performance Royalty Issue Is a Lost Opportunity (Guest Column)

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Since the dawn of radio, the United States has been and remains the only major country in the world where terrestrial radio pays no royalties to performers or recorded-music copyright owners of the songs it plays. While the more than 8,300 AM and FM stations across the country pay royalties to songwriters and publishers, they have never paid performers or copyright holders, although streaming services and satellite radio do.

Last year, Reps. Ted Deutch (D-FL) and Darrell Issa (R-CA) introduced the bipartisan American Music Fairness Act, which aims to address that situation. “The American Music Fairness Act will protect the artists we know as they make the music we love,” Deutch said. “For the first time, artists would see a piece of the massive profits made on the backs of their creative work. Congress must end the unfair deal AM/FM radio has forced on musicians.” The Senate introduced its version of the bill in September.

In the op-ed below, National Association of Broadcasters CEO Curtis LeGeyt weighs in on the bill, stating that the NAB has attempted to negotiate with the record labels on a royalty rate but has been rebuffed. His op-ed follows in full.

As Congress prepares to finish its business before the holidays, the recording industry is again pushing their supporters on the House Judiciary Committee to move a bill that would impose a job-killing performance royalty on thousands of local broadcast radio stations across the country. The recording industry’s single-minded pursuit of one-sided legislation misses an enormous opportunity to work with broadcasters to grow the entire music economy.

For decades, local radio airplay of music has helped popularize and promote countless performers, sold concert tickets and merchandise, and launched and sustained the careers of superstars and background musicians alike. That is why performing artists thank local radio stations when accepting awards, share stories of hearing their songs on radio and spend time building relationships with broadcasters in the hopes of getting their songs on the air. This connection between radio and musicians benefits tens of millions of Americans every day, who can tune into their local stations to hear their favorite artists and discover new hits without paying a subscription fee.

But the recording industry seeks to upend this mutually beneficial relationship by pushing Congress to mandate a new performance royalty on local radio. This week, the House Judiciary Committee will consider the American Music Fairness Act (AMFA), which would force local radio stations to pay an additional fee for playing music. The result would be less music on free over-the-air radio, cuts to stations’ payrolls and community service to afford these new charges, and a diminished listening experience for Americans.

As I told the House Judiciary Committee during a hearing in February, broadcasters continue to be ready and willing to work with the recording industry to find a comprehensive approach that works for music creators while enabling broadcast innovation.

We have made numerous good-faith offers to the recording industry over the years that would put more money in artists’ pockets while allowing radio stations to adapt their operations to best serve local listeners. This would create a royalty framework for broadcast airplay while enabling more reasonable digital rates that incentivize broadcasters to innovate through streaming. Yet, time and again, the record labels have rejected these offers, instead stubbornly and steadfastly refusing to negotiate (much less providing any formal counteroffer).

The record labels’ embrace of a last-ditch effort for the AMFA to be considered, despite overwhelming opposition from members of Congress, is a lost opportunity to finally achieve a long-lasting solution to this issue. More than 250 members of Congress – including a majority of the House of Representatives – support a resolution opposing a performance royalty on local radio. These lawmakers understand that a one-sided approach will harm local broadcasters and audiences around the country, and ultimately fail artists by leading to less music airplay.

It is frustrating for broadcasters that there continues to be no willingness on the part of the recording industry to come to the table and work to resolve this issue. Numerous times, and as recently as a few weeks ago, the record labels have refused to meet to discuss a mutual path forward. Rather than even attempting productive conversations, the record labels seem to prefer a continued stalemate.

If the record labels are truly serious about advancing the ball – and have the best interests of artists at heart – we invite them to join us at the negotiating table, instead of continuing to reject broadcasters’ good-faith efforts out of hand.