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Posted on: 02/26/2008

MUSICFIRST SUGGESTS QUESTIONS CONGRESS SHOULD ASK NAB: MusicFIRST, the major-label/recording artist lobby created to petition for broadcast radio performance royalties, has a few “questions” for broadcasters (and Congress). Well, they’re more “talking points” than questions, and musicFIRST put out a press release (and placed an ad in Roll Call — click the graphic for a better view) timed to the NAB’s annual State Leadership Conference in DC this week. Read musicFIRST’s 3 questions here. NAB EVP Dennis Wharton responded, “We welcome the debate over which side has been more ‘fair’ to artists — radio stations or RIAA member companies. America’s hometown radio stations expose and promote musicians to 232 million listeners every week. Contrast that with the decades-long exploitation of artists by foreign-owned record labels…”

NOKIA WANTS YOUR STREAM ON THEIR PHONES: Nokia is inviting radio stations around the world to submit station details to make your stream available for their new Nokia Internet Radio service (see RAIN coverage here). S60 3rd edition mobile phones (e.g. N95, E90) can stream registered stations via Wi-Fi and GPRS. Nokia is building a directory that will make it easy for listeners to connect to your stream. Any “legal” radio station can request a free invite here (Look for the “Register Your Station” link on the right).

BBC’S 6 MUSIC A BRIGHT LIGHT IN DAB GLOOM: The Independent (UK) writes: “This month has been a turbulent one for digital radio, with Britain’s largest commercial radio company, GCap, pulling the plug on many of its digital radio investments, saying that take-up of the new medium is too slow to make it profitable. Some pundits believe this sounds the death knell for Digital Audio Broadcasting (DAB). Yet [BBC digital radio station] 6 Music is on a roll. The station, which celebrates its sixth birthday in March, posted its second consecutive record listener figures last month – up 110,000 year-on-year, to a small but significant half a million. In 2007, it was nominated for Radio Station of the Year at the Music Week Awards, recognition to sit alongside a previous win for Best Digital Radio Station at the Digital Music Awards…” More from The Independent here.

FILLING IN THE AFTRA GAPS Terrestrial broadcasters who are wrangling with AFTRA/Arbitron issues online are in need of a remedy, and quick. One answer coming from The Infinite Dial blog is to fill up those commercial slots with more music (and not some tired PSAs). The blog post suggests that broadcasters could sweeten the deal for listeners, letting them know that “they’re getting commercial-free music without paying extra for it.” Get the whole blog post here.

RADIO AND THE INTERNET QUITE A COMBO FOR CANADIANS: What two great media go great together (especially in Canada?)! Radio and the Internet, of course! Canada’s Radio Marketing Bureau is trumpeting a Foundation Research study they say shows radio’s value increases as people use the Internet more. According to the study, while Canadians spent less time overall with media on a daily basis in 2007 vs. 2006, time spent with radio and the Internet increased 5% and 17% respectively. Also, 39% of Canadian adults say they listen to radio while online, and 41% of adults have visited a website after hearing its address on the radio, up 6% over last year. See more here.

RESEARCHER SEES INTERACTIVE AD REV’S TRIPLING OVER NEXT 5 YEARS: RBR reports The Kelsey Group predicts global interactive ad revenues will increase yearly from $45 billion in 2007 to $147 billion globally in 2012, representing a 23.4% compound annual growth rate. Kelsey Group analysts expect that by 2012 the interactive share of global ad spending will reach 21% of total ad revenues (from 7.4% in 2007). The U.S. should see interactive advertising revenues grow from $22.5 billion to $62.4 billion over the next 5 years.

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  1. 1. How can you justify taking someone’s intellectual property and making $16 billion in annual advertising revenue off that property without compensating the creators and owners of the property? This runs against all basic notions of fairness and respect. You might expect this is places like Iran, North Korea and China where there also is no performance right on radio, but not in the United States.

    DY – Record Industry contracts anyone? Seriously, though…Advertisers pay to promote their products over the air to a “captive” audience (broken down by demographics) that they would otherwise be unable to reach. It’s called, oddly enough, “paid advertising”. They pay for the right to promote their products and services to an audience that they could not reach otherwise during specific times of the day. They pay for that exposure because doing so boosts their bottom line. Seems like a basic example of American capitalism to me. So, MY question for MusicFirst would be: When was the last time a top-tier artist “made it big” without being played over-the-air on some form of radio? Which leads me to the next question: Shouldn’t Artists have to pay for that exposure the same way that other Advertisers do? After all, music is a product designed for consumption. It only stands to reason that if an artist wants airtime, they should have to pay like everyone else. Hey, but wait…isn’t that considered Payola (and therefor illegal and anti-competitive). Talk about calling the kettle black.

    2. Why do you deserve a competitive advantage in the music marketplace? Artists and musicians are paid when their music is broadcast on satellite radio, Internet radio and digital music services delivered through satellite and cable television. You pay them when you stream your broadcast signal online, or in the future, through Internet streaming on mobile phones. And artists and musicians are compensated in every other country that is a member of the Organisation of Economic Co-Operation and Development (OECD) – countries like the United Kingdom, Canada, Japan, France, Spain, Belgium, Austria, Germany and Greece.

    DY – A very fair question. Though, a better one would be: Why should one form of broadcast music have to pay a different licensing fee than another? Why do Satellite Radio and Cable get to pay lower performance royalty rates than, say, Webcasting or Simulcasting? They are all streaming music to listeners…seems to me that if you don’t want one medium to have a “competitive advantage” over another, they should all have to pay the same rates. Don’t you agree?

    3. Which of your leaders is right: David Rehr, president of NAB, or W. Russell Withers, head of the Withers Broadcasting Group and chairman of the NAB Radio Board? Mr. Rehr calls paying artists for their work product a “performance tax.” Really, the loophole in copyright law he is trying to salvage is merely an elaborate payment avoidance scheme. On the other hand, when Mr. Withers was questioned before the Senate Commerce Committee during a hearing last year, he said, “I disagree with ‘performance tax.’ It’s a performance fee.” What is wrong with paying a fee for product that makes you money?

    DY – And here, again, comes the question: Why should artists get free exposure to the public that advertisers have to pay for? Doesn’t that give Artists a “competitive advantage” over, say, the MPAA or Nike?

    I think you’ll agree just how ridiculous these arguments are. I for one do believe that artists should be paid for their products and creativity…and that the rate should be fair across all broadcast mediums (whether over-the-air radio, webcasts, simulcasts, satellite, or cable). The last time I checked, it was considered “un-American” for the Government to legislate free-market companies into bankruptcy. The real problem with this whole situation is the fact that it basically boils down to a “chicken or the egg” argument. Without artists, radio has nothing to play. Without radio, Artists are unable to get airtime (and access) to those 235 million listeners, and therefore cannot continue to produce music (because no one is buying their stuff, because no one has ever heard of them, and because everyone has to eat). This whole spat is so lacking in transparency that it’s just ludicrous. It has so very little to do with the “artists”. What we’re really talking about here is a huge corporate industry trying like hell to protect an otherwise dead business model and another huge corporate industry trying like hell to manage costs and stay profitable. Neither one can take the high road here (though I do believe that radio has a better leg to stand on than MusicFirst).

    To me, the solution is simple. Artists should be paid for their work, and the rate should be equal across all broadcast mediums AND it should be a fair percentage of revenue (garnered from music listening). It is in absolutely NO ONES best interest to have smaller stations go dark under the weight of performance royalties set at idiotic rates, nor to have artists stop making music because they cannot earn a respectable living doing it.

    David · Feb 26, 06:27 AM · #

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