Traditional AM and FM radio stations currently are not required to pay performance royalties, and record labels, including Warner, and artists are pushing for the U.S. government to establish a performance right that would allow labels and artists to make money from plays of songs on AM and FM stations.
The partnership with Warner is the first such deal between Clear Channel and a major label. The other two big record labels are Universal Music Group and
Bob Pittman, the chief executive of Clear Channel, said the agreement with Warner Music is based on the arrangements with the indies.
"What we're doing is redefining the radio and music label relationship for the digital age," Pittman said in an interview. "The holy grail is that we build a marketplace that is robust, growing and big, and I think if we can succeed in that, it's great for the consumer and also it's revenue that feeds us all."
Stephen Cooper, Warner Music Group's CEO, said the partnership with Clear Channel will be a promotional boon.
"This is, in a very well organized and thoughtful fashion, marrying Warner's content with Clear Channel's massive distribution capabilities," Cooper said. "What that means to our artists is that we'll be able to capitalize by exposing our artists to hundreds of millions of users. We are very confident that that exposure will help drive Clear Channel's business and the success of our artists and music."
This comes as legislative action could be on the way.
In July, Rep.
“The agreement shines a spotlight on the need for every broadcaster to compensate every recording artist whose work it uses,” SoundExchange said. “We firmly believe only a legal performance right will create the opportunity for all U.S. artists to receive payments they are rightfully due from all broadcasters.”
Broadcasters have been opposed to the legislation from Watt, which echoes a similar bill he proposed in 2009.