Fair Play, Fair Pay Act of 2015 would require radio to pay for music

A broad coalition of recording artists, labels, managers and other industry players are lining up in support of a bill introduced in Congress on Monday designed to require forms of terrestrial and digital radio to pay royalties to musicians for use of their recordings.

The Fair Play, Fair Pay Act of 2015 is co-sponsored by congressional representatives Jerrold Nadler (D-N.Y.), Marcia Blackburn (R-Tenn.), John Conyers Jr. (D-Mich.) and Ted Deutch (D-Fla.) and would terminate broadcast radio’s long history of using sound recordings without paying performance royalties. The bill would also change the way satellite, Internet and streaming services pay for the music that are integral to their businesses.

“For decades, music services have gotten away with building their business on the backs of hardworking musicians, paying unfair rates -- and in the case of the $17.5-billion radio industry, paying nothing at all -- for the music they use,” said Michael Huppe, president and CEO of SoundExchange, an independent nonprofit performance rights organization that collects and distributes digital performance royalties.

“The Fair Play, Fair Pay Act introduced today will bring much needed reform to the music industry and addresses many of the issues that plague the recorded music industry,” Huppe said in a statement. “It is time that we properly pay the artists who put so much hard work into creating the music at the core of these services. If it weren’t for them, these stations would be broadcasting little more than static.”

The decades-old debate has pitted musicians, record companies and music publishers against broadcasters, who in the early days of radio were allowed to program recorded music for free because it was considered promotional use that stimulated listeners to buy those recordings.

The radio industry’s leading trade organization, the National Assn. of Broadcasters, has vowed to fight the new bill, saying it would have a harmful economic impact.

“NAB will strongly oppose the legislation reportedly being introduced by Rep. Nadler on Monday,” NAB Executive Vice President of Communications Dennis Wharton said in a statement. “It is disappointing that this bill retreads years-old policy positions rather than advancing the copyright dialogue through policies that help grow the entire music ecosystem. ...

“A little over three months into the new Congress, 147 House Members and 11 Senators already agree that the fees proposed by Rep. Nadler would kill jobs, hurt artist promotion and devastate local economies across America,” NAB’s statement said.

Efforts to end free radio use of recorded music have heated up in recent years as sales of music -- both physical recordings and digital downloads -- have dropped dramatically as new technology has given rise to services allowing consumers to hear music on computers, smartphones and other devices without purchasing it.

Some satellite and Internet radio services similarly have exploited an absence of federal copyright protection to recordings made before 1972 by refusing to pay royalties on music they play from the Swing Era of the 1930s and ‘40s through the rise of rock and R&B in the 1950s and ‘60s.

“This bill brings music licensing for sound recordings into the 21st century,” Ken Howard, president of the Screen Actors Guild/American Federation of Television and Radio Artists, said in a statement. “AM/FM stations will finally pay royalties on the sound recordings they broadcast. Right now, performers receive nothing -- no royalties at all -- for use of their recordings on AM/FM radio. This is something our members, including the late and great ‘Chairman of the Board’ Frank Sinatra have fought for decades to establish.

“This bill establishes a uniform fair market value royalty standard for all services and ensures that creators of sound recordings made prior to 1972, some of our most beloved and valued music, are fairly compensated when their music is played,” Howard added.

Recording Academy President Neil Portnow has been a vocal advocate of legislation to require royalty payments on all recorded music used for commercial purposes, and said in a statement, “Introducing the Fair Play, Fair Pay Act ... brings fairness to many issues facing music creators in a comprehensive approach -- ‎a concept and position advanced and championed by the Recording Academy and its broad constituency.”

Broadcasters say they favor fairness concerning payments, but instead support two other measures, the Local Radio Freedom Act (H. Con. Res. 17) in Congress and a companion Senate bill, S. Con. Res. 4.

“NAB stands ready to work with Congress on a balanced music licensing proposal that promotes innovation and recognizes the benefit of our free locally-focused platform to the benefit of artists and listeners,” Wharton said.

The musicFirst coalition of music organizations notes that, “alongside China, Iran and North Korea, we are one of only a handful of countries that don’t pay performers when their music is played over AM/FM radio. Unfortunately, because we refuse to reciprocate, music creators in the United States are denied performance royalties for their international airplay. That is a loss for performers that is estimated to cost the United States economy $100 million or more a year.”

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