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Radio Station Owners Petition For Greater Consolidation

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Eight stations in a single market is apparently not enough for already-consolidated station owners — are they really representing radio's best interests?
Philip Merrill
Advocacy
Dec 5, 2018 - 4:37 pm

Is big radio getting bigger? The Federal Communications Commission (FCC) is expected to issue a new Notice of Proposed Rulemaking for comments about media ownership regulation of audio programming later this month. In anticipation, the National Association of Broadcasters (NAB) has submitted its latest arguments for special treatment while musicFIRST and the Future of Music Coalition submitted joint comments opposing greater consolidation.

The FCC was created in the 1930s to ensure that America's broadcast and wire communications functioned efficiently and in the national interest, without discrimination or unreasonable charges. As the voice for the nation's radio and television broadcasters, NAB speaks for the industry and its owners. As the FCC prepares to review caps limiting how many radio stations can be held by a single owner, NAB has stepped out to argue why it believes station owners should have lighter restrictions.

America's communications infrastructure is no longer dominated by telephone lines and broadcast towers, but the FCC remains the primary agency with jurisdiction over the rules of the airwaves. As summarized at Billboard, the dueling submissions present competing views of how government should participate to ensure a competitive marketplace. The established and already consolidated owners of radio stations are fighting the rules limiting them to ownership of only six FM stations and two AM stations in each of America's major markets. Meanwhile musicFIRST and artist groups view the radio industry as already highly consolidated, leading to consequences for types of programming that discriminate and reduce the number of independent voices.

"Such consolidation … causes homogenization of AM/FM music playlists," they argue, "such that listeners of commercial AM/FM music-driven stations now hear a substantially less diverse swath of artists and recordings than before consolidation."

On the other hand, NAB's answer to the need for more competition is in favor of more consolidation, falsely believing that greater market presence, with less diversity, is the only way for radio stations to compete with the diverse options presented by digital and streaming platforms.

In their comments, the music organizations also call out the unfair legacy advantage radio station owners enjoy that they do not need to pay musical performers for the use of their recordings.  But for NAB, considering this copyright concession is "outside the scope of [the FCC's] regulatory jurisdiction and expertise." It should be clear that both the arguments for consolidation and for non-payment of royalties recommend taking a point of view that favors current owners.

Clearly, NAB wants the FCC to take internet competition into account so that radio itself can be made less competitive, to improve its financial stability in competition with high-tech providers playing by a different set of rules. But NAB wants the FCC to stay hands-off about radio's unfair advantage of not paying performance royalties. It's questionable whether such arguments genuinely put the interests of broadcast radio first. They seem to favor the financial interests of radio's struggling established owners, who seek more special advantages.

The cost of perpetuating radio's carve-out from market forces and competition guidelines has retarded the progress of its own platform. Our national culture is less interesting due to this continued protection, but big radio wants the freedom to continue to fail in their established old ways, by gaining even more special protection from the government.

Changing radio and ending its fossilized protections is an opportunity to show what these towers and stations can do. NAB should tune into the new frequencies and not be stuck arguing that eight stations in one market is too strict a limit.

Learn More About The Performance Right For Sound Recordings

GRAMMYs

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How Working Musicians Will Win When Congress Passes Radio Performance Right

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In honor of Labor Day, take a look at how music unions and the musicians who belong to them would benefit from finally getting the AM/FM performance right they deserve
Nate Hertweck
Advocacy
Aug 30, 2019 - 2:35 pm

"While radio rocks out and cashes in over Labor Day, the performers you hear get paid nothing. There's a better way…" –Conversations In Advoacay #64

Labor Day comes around each year to remind us of the precious power and intrinsic value of hard work in our culture. For working music makers, compensation for their hard work can be tricky to track down, as music permeates into so many spaces in our lives. But in the realm of broadcast radio, artists and producers still don't get paid for the performance of their music, songs they worked hard to create.

Imagine that: AM/FM radio stations can use any song ever recorded without paying the artists, performers or producers a dime. That's a lot of hard work gone unrecognized.

Now imagine this: if royalties were paid for music played on terrestrial radio, it would not only benefit the featured artist on your favorite track, but also the studio musicians and backing vocalists who performed on the track too. That’s because a portion of the royalties would flow through the AFM & SAG-AFTRA Intellectual Property Rights Distribution Fund. The fund then distributes royalties to entitled singers and musicians, and while only union members are eligible to receive foreign royalties, all U.S. royalties are paid out without regard to membership. Clearly, this would put money in the pockets of all the music makers you hear over the airwaves.

This is why AFM and SAG-AFTRA, along with the Recording Academy, are founding members of musicFIRST, which works to ensure music creators get fair pay for their work, on AM/FM and wherever and however it is played. Together we all fight to ensure music creators receive fair pay, regardless of what format utilizes their music.

So as you fire up the grill on Labor Day and dial in your favorite station, consider the hard work put in by the artists and producers you hear and contact your Members of Congress to urge them to finally establish a long overdue performance right so we can keep the music playing.

Let Your Representatives Know You Stand In Support Of Music Creators' Rights

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Photo by Thomas Trutschel/Photothek via Getty Images

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Streaming Earns Major Labels Record Income As Radio Lobbies For Outdated Loopholes

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Under the newly passed Music Modernization Act, artists and songwriters alike will benefit from streaming profits, yet radio still seeks unfair privilege to pay no performance royalties
Philip Merrill
Advocacy
Feb 27, 2019 - 12:57 pm

Music's big three labels had a landmark year in 2018. Reviewing data compiled by Music Business Worldwide, Rolling Stone reported $19 million per day of major label revenue from streaming in 2018, which can easily be considered as a massive triumph for major labels. Thanks to the Music Modernization Act, which was signed into law last year, this money will not only be shared with the artists but a fair market share will now go to the songwriters, too.

This is good news all around for monetizing the new industry. Looking at reported revenue from Sony, Universal and Warner, MBW tallied more than $6.9 billion in 2018 revenue from streaming. Compared to 2017's total of $5.3 billion, that is a $1.6 billion increase. These figures prove that, even in the music business economy where technical innovation can outpace due compensation legislation, there is real growth to be made.

But as streaming platforms find their footing, older formats struggle to evolve. In what has become a meaningful tradition for radio broadcasters, Congress has reintroduced the Local Radio Freedom Act (LRFA) once again, a resolution seeking to exempt broadcast stations from the burden of paying musical performers anything for playing their recordings. Meanwhile in the same world where streaming and innovation have made growing revenues real, it seems hard to believe that the past is a safe guide for terrestrial radio’s future, but still believers in LRFA seem to reject doing things differently.

On Feb. 14, the non-binding Local Radio Freedom Act was introduced into the Senate with its House companion introduced on Feb. 19. The National Association of Broadcasters expressed the gratitude of “America’s hometown broadcasters” on Feb. 20 in support of LRFA resolutions. However, this is a strange ritual that continues Congress after Congress in an attempt to deny paying artists, musicians and producers for the use of their sound recordings. The resolution seeks to entrench the U.S. as the only free market country in the world without a performance right for artists, joining North Korea, Iran, and China. As the industry, and the world, embrace innovative new platforms that benefit artists, platforms and fans, the radio industry doubles-down on outdated laws and technologies. 

Music Business Worldwide's report also shows declining physical sales, which is nothing new, but its numbers surrounding streaming give cause for hope in fairly monetizing and compensating the platforms replacing physical. Radio, on the other hand, has seemed to resist this type of progress. Holding back an industry and then using its money troubles as a reason to fight change is what the LRFA stands for, not love of radio.

Radio Station Owners Petition For Greater Consolidation 

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Lawmakers and the Academy celebrate together
Photo: Recording Academy

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Successful Year for GRAMMY Advocacy Culminates at Celebration in New DC HQ

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A bipartisan bash brought together music's creators and top lawmakers at our new Advocacy offices in the nation's capital
Philip Merrill
Advocacy
Dec 19, 2018 - 4:09 pm

The Recording Academy's hard work on Capitol Hill has paid off in 2018 with real progress, and the time to celebrate has come! On Dec. 12, the GRAMMY-nominated songwriter, Julia Michaels, joined the GRAMMY Advocacy staff, lawmakers, Congressional staff and stakeholder groups—over 200 guests in total—for a holiday open house and ribbon-cutting ceremony at the Recording Academy's new offices in downtown Washington, D.C. The new space is intended to be a home for Academy members visiting the nation’s capital, and help better unite the policy community—in bipartisan fashion—with the music creator community.

Julia Michaels at the GRAMMY Advocacy open house.

“I want to thank the Recording Academy for being here in DC to represent those of us who make music” --GRAMMY nominee Julia Michaels at the GRAMMY Advocacy open house.

This special unity was on display throughout last week’s celebration, including during the official ribbon cutting ceremony that brought together musicians like Michaels and Academy Trustee and singer/songwriter Tracy Hamlin with lawmakers Rep. Debbie Wasserman Schultz (D-Fla.), Rep. Ron Estes (R-Kan.) and Rep. Steny Hoyer (D-Md.). Hoyer, who was recently elected Majority Leader for the 116th Congress, addressed the crowd praising the Academy for its efforts and successes in Washington.

Earlier in the festivities, Michaels had a bipartisan visit with Reps. Kevin McCarthy (R-Calif.) and Norma Torres (D-Calif.). McCarthy will be the top Republican in the House next Congress and continue to serve alongside the aforementioned Hoyer as co-chairs of the Recording Arts and Sciences Congressional Caucus. Their bipartisan partnership on behalf of music led to 2018's historic victory when the Music Modernization Act was signed into law after having unanimously passed Congress.

Reps. David Cicilline (D-RI), Ted Deutch (D-Fla.), Sheila Jackson Lee (D-Texas), and Grace Meng (D-N.Y.) also joined in to celebrate with us. D.C.-based producer, engineer and songwriter—and recent GRAMMY nominee—Matt Squire entertained the crowd on Pro Tools, demonstrating how a song is brought to life as a recording, from start to finish. Michaels also addressed the importance of what happens after that, bringing the creative process full circle in context for the crowd.

The year of progress we've had and the passage of the Music Modernization Act are so important because the professionals who create the music we all love — the music that unites us — have to make a living to pour their time and talent into their craft successfully. Cheers and more to come in 2019—with a new home in D.C.!

GRAMMY Advocacy In Action: The Music Modernization Act & Beyond

Cary Sherman

Cary Sherman

Photo: Courtesy of RIAA

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RIAA Chairman/CEO Cary Sherman, A Music Champion, To Retire

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Sherman's unique position as an advocate for the major music labels helped guide the challenging transition to today's thriving digital marketplace for music
Philip Merrill
Advocacy
Dec 12, 2018 - 1:32 pm

On Dec. 31 a major change of the guard at The Recording Industry Association of America (RIAA) will see former President and current Chairman/CEO Cary Sherman retire, with his responsibilities taken over by current President Mitch Glazier as of January 2019. While the Recording Academy represents all music creators, the RIAA represents the major music labels. Sherman's leadership steered a steady course through challenges including internet piracy and intellectual-property legal developments that led to today's successful digital ecosystem.

"Business models change, and shifts in policy positions follow," Sherman said in his speech at MIDEM on June 8, 2018. "Be alert for changes in business, and then look for the opportunity to find common ground, even with, in fact especially with, those who once were adversaries."

Sherman made the point that changing developments have forced artists to learn more about the music business and be prepared to shift position as the high-tech landscape continues to evolve. This has been just one of many areas where the Recording Academy and the RIAA found their own common ground. At the Academy's District Advocate day on Oct. 24, more than 1,500 of our members lobbied for constructive intellectual property policy changes — a powerful grassroots mobilization that was inconceivable in the days before digital changed the music business.

Accepting The Music Business Association (Music Biz) Presidential Award for Outstanding Executive Achievement on May 16, 2018, Sherman expressed pride in being the first attorney to achieve that honor. He described his first intellectual property assignment as a young lawyer in 1974. "I knew nothing about copyright or legislative work," he said about his first three weeks researching the potential establishment of a broadcast performance right for sound recordings. This is a struggle that continues to this day as broadcasters consolidate power without paying fair royalties to performers.

"For those of you who think that music policy and government regulation are not relevant to you, think again," he said in his acceptance speech. "Whether you're an artist, label, a songwriter, a publisher, a digital music service or a start-up, governmental policy will determine how you can operate and how you can earn money — or not."

On Nov. 15 in Washington, D.C. Sherman's retirement bash hosted a high-powered crowd of 300, including CEOs and lawmakers, filled with memories and gratitude for his steady leadership as digital ate half of the music industry's revenues and the music business struggled to successfully respond. His final day on the job will be Dec. 31 and his future plans include returning to "taking piano lessons." He described the signing of the Music Modernization Act into law — another area of mutual Recording Academy and RIAA support — as "the icing on the cake" of his storied career as the major labels' leading representative.

With major copyright litigation and multiple updates of copyright legislation behind him, Sherman's biggest regret is that radio still does not pay broadcast performance royalties — the assignment that first started his career in intellectual property in 1974. "That's the most gaping hole in our rights," he concluded. Sherman will be happy to note the quest to close this loophole will continue in his absence, and his many years of hard work toward a fair payment system for performers will not be in vain.

GRAMMY Advocacy In Action: The Music Modernization Act & Beyond