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GRAMMYs
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Statement Re: The Local Radio Freedom Act recording-academy-statement-re-local-radio-freedom-act

Recording Academy Statement Re: The Local Radio Freedom Act

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Daryl Friedman
Advocacy
Dec 13, 2017 - 12:12 pm

“Today, the National Association of Broadcasters (NAB) claimed victory for a non-binding resolution that in reality is another nail in radio's coffin.  The Local Radio Freedom Act (LRFA), otherwise known as the Loss of Radio’s Future Act, shows that the NAB would rather fight with artists than fight for its survival.  It’s no secret that radio struggles to remain relevant to younger audiences. The NAB has an opportunity to work with creators to ensure radio’s future by establishing a fair framework that includes a performance right for terrestrial radio while allowing for radio’s growth. The window is closing to move broadcasting into the 21st century.”

 

Daryl Friedman
Chief Industry, Government & Member Relations Officer
Recording Academy

streaming_music_advocacy-1083228860.jpg

Photo by Thomas Trutschel/Photothek via Getty Images

News
What Streaming's Record Year Means For Radio streaming-earns-major-labels-record-income-radio-lobbies-outdated-loopholes

Streaming Earns Major Labels Record Income As Radio Lobbies For Outdated Loopholes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

https://twitter.com/musicFIRST/status/1098963875964375040

ICYMI: “The NAB will dedicate months and spend millions accumulating names on a motion that falsely protects ‘local radio’ and that will never become law.” Our full statement on @nabtweets’ Local Radio Freedom Act here: https://t.co/eOiN9Rc5zG

— musicFIRST (@musicFIRST) February 22, 2019

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 

GRAMMYs
News
Want to sound like a policy insider this weekend? want-sound-policy-insider-weekend-here-your-cocktail-party-comment-week-34

Want to sound like a policy insider this weekend? Here is your Cocktail Party Comment of the Week:

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THE GRAMMYs
Advocacy
Aug 18, 2017 - 9:20 am

"Did you hear that Amazon is looking to get into the ticket market? More companies selling tickets could bode well for music fans tired of scalpers and bots driving up concert prices."

Read more about the passage of the BOTS Act here. 

Spotify Logo

Spotify Logo

 

Photo: Chesnot/Getty Images

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Spotify Introduces New Anti-Creator Mode does-spotifys-new-discovery-mode-resemble-anti-creator-payola

Does Spotify's New "Discovery Mode" Resemble Anti-Creator "Payola?"

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At a time when the music ecosystem is struggling, Spotify is encouraging creators to decrease their already low royalty rate in exchange for additional promotion
Advocacy
Nov 11, 2020 - 4:21 pm

At a time when more are calling for reinventing steaming rates to better artist payout, Spotify is launching a new mode that invokes past concerns with payola infractions within the music community. Spotify's "Discovery Mode" offers creators the opportunity to increase their public visibility in exchange for a diminished royalty rate, which currently fluctuates between $.003 and $.005 per stream reportedly.

https://twitter.com/NME/status/1326129618156457986

Acts will be able to get on the right side of the platform's recommendation algorithm... at a cost https://t.co/S8hp2nBogM

— NME (@NME) November 10, 2020

Payola, the practice of requiring compensation in return for airplay by broadcasters, decreases the diversity of music included in airplay and provides an unfair barrier of entry for smaller artists. While current antiquated payola legislation does not extend to digital streaming services, Spotify's anti-creator behavior of enticing struggling creators to further reduce their already low royalty rate in order to stay competitive with their music community peers is reminiscent of past payola practices. 

"Spotify's promotional royalty rate is yet another example of how the company avoids paying music creators their fair share," said Daryl Friedman, the Recording Academy’s Chief Advocacy Officer. "It's a predatory tool that can be likened to payola, and it's troubling that Spotify introduced this at a time when music creators are seeing their livelihoods devastated amidst the pandemic. With Spotify payouts already so low, I don't see how this experiment will benefit any musicians who are already struggling to earn a living wage."

The Recording Academy has a history combatting these anti-creator "pay-for-play" practices. In 2007, the Recording Academy penned a letter to then-Federal Communications Chairman (FCC) Chairman Kevin Martin in support of the FCC's pending payola investigations into Big Radio. Without commenting on individual investigations, the Academy urged the FCC to continue oversight to "ensure that future conduct in violation of the payola laws will not occur" and to intervene if any such conduct occurs.

https://twitter.com/pitchfork/status/1325925397427523588

Some have likened Spotify's latest feature to payola https://t.co/Zy0BzTwe6O

— Pitchfork (@pitchfork) November 9, 2020

At a time when COVID-19 has resulted in closed venues and canceled tours, causing a tremendous amount of financial distress for the entire music ecosystem, artists and creators need fairer compensation. Yet instead of providing a lifeline, Spotify's flirtation with "pay-for-play" will further damage the financial health of small-time music creators who want to remain competitive on their platform.

Spotify & Other Streaming Giants Are Fighting Songwriter Royalty Increases…Still

GRAMMYs

Photo: Andras Polonyi / EyeEm

News
Recording Academy Champions The HITS Act recording-academy-champions-hits-act-which-supports-independent-music-makers%E2%80%99-recovery

Recording Academy Champions The HITS Act, Which Supports Independent Music Makers’ Recovery

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The Help Independent Tracks Succeed Act lets creators fully expense production costs for new music up-front to stimulate reopening of the music economy
Advocacy
Jul 31, 2020 - 7:00 am

Today, the Recording Academy joined Rep. Linda T. Sánchez (D-Calif.) and Rep. Ron Estes (R-Kansas) to announce the Help Independent Tracks Succeed (HITS) Act, which allows an individual to fully expense for tax purposes the cost of new studio recordings on their taxes, up to $150,000, within the same year of production.

Music creators are among the American workers hardest hit by the coronavirus pandemic. Tours are cancelled, venues, bars, and restaurants are shuttered, and recording studios remain closed. As independent artists and producers look for a new path forward, the HITS Act creates a foothold for recovery. Without it, the costs of making new music may be prohibitive to creators following months of lost income.

"The Recording Academy is proud to have worked alongside Reps. Sánchez and Estes to develop the key provisions in the HITS Act," said Harvey Mason jr., Chair and Interim President/CEO of the Recording Academy. "The HITS Act will make a meaningful impact and help ease the financial burden for thousands of independent creators getting back on track, eager to share their creativity with the world. It will inspire new music and create opportunities for many of the vulnerable professionals in our community to persevere during these uncertain times."

Currently, individual recording artists and record producers are required to amortize production expenses for tax purposes over the economic life of a sound recording, typically 3-4 years. The HITS Act allows artists and producers to choose to deduct 100 percent of their production expenses for records created in the United States in the year such expenses are incurred, in the same manner that qualified film and television production expenses are allowed to be expensed. Expenses can include studio equipment, studio rental fees, staff costs, electricity, studio musicians, and much more.

"We are living through tough times and nothing helps you escape like turning on your favorite album," said Rep. Sánchez. "Similar to many families and workers across the country, the coronavirus has also had an enormous impact on music makers. Gigs have been canceled, studios shuttered, and creative writing sessions postponed. I'm proud to introduce the HITS Act with Rep. Estes. Our bill will provide small, independent creators with a bit of help getting back to work, making the music we turn to in good times and bad."

"Music is a powerful language that connects people of varying generations, backgrounds and experiences," said Rep. Estes. "The men and women who make music — either through writing, singing, playing or producing — deserve to have the same tax benefits as artists in the film, television and live theater industries. The HITS Act is sound legislation that supports our creative communities throughout the United States and encourages music makers of all sizes and notoriety."

Many music creators watched their incomes disappear as the pandemic ushered in a new normal of closures and cancellations. The median income for a professional musician is less than $25,000 a year, and independent music professionals will be among the last to return to work as the nation gradually reopens. As the only organization representing all music creators, the Recording Academy will continue to support government assistance that will help music creators navigate their way through this unprecedented time and subsequent recovery period.

Academy Endorses New Legislation To Support Creators, Venues & Small Music Businesses

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Some of the content on this site expresses viewpoints and opinions that are not those of the Recording Academy. Responsibility for the accuracy of information provided in stories not written by or specifically prepared for the Academy lies with the story's original source or writer. Content on this site does not reflect an endorsement or recommendation of any artist or music by the Recording Academy.