There are hearings this week in Congress on whether non-satellite radio stations should pay a performance royalty for the music they play. They have not had to do so, unlike the radio industries in other parts of the world, for historical reasons. The music industry has been lobbying to right this decades-long wrong, and its arguments seem to have sympathetic ears in Congress — notwithstanding the political capital of the National Association of Broadcasters. I’m not always sympathetic to the arguments of the labels, but in this case, I am.
Quite simply, I don’t think U.S. terrestrial radio has a leg to stand on. They claim that they serve a promotional role for the music they play and that they should therefore be exempt (while Internet and satellite radio isn’t). As Billy Corgan testified, there is no doubt that radio is a heavy promoter of music, but so what? Stations are still using a copyright, and the owner of the copyright ought to get paid for it — especially if their IP can be used without an individually negotiated license. The NAB’s argument is absurd: Radio stations will pay Rush Limbaugh for his content and go after people that try to re-broadcast it, but they won’t do the same for the music they play?
It is time for this to be changed, and I hope it happens. It may well hasten the departure of music from FM radio, but that would be a market decision. In fact, some enterprising labels may calculate that they do indeed derive a greater promotional benefit and offer to waive the royalties for stations playing their repertoire. But that should be the prerogative of the copyright holder.