Royalty Bill’s Chances Fading


Washington Research Group Concept Capital‘s Paul Gallant says in a new report that chances of the Performance Rights Act passing have downgraded from a 60% likelihood to 40%. The Performance Rights Act would force radio stations to pay royalties for playing music on top of the usual array of song writer royalties that have always been paid.

This is good news, but one cannot help but look askance at it. After all, the House and Senate Judiciary Committees have both approved the legislation in recent months, and a meeting was held between broadcasters and record labels to discuss a possible compromise. Both of these occurrences would seem to denote victory rather than failure for the “performance tax”. So why do we have better odds now?

FMQB boils it down to a few simple statements:

[…] why the possibility is less likely, first saying that broadcasters are doing an effective job of building opposition to the legislation. The NAB has gotten 27 Senators and 253 House members to sign a resolution opposing the Performance Rights Act. Secondly, broadcasters have gotten traction with arguments that a new fee could have damaging consequences for a large number a radio stations – particularly in a difficult advertising environment – and that a disproportionate share of endangered stations are minority-owned.

But wait, there’s more. As RadioInk observes the political angles to all this have quite an impact on these odds as well:

Gallant also notes that members of Congress are “typically more sensitive to broadcasters’ policy agenda” as elections near, and points to the leadership of new NAB President/CEO Gordon Smith, who joined the organization officially late last month. Though he notes that Smith is restricted from lobbying directly for another year, Gallant writes, “We view his stature, bipartisan reputation, and skill set as a new and positive factor for broadcasters in the radio royalty battle.”

There, now that you see the basic reasoning, it makes perfect sense. But that does not mean we in the industry can rest on our laurels; the fight isn’t over yet! In the world of politics, there is always the chance of some surprise last-minute deal or maneuver by the opposition. Senate Judiciary Chairman Patrick Leahy (D-VT) and House Judiciary Chairman John Conyers (D-MI), the bill’s sponsors, continue to spare no efforts to pass this potentially damaging piece of legislation.

Then there is the Local Radio Freedom Act, which is also winding its way though the halls of government. It declares that “Congress should not impose any new performance fee, tax, royalty, or other charge relating to the public performance of sound recordings on a local radio station for broadcasting sound recordings over-the-air, or on any business for such public performance of sound recordings”. This piece of legislation is gaining ground and needs your support, especially now that support for the PRA seems to be waning.

You can follow both bills online easily on Open Congress:

Image: billselak / CC BY-ND 2.0

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