Notes From the P&E WingFAIR PAY FOR AIRPLAY 8/01/2007 8:00 AM Eastern
As a member services division of The Recording Academy®, the Producers & Engineers Wing is involved in numerous advocacy initiatives aimed at improving the lives of those who create music. An issue that's currently heading to centerstage is the matter of terrestrial radio performance royalties, with pending legislation that is of great significance to music producers.
This past June saw the launch of one of the most important fight for music creators' rights in a generation. Ironically, this fight actually began a generation ago — 50 years ago, as the first Grammys were just taking shape, Frank Sinatra and other artists raised the issue of royalties for the airplay of their recordings on radio. The fight was continually suppressed by the powerful broadcast industry, which was in no mood to pay artists for the sound recordings that formed the basis of their business.
Let's start with the basics. Every piece of recorded music contains two copyrights: the musical work (words and music), which is created by the songwriter, and the sound recording — the recorded performance created by the artist. In the U.S., on over-the-air “terrestrial” radio, the musical work enjoys a performance right paid by the broadcaster; the sound recording doesn't. For example, when “Respect” is played on terrestrial radio, the songwriter (Otis Redding Jr.) is compensated, while singer Aretha Franklin is not. Redding (and his estate) should receive a significant royalty from radio for creating this classic, but so should Franklin, who brought the song to life and created the second copyright. There's room in terrestrial radio's profitable $20 billion annual revenue to pay both. Broadcasters claim, “This is the way it's always been; there's no point in changing now.” This brings us back to the question of “Why now?”
The United States is one of few countries that lacks this basic intellectual-property protection. In other developed countries, terrestrial radio broadcasters compensate performers and recording owners when they play their music. In fact, in the past decade, the United States has become the only member of the Organization of Economic Cooperation and Development without the performance right. Further justification for action is payment from other platforms. Satellite radio, Internet radio and music delivered over cable all compensate songwriters and artists with royalties. It is hard for terrestrial broadcasters to claim that they cannot afford to pay artists when their newer (and less-capitalized) competitors pay. And with this new right, producers are finally getting paid for the performance of the sound recordings.
Finally, sound recordings remain the only performable copyrighted work in our copyright law that is not protected with a performance right. Literary works, choreography, audio/visual works all are protected with a performance right. Sound recordings are the only ones not protected.
So with these three inexplicable anomalies (the United States is the only country; terrestrial the only platform; and sound recordings the only copyright where the performance right is unprotected), radio's quest for business as usual can no longer be justified.
What about promotion? Radio's other argument is that airplay promotes record sales. Well, studies show in many formats that radio actually serves as a substitution for purchasing music. Regardless, promotion should never replace compensation. If a book is turned into a movie, then it promotes the sale of that book, but the author still gets paid for the movie rights. Whether promotional or substitutional, creators should always be paid for the use of their work.
This year, a group of organizations, including The Recording Academy, has come together to address this longstanding inequity that costs artists and producers hundreds of millions of dollars. The musicFIRST Coalition asks only for what is fundamentally fair and what will bring us in step with the rest of the world. We're asking for “Fairness in Radio Starting Today,” and we're hoping you'll look seriously at this issue and add your voice to this movement to help music creators. It's good for artists, it's good for music producers, it's good for consumers and it's good for the music industry. To find out more about this initiative, please visit www.musicfirstcoalition.org. To find out more about the Producers & Engineers Wing, please visit www.producersandengineers.com.
Daryl Friedman is the Recording Academy's VP of advocacy and government relations.