Black radio owners worried about performance royalty bill

Chronic Magazine:

As we listen to our favorite tunes on the way home, a storm is brewing around the future of black radio. Here’s the skinny. ….

The hot-button issue of whether radio should pay performance royalties to artists for playing their music has split Michigan Democrat John Conyers from some of his long-time allies in the civil rights movement. Following in the footsteps of satellite, cable and Internet music services, the Performance Rights Act would result in AM and FM radio stations paying performers to play their songs.

The Rev. Al Sharpton and the Minority Media and Telecommunications Council, among others, have warned its impact would be "devastating" to minority stations, because they can't afford more expenses in these hard times.

David Honig, council executive director, says it would put "at least a third" of minority stations out of business. That sentiment became a reality just over a week ago after the U.S. House Judiciary Committee voted 21 to 9 to approve the Performance Rights Act. Just three days later, three black Philadelphia stations facing overwhelming song royalties were sold to catholic churches.

Meanwhile, the music industry has always wanted this legislation, and Conyers has been an advocate.

The fate of the bill in the full House is uncertain, but it seems to have its best ever chance to pass. It is expected that amendments will be added to make it more palatable to opponents, and Conyers offered one of the first when he proposed small stations (those stations with billing less than $1.25 million) pay only a $500 annual blanket royalty fee.

Up to this point, broadcasters have flatly rejected any compromise. But National Association of Broadcasters President David Rehr, a no-compromise hardliner has resigned.

"This is not a revolutionary concept," Conyers said of the proposed performer's fee for AM and FM stations. "Everybody gets paid for their creativity and their work."

However, Conyers and other committee members said their offices had been flooded by critics of the bill.

Conyers said he shares the concern about the potential impact of new fees on small broadcasters.

As a result, he proposed changes that were agreed to that create a sliding fee scale for small broadcasters and delays the start date of payments:

• Stations with annual gross revenues of less than $100,000 would pay $500 each year. Those with gross revenues between $100,000 and $500,000 would pay $2,500. Those between $500,000 and $1.25 million would pay a royalty fee of $5,000 per year.

In the original bill, stations with gross revenues of less than $1.25 million would pay a flat fee of $5,000.

Conyers believes the change to a sliding fee would affect 90 percent of all minority-owned radio stations, and 77 percent of all radio stations.

• The fees wouldn't start for three years if a station's revenues are less than $5 million annually, and for 1 year for others.

Talk radio stations playing only snippets of songs are exempt, as are broadcasts of religious services. Non-commercial stations, such as college stations, would pay $1,000.

Larger stations would work with performers to negotiate fees, which would then be approved by Copyright Royalty Board. A copyright arm of the Library of Congress, the royalty board would set rates when agreements can't be reached.

Conyers also asked for a Government Accountability Office study of the bill's potential impact on radio broadcasters, as well as performing artists and copyright holders.

Still Conyers' changes weren't enough to quiet concerns.

Critics argue that it's unfair to charge them a royalty fee when they can't charge performers a fee for the advertising they grant them that then turn into sales of CDs and concert tickets.

"Broadcasters bring value to the recording artist by airing their songs," said Karole White, president and CEO of the Michigan Association of Broadcasters.

"Many of our members have awards given to them by artists, by recording companies thanking them for making them the stars they are today. We are prohibited from charging anyone for the music that we play," she added.

Even more convincing, Radio One founder Cathy Hughes - who contends the bill threatens the survival of minority and women-owned stations during rocky economic times - has written an open letter pleading with her congressman John Conyers to think twice about a bill he is proposing that would require radio stations to pay for music from overseas.

Still one has to wonder if black radio would stand a better chance at survival if they actually provided a better quality product. Station owners and activists say it's a tax that they might not be able to afford, and that might put them out of business. However, listeners like myself have grown so tired of the empty, violent and misogynist lyrics that I have turned to satellite radio and my trusty iPod.

At the end of the day, it’s all one big cycle that must be figured out ASAP.

article originally published at Chronic Magazine.

The media's job is to interest the public in the public interest. -John Dewey