Music industry group responds to performance-royalty protest with overblown threat

by Eric Ruth, Wilmington News Journal

RTM note: RTM supports the idea of a broadcast performance royalty. With appropriate fee caps for noncommercial broadcasters, it will provide an important revenue stream for performers, and bring US policy in line with international standards. The below-described response from the industry group MusicFirst, however, is indicative of the reason why so many music fans view the entire music industry with mistrust or contempt.

As radio stations go, Mount Pleasant High School's WMPH (Wilmington, Delaware) is full of earnest endeavor, but hardly noticed on a radio dial crowded by its more powerful neighbors.

Not anymore.

This 100-watt flicker of a station has attracted the wrath of the global recording industry for having the temerity to boycott certain performers in response to legislation that would allow record companies to begin charging stations a royalty fee.

Never mind that the monthlong boycott was two years ago, and that on good days WMPH's signal peters out just past Newark. Last week, a recording industry group called the MusicFirst Coalition asked the Federal Communications Commission to investigate and "take action against radio stations for abusing their license to use the airwaves."

MusicFirst singled out the Mount Pleasant station and two other stations -- in Florida and Texas -- in its filing with the FCC, charging that moves like WMPH's are an unfair attempt to intimidate artists into reversing their support for musician fees.

Among other harm inflicted or threatened, the Florida radio station left one artist's recordings off its playlist and the "Delaware radio station boycotted all artists affiliated with MusicFirst for an entire month," MusicFirst Executive Director Jennifer Bendall said in a release that accompanied the FCC filing.

"These are the cases we know about," Bendall said. "We can only imagine what may be happening under the cover of silence."

WMPH's ongoing stand against the Performance Rights Act is prominently detailed on its Web site. General manager Clint Dantinne, who endured an angry tirade from the MusicFirst folks while the boycott was under way, said his students aren't intimidated by the threats.

Their reaction to the royalty fee legislation, which is now wending its way through Congress, was another story.

"The students were outraged," he said. "They get really fired up about an injustice."

For WMPH and other radio stations in Delaware, the issue is also seen as the betrayal of a longtime partner in the music business -- and a potential threat to their survival. For 50 years, record companies allowed stations to play songs free of charge, giving the radio industry a product, allowing new acts to gain popularity, and bringing listeners a dynamic musical culture.

Then came downloading, MP3 players and the global recession, an evolutionary storm that threw recording industry profits into the compact disc remainder bin. If the global recording industry's attempt to boost profits succeeds, radio station managers say, they will be forced to take action, whether that means changing to a talk format or something more aggressive.

Paying the fee is not an option, said Pete Booker, president and CEO of Delmarva Broadcasting, which owns and operates eleven stations in Delaware and eastern Maryland.

"We couldn't do that," he said. "Economically, it would kill."

The filing by MusicFirst accuses the stations that staged boycotts of unlawfully putting those financial interests above their obligation to serve the public. Satellite radio, Internet radio and cable TV music channels already pay fees to performers and musicians, along with songwriter royalties. AM and FM radio stations pay songwriters only, not performers.

The songwriter royalties paid bt Delmarva Broadcasting amount to half a million dollars a year, Booker said.

"We're looking at the potential of six to 10 times that much, which is ridiculous," he said.

By cutting more deeply into station revenues, the recording industry would be killing the golden goose, radio managers contend. It would certainly mean fewer resources for hiring staffers that could serve community needs by gathering news and providing information, said Jane Bartsch, vice president and general manager of WJBR in Wilmington.

To the artists such as Bonnie Raitt, Natasha Bedingfield, and the Dave Matthews Band, the fees are simply long-overdue compensation. Radio stations counter that they have been compensating artists and record makers indirectly for years, through concert promotions and airtime. Booker estimates that in 2008, at the going rate for advertising airtime, his stations have provided artists with the equivalent of $46 million.

"We do a lot to promote the artist," said Mount Pleasant's Dantinne. "Not just play the song, but promote tour dates. We don't get paid for that."

Asking for 'a handout'

The Mount Pleasant station, which serves as a broadcasting classroom for students from Mount Pleasant, Brandywine and Concord high schools, celebrated its 40th anniversary this year. Students hit the airwaves after school, in the evening and during summer.

While the royalty legislation moves through the House, WMPH is urging listeners to petition Congress.

"The international record labels are asking Congress for a handout -- and they want to take it from your local radio stations," WMPH says on its Web site. The exact same phrase is posted on radio sites in New Jersey, Boston and by other members of the National Association of Broadcasters. "That may mean stations like WMPH would have to cut back on the music we play or the community services we provide."

The Performance Rights Act would serve to limit the variety of music listeners hear, stations contend. "My big bone of contention ... is if it wasn't for [W]JBR, the other stations around, they wouldn't know who Natasha Bedingfield is, who Linkin Park is," Bartsch said. "We actually break this music."

"From the days of Bill Haley and Elvis Presley and the Beatles, if radio stations never played their music, we would never know who they were," Booker said.

The House legislation, which is opposed by Delaware's sole representative, Republican Mike Castle, is coming at a particularly perilous economic time for stations.

"If this happens, first of all, it's going to put a strain between the radio stations and the record companies," said Tony Quartarone, owner and general manager of WJKS in Wilmington, who believes that some stations -- including his own -- will simply retaliate by charging the record companies an airtime fee.

"I'm gonna charge 'em right back," he said. "And it's legal. ... I'm gonna treat them the same way. So I'm not worried about it."

Such hardball tactics would take the dustup far beyond a short boycott by a tiny high school radio station.

"When you have a multibillion-dollar international industry worrying about what a high school radio station in Delaware is doing, to me that represents a really, really desperate position," he said. "I think it's really, really dredging deep."

article originally published at Wilmington News Journal.

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