BY DANIEL MCSWAIN
Members of the House Judiciary Committee will convene Tuesday to hear testimony on behalf of the radio and recording industries, two groups at odds over the contentious issue of a new performance royalty for broadcast radio.

The "Hearing on Ensuring Artists Fair Compensation: Updating the Performance Right and Platform Parity for the 21st Century" marks the first time this particular performance royalty issue will be discussed in an official hearing in Washington D.C.

The meeting will take place in front of the Committee for the Courts, the Internet, and Intellectual Property, the subcommittee led by Reps. Howard Berman (D-CA) [pictured right] and Howard Coble (R-NC), Chairman and Ranking Member, respectively.

Since June, recording industry groups, as members of the musicFIRST coalition, have lobbied lawmakers and released public statements calling for the creation of a broadcast performance royalty.

Efforts to create such a royalty have been vigorously countered by the NAB. In May, NAB president David Rehr sent a letter to members of Congress urging them to "oppose the imposition of a new performance tax" that could resemble the performance royalty currently paid by digital music transmissions like Internet radio.

In the same letter, Rehr noted that "radio has prospered with the use of recorded music, and record labels and performers have benefited from airplay and other promotional activities of local broadcasters. From this free airplay, the recording industry enjoys increased popularity, visibility and record sales." [previous RAIN coverage here]

A statement on the musicFIRST website claims that, "For 80 years, Corporate Radio has refused to compensate artists when they play their songs on the radio, even though radio makes billions an ads from listeners and music fans."

Representatives from the recording and radio industries are expected to testify at the hearing, including singer Judy Collins and Stax recording artist Sam Moore. RAIN will provide additional coverage and analysis of the hearing later in the week.

From Harp Magazine: "Last month a group of recording artists and organizations calling itself the Music First Coalition joined forces in order to seek  royalties for their music when it gets played the radio. Their mission statement, according to the Music First Coalition website, is to 'level the playing field and promote fairness among all types of radio,' adding, 'Corporate Radio has had a free pass for too long.'

"The movers and shakers behind the Coalition are several key recording industry groups (including the RIAA, Soundexchange, the American Federation of Musicians and the Christian Music Trade Association)...

"[T]o date, broadcasters’ organizations such as the NAB have successfully argued that without radio airplay, artists wouldn’t be able to sell nearly as many records as they do—that airplay and music sales are positively linked...

"[W]ho exactly has been getting the so-called 'free pass' that the Coalition mentions?...[R]adio has exerted a huge influence upon record sales. You might even say that radio has been and continues to be a highly effective—and, if you ignore issues of payola, completely free—promotional tool for the music biz!...

"Once again, forces in the recording business are trying to build a bogeyman to blame for the industry-wide decline of music sales...

"If one adopts the argument that the 'overall effect' of radio airplay is to 'depress the market for albums,' then why on earth would you want to devote your energies to collecting money from broadcasters? Why not just stop doing business with them altogether (sending them CDs, having on-air promotions, buying ads, etc.) since they’re negatively impacting your bottom line?...

"Ah, but since the correct response here appears to be to actively try to discourage radio stations from spinning your records..., then by taking the hard line and putting in the financial squeeze—re: the royalty grab—you’ll eventually alienate broadcasters to the point that they’ll want nothing to do with you or your product, right? And as soon as 'Corporate Radio' stops playing your artists’ music, you’ll stop seeing a decline in your artists’ record sales, right?"

Read the entire story at Harp Magazine online.

From Mark Cuban's Blog Maverick: "It was 9 years ago we went public with what was then the biggest first day jump in stock price in IPO history...

"If you didn't know Broadcast.com, or don't remember it, we were serving audio and video live and on demand to more than 1mm unique users per day in 1999. I don't even remember how many audio and video files we served per day, without 100mb or 10min limits, encoded up to 700k.

"We had full length audio books, full length CDs, full length movies, TV shows. You name it. And unlike today, we actually got licenses for them before they were on our site. We had preroll commercials. We had inserted commercials. We even inserted video commercials into audio files and streams.

"And user generated content ? Yep. Mostly corporate, since back then that's who could afford the tools to edit video...

"Just think if we had put up a discussion forum and called ourself a Social Network."

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