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MusicFirst Lobbies Against Easing Ownership Caps

RIAA and its allies tell the FCC that NAB's arguments are self-contradicting

The musicFirst Coalition says the National Association of Broadcasters is singing one tune about performance royalties but an entirely different one about media ownership.

The coalition wants Congress to eliminate the longstanding exemption from artist compensation that U.S. radio stations enjoy. While the FCC isn’t the body that would establish a royalty, musicFirst knows that the FCC is conducting its quadrennial review of ownership rules.

MusicFirst includes the Recording Industry Association of America (RIAA), SoundExchange and SAG-AFTRA, as well as other advocacy groups.

It wrote Thursday to ask the commission not to relax broadcast radio ownership rules. It said the FCC should disregard NAB’s arguments that radio broadcasters’ loss of audience share and online platforms’ refusal to provide adequate compensation justify an easing on ownership.

NAB and recording advocacy groups have been at odds for years over a performance royalty. But it is a live issue right now on Capitol Hill, with lawmakers considering the American Music Fairness Act in committee, and with radio stations running spots in opposition to it.

“Making millions of advertising dollars off the backs of recording artists without compensating them is a shameful, longtime practice that was never appropriate,” musicFirst wrote.

It accused the NAB of hypocrisy for arguing that because technological changes have revolutionized media, broadcast radio ownership rules must be overhauled so stations can earn fair compensation for their content, especially in light of COVID-19.

“Recording artists operate in the same, radically changed marketplace as radio broadcasters. Those changes, as well as the shuttering of live venues during the pandemic, similarly increase the need to revisit the lack of a broadcast radio performance right in sound recordings,” the coalition told the FCC.

The commission “should take notice that the NAB’s arguments in support of relaxing the broadcast radio ownership rules and passing the Journalism Competition and Preservation Act on the one hand, and its arguments against the American Music Fairness Act on the other, cannot simultaneously be true. The FCC should not entertain the NAB’s contemporaneously contradictory positions before federal policymakers, especially when those positions are being used to support policy changes that will affect the public interests in media competition, localism and diversity.”

The coalition also continues to reject NAB’s claims that airplay has promotional value that eliminates the need for radio broadcasters to pay recording artists. “Such a rationale could swallow all of copyright, as any use of content can be called ‘promotional.’ But even the NAB’s own arguments before the FCC are showing the flaws with its promotion claim.”

An NAB spokesperson declined comment for this story.

[Read the letter (PDF).]

[Related: LeGeyt Dismisses Proposed Royalty “Starter Fee”]