Music Artists Ask Congress to Finally Correct the Radio Royalties Mistake

Today is World Radio Day, and when most of us think of radio, we think of music. That’s why today, Congress received a letter signed by about 300 performing artists asking lawmakers to pass the long-overdue American Music Fairness Act (AMFA) this session. “Each year, AM/FM radio stations play nearly a billion songs. And each year, giant radio corporations rake in billions in advertising dollars while refusing to pay a single cent to the artists behind the music that attracts their advertisers in the first place and makes their entire business model possible,” the letter states.

The artists reiterate what presidents and legislators have known for generations—that it is absurd that the nation which produces some of the most popular recorded music in the world is almost the only democracy that does not pay artist royalties for AM/FM radio play. “This leaves the U.S. in the dubious company of North Korea, Cuba, and Iran,” the letter reminds Capitol Hill. And in a time of deep political divisions, lawmakers agree that this ongoing conflict between broadcasters and musical artists is unfounded and unfair.

As the letter reminds Congress, this is an international trade matter as much as it is a domestic issue of economics and fairness. Although most nations where American music is played on the radio do pay royalties, American artists receive nothing abroad solely because foreign artists receive nothing in the U.S. Plus, the core principle of AMFA is popular with voters. As the letter states, “…by a 6-1 margin Americans support Congress addressing this injustice….” That many Americans don’t agree on much these days, but Congress can feel confident that their constituents do support equity and fairness for American music artists.

AMFA’s Pedigree is Long – Too Long

Under copyright law, musical works, which are created by songwriters, are protected separately from sound recordings, which are created by performing artists who may or may not also be the songwriters. Broadcast, terrestrial radio networks have long paid royalties to songwriters for public performance of musical works but never to performing artists for airing the sound recordings.

AMFA, first introduced in June of 2021 by former Congressman Ted Deutch and co-sponsor Darrell Issa, is the legislative descendant of many bills over many decades proposing to remedy this inequity. During that time, artists have even earned royalties from digital transmission thanks to an amendment to the Copyright Act passed in 1995—sixteen years before Spotify became popular. So, to say the terrestrial radio fix is overdue is an understatement. I have advocated AMFA and explained its provisions in several posts, but I will copy and paste the basic terms again here:

For smaller stations (under $1.5 million/year), the AMFA caps royalties between $10/year to $500/year depending on revenue and status as either a public or private station. For larger stations and networks, rates would be set, as they for the rest of the performance licensing market, by the Copyright Royalty Board (CRB). Under the provisions of AMFA, the CRB must consider station size and revenue when setting rates and must also consider the station’s promotional value to recording artists.

The broadcasters have no plausible, factual argument to oppose the terms of AMFA; the basic principle of the bill is popular with Americans who love the music made by the signatories of this letter; and lawmakers already know all the reasons why passing this bill is the right thing to do. Time to get it done.

Photo source by Kjekol

Congress Should Only Pass AM Radio Act with the American Music Fairness Act

Two bills are back in motion in the U.S. Congress—the AM Radio in Every Vehicle Act, and the American Music Fairness Act (AMFA). As I argued in a post for The Hill last May, if the first bill is to become law, then the second bill should also become law. While the AM radio provision arguably has some public-serving benefits, it is unavoidably a favor to broadcasters—and to pass it without finally delivering long overdue justice for music artists would be unconscionable.

AM Radio in Every Vehicle

The AM Radio in Every Vehicle Act, mandating that all new vehicles include receivers for the AM band, was initially drafted in response to the auto industry signaling a move away from AM radio in new cars. For instance, in electric vehicles (EV), the powertrains interfere with AM radio reception, but even manufacturers of traditional powertrain vehicles were recognizing a downward trend in AM listeners and, therefore, planning to discontinue AM receivers in new sound systems. Thus, Senator Ed Markey (D-MA) and Representative Josh Gottheimer (D-NJ) sponsored the AM Radio in Every Vehicle bills, which gained bipartisan support, albeit along partisan lines.

Republicans emphasized the importance of conservative talk radio while Democrats highlighted the role of AM in the emergency broadcast system and its reach to underserved markets. Make of those rationales what you will (e.g., most people likely get their emergency messaging on their cellphones), but there is no question that AM in Every Vehicle would be a legislative favor to broadcasters, extending the life of terrestrial radio as the market moves toward alternatives like streaming and podcasts. Even if the market eventually abandons the AM band, the bill can serve as a precedent for FM radio, where more drivers listen to music. And that is significant because U.S. broadcasters still do not pay royalties to music artists for terrestrial radio play. That’s where AMFA comes in.

American Music Fairness Act (AMFA)

While the AM Radio bill was reintroduced this week by Rep. Frank Pallone, Jr. (D-NJ), Senators Marsha Blackburn (R-Tenn.), Alex Padilla (D-Calif.), Thom Tillis (R-N.C.), and Cory Booker (D-N.J.) reintroduced AMFA. “The United States is the only democratic country in the world in which artists are not paid for the use of their music on AM and FM radio,” said Senator Blackburn. “This legislation would close an outdated loophole that has allowed corporate broadcasters to take advantage of artists and their songs for decades.”

That’s it in a nutshell. And in a time when bipartisanship is in short supply, one would be hard-pressed to find a Member of Congress who does not agree that radio broadcasters should pay royalties to music artists for their vital contributions to the stations. The broadcasters will oppose AMFA, as they have always opposed royalty legislation, on the basis that 1) they cannot afford the royalties; and/or 2) their promotional value outweighs the royalty value. These claims are overstated, but even if they were not, the AMFA bill answers both. As describe in an older post:

As composers and artists have noted in many contexts, music is more regulated in terms of price than most other products on the market. While radio broadcasters are free to charge what the market will bear for advertising on their networks—and the largest entities earn billions in revenue—the music artists, with AMFA, are asking for a regulated price of more than zero for use of the only product that draws listeners to the stations in the first place. (Or do you listen to radio for the commercials?)

Further, not only should Congress condition passing AM Radio on passing AMFA, but it should set aside the political theater of a little-known resolution called the Local Radio Fairness Act (LRFA). Since at least 2008, this insincere (one might say cynical) never-to-be-passed resolution is akin to a loyalty pledge to the broadcasters, promising not to mandate royalties for musical artists. For instance, last year’s resolution highlighted the unfounded implication that radio play only benefits the artists rather than the honest assessment expressed in AMFA that the benefits are at least mutual if not generally tilted in favor of the broadcasters.

If Congress wants to mandate that AM radio remain in automobiles for the foreseeable future, so be it. But Members should also acknowledge that the law is a gift to the broadcasters and a precedent for a similar mandate for FM in the future. As such, it is only fair that Congress finally require American radio stations to pay artists for the music without which many radio stations would have little or no value whatsoever.

Photo by Ababil12

Senate Resolution asks Congress to Promise it will Keep Ignoring Musical Artists

A little-known Senate resolution called the Local Radio Freedom Act (LRFA) is a clever move by whoever thought of it. It has no force of law but instead asks Congress to sign a pledge to enshrine an unfair and unfounded policy whereby terrestrial radio broadcasters shall never pay royalties to musical artists. Why? Because that’s how it’s always been.

In copyright law, music generally entails two separately protectable works—the underlying composition and the sound recording. Sound recordings are created by performing artists, and many compositions are naturally recorded by different artists at different times. Quintessential examples include Whitney Houston’s “I Will Always Love You,” and Jeff Buckley’s “Hallelujah,” originally written and performed by Dolly Parton and Leonard Cohen respectively. But if you ever turned up the radio when one of these cover songs came on, you might not know that although Parton and Cohen received royalties, Houston and Buckley did not.

This omission in the royalty scheme has come before Congress many times over many decades, and most Members know the status quo doesn’t make sense. Public performances of musical sound recordings pay artists royalties in every other commercial context, and in every democratic nation in the world, except for American terrestrial broadcast radio. But what is music radio without music?

The answer from the National Association of Broadcasters (NAB), and which is parroted in the LRFA, is that radio “promotes music,” and it does. But that’s only half the story. The other half is that music draws listeners to radio networks, which sell billions of dollars in advertising. Members of Congress know this is the only equitable consideration, yet to watch the last hearing on the issue, one might get the idea that the IP Subcommittee is still at the investigative stage of the decades’ old problem. If Congress seeks an equitable arrangement, it’s in the text of the American Music Fairness Act (AMFA), which was introduced in 2021.

In addition to the half-true “promotion” argument, LRFA also echoes NAB talking points about the many free services radio stations provide to communities—from local news and emergency information to community outreach and charity. The implication is that these services would be curtailed or lost if they had to pay performer royalties, but this claim is neither supported nor well-reasoned. The stations’ good works continue while they pay talk show performers and news reporters—and no doubt, buy coffee and electricity, too.

Notably, when witness Eddie Harrell, Jr., representing the conglomerate Urban One, was asked at the hearing about the CRB, he did not seem to know what it is. This is not to mock Mr. Harrell, but instead to observe that if he was there to claim that his company cannot afford royalties but does not know about the rate-setting court, how does he know what he can’t afford? I think the answer is not that Mr. Harrell is careless or unable to do the homework, but that he anticipates not needing to present those numbers because the NAB has told him to expect that Congress will once again default to the tautological absurdity of “because that’s how it’s always been.”

Members of Congress know it is the large networks and conglomerates lobbying against AMFA and that they are not saying anything new in defense of the status quo. Because this issue has been on and off the table for about eighty years, any reference to further negotiation or study at this point is either a stall tactic or a pocket vote against AMFA. Meanwhile, signing onto LRFA is an explicit statement that, once again, the artists will be ignored right after their representatives tell them how much they are a treasured and respected part of the American tapestry.

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Tag: American Music Fairness Act