Music firms demand an end to free airplay in America

[news=http://img241.imageshack.us/img241/1654/ifpi1ky.gif]MUSIC companies are lobbying US legislators to force radio stations in America to begin paying for the music they play over the airwaves, The Times has learnt. The companies believe that they would earn an extra $500 million (£281 million) a year.

The global music industry body, IFPI, criticises laws that do not require US radio stations to make payments for the music they broadcast — known as performance rights fees — as “a major shortcoming” and “contrary to international standards”.

The organisation, through its US affiliate, the Recording Industry Association of America (RIAA), has started to lobby lawmakers in Washington to change the rules to force broadcasters to pay for music.

*
Lauri Rechardt, director of licensing and litigation at IFPI, said: “We need to convince the political establishment that our cause is just. It needs to be put into legislation, as has been done in all other countries. It’s been raised by the RIAA and the artists representatives.”

Mr Rechardt said that a change in the law was “only a matter of time”. “From our point of view the timing must be as soon as possible. I’m convinced it will happen,” he added.

Britain is the largest market for the payment of performance rights, which requires companies to pay whenever music is broadcast on radio or television or performed for commercial purposes. Record companies received $93.5 million for performances rights in the UK last year, compared with only $9.1 million in America.

But the US is the world’s largest radio market, with dozens of networks and hundreds of stations generating revenue worth billions of dollars every year for conglomerates such as Clear Channel Entertainment, Cox Radio, Viacom’s Infinity, and Emmis Communications serving a population of 295 million people.

“The US is so huge [that] we would double the value of the global market,” Mr Rechardt said. “I estimate, conservatively, that the US radio market is worth half a billion dollars in performance rights.”

Performance rights collected last year reached $493 million, up 4.5 per cent from 2003 and an increase of 19 per cent over the past five years. The figure includes licensing income from webcasting and simulcasting as well as radio and TV and public performances in bars, hotels, clubs and restaurants.

IFPI believes that total radio payments to record companies and artists are “much lower than the fair market value of recorded music to these stations”. Europe accounted for $358 million, almost 16 times the contribution from North America.

:source: Source: timesonline[/news]

Is their no end to their greed? The radio stations should refuse.

No kidding. If big broadcasters like Clearchannel refuse, they'll have to back down. Those are the people they hope to bank off of anyway, not the smaller stations. The smaller ones would probably have to sell out. It's a catch 22 though, both sides need each other to survive.