OPINION:
For years, the big record labels have pushed Congress to impose a new tax on the songs performed on local radio stations. The record labels have been hit financially by the disruption caused by the Internet, and they continue to lobby Congress to require local radio stations to bail them out.
To date, Congress has shown no appetite to give into the pandering of the big label conglomerates. However, that has not stopped the music bigwigs, including inexplicably the music publishers. During an event at New York University’s Steinhardt School, they recently pressed Judiciary Committee Chairman Jerry Nadler, New York Democrat, to push this divisive issue through Congress.
There, Mr. Nadler stated that, in the post-Music Modernization Act world, there is still unfinished business to take care of with music licensing. In particular, he singled out the need to implement a performance royalty for AM/FM radio airplay as the next step forward. The trouble is that for years, most of his colleagues in Congress have disagreed, claiming that such a new fee structure would be devastating to the music industry at large.
For the past several Congresses, the House of Representatives has routinely issued a resolution opposing such a radio royalty. In fact, in recent years, a strong bipartisan majority of the House has opposed a new royalty on radio.
The Senate concurs with the House’s opinion on this matter. Years ago, it issued a report stating that Congress “should do nothing to change or jeopardize the mutually beneficial economic relationship between the recording and traditional broadcasting industries.” It made this statement under the belief that imposing a fee on the free airplay radio stations provide to the recording industry would be unfair to stations and performers alike.
It is quite ironic that the music industry fat cats are pushing for this new tax when they already profit greatly from radio’s free promotional exposure. Without radio airplay, they would have little means of free mass promotion, which would harm their artists’ ability to maximize their earning potential. Additionally, with this added cost, radio would have no choice but to resort to playing established artists almost exclusively. As a result, all-too-many up-and-comers would lose their shot at making it within the industry.
Congress has understood the counterproductivity of such a proposal for decades. Which raises the question: Why would Mr. Nadler or any other member of Congress try to break up this vast realm of agreement and turn it into yet another political battleground?
Based on his statements made at the Steinhardt event, Mr. Nadler seems to be under the illusion that the radio industry, rather than the music industry brass, is the crony interest in this fight. When considering who hosted Mr. Nadler for the event, it becomes more understandable why he would think so. After all, the Steinhardt School at NYU has become an advocacy platform for music industry interests.
The program’s leadership team has a history of working for the “have your cake and eat it too” interests. Larry Miller, the director of Steinhardt, served as a paid witness for the music publishers just three years ago. Given his allegiances, it’s no wonder why Mr. Miller routinely derides the radio industry to the press, as he did in a CNBC article this summer, which I refuted. There is clearly an anti-radio bias within NYU’s music school, and policymakers should not take the bait — at least not without the proverbial “grain of salt.”
By all accounts, the Music Modernization Act reformed vast swaths of the once-antiquated music licensing industry. Its alterations included updating music royalty rules with the streaming age and ensuring that songs dated before 1972 receive copyright treatment for the first time.
Without question, Congress had artists’ interest at heart when crafting this bill. But the reason members chose not to include a radio performance royalty was done with performers’ well-being in mind as well. Congress knew that such a change would only serve to benefit the well-to-do at the expense of everyone else.
Rather than continuing to spout the music elite’s talking points while taking direction from academics that seemingly have much more than an intellectual interest in the industry, Congress should focus its attention on reforms that can achieve agreement.
Congress is already divided like never before, and it’s high time for everyone to sing from the same song sheet.
• Andrew Langer, president of the Institute for Liberty, is the host of “The Andrew Langer Show” on WBAL NewsRadio 1090 in Baltimore.
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