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I had heard about this, but hadn’t researched it until Luis brought it up. It seems my good friends at the RIAA are at it again, trying to find even more ways to suck money out of every corner of the suffering music industry.
Over the years, radio has been allowed to skip out of paying “public performance royalties“. While they paid the most basic royalties, they did not pay for playing them in a public forum such as over-the-air radio. So, now, the RIAA feels it is time for this to end, and that radio needs to pony up millions of dollars a year in these other royalties. This has been attempted before according to this story in the LA Times (be warned, they archive fast):
Broadcasters even successfully fought a group of singers and musicians led by Frank Sinatra in the late 1980s who tried to pressure Congress into changing the law. Broadcasters also prevailed in 1995, when Congress exempted them from new fees for digital recordings that everyone else had to pay.
There are two main reasons this is a dumb idea:
1. Where do the majority of people hear music for the first time, that, in turn, inspires them to go purchase an album? On the radio, of course. So, now say the stations have to pay higher royalties, you will have more stations out of business (see #2), more royalty free music played/less music played, and the free advertising will dry up, causing lower album sales.
2. Terrestrial radio is already in the dumps, by forcing them to pay out even more money, you will see even more stations drying up and you will soon be left with nothing but the big conglomerate run stations. The problem with this is they are run from a centralized station, so no more local news, weather, and personal touch.
This is a HORRIBLE idea, and, once again, shows the unbelievable greed of the music industry. They are literally biting the hand that feeds them, and they will then whine when record sales drop even more due to fewer people knowing of new music. And demonstrating just how out of touch the RIAA is with reality:
RIAA chief executive Mitch Bainwol indicates that music creation is suffering a decline in sales, attributing most the loss to gaps in revenue. “We clearly have a more difficult time tolerating gaps in revenues that should be there,” says Bainwol.
Really? This small lack of royalties, something you have done without for all these years, is the reason for the lack of creation? So, all those new albums out there, the vast majority of which suck, there would be even more suckage out there because these royalties would help more music get created?
This… I hesitate to use the word… “logic” is just totally beyond me.
– Music is created
– Music is played on radio in royalty free state
– Person hears music, buys crappy album for one song
– Music industry makes money
– Even more new music is created
– Less radio stations to play due to paying too much being paid in royalties
– Fewer people her music, buy crappy album for one song
– Music industry makes less money, but make up for it in royalties?
Am I missing something in all this?