In March, the record industry sent some well-known musicians to dazzle Washington and rally support for a radio performance tax bill that was reintroduced. The so-called “Fair Play Fair Pay” Act would impose heavy royalty fees on local AM/FM radio stations to broadcast songs.
While supporters of Fair Play Fair Pay say it would help artists, a huge amount of the money from a new performance tax would go directly to big, foreign-owned record labels, and ironically, hurt artists’ greatest promotional tool. Radio is still the number one reach medium to share artists’ music with their fans. A performance tax would upend a mutually beneficial relationship between radio and artists that has thrived for nearly 100 years.
Radio Delivers Unique Value
Radio’s biggest differentiator is that it functions as a public service to local communities. Radio stations deliver local news, traffic, weather reports and emergency broadcasts. Many provide airtime for local charities. This is in addition to being a free entertainment medium available to anyone, anywhere.
Songwriters, lyricists and composers earn royalties when their songs are played on the radio – to the tune of $500 million each year. And radio provides nearly $2.4 billion annually in free promotion for artists, reaching 268 million listeners each week.
Local radio promotes and sponsors concerts in cities all across America. According to a recent Nielsen survey, most of the money Americans spend on music goes toward concert tickets.
Artists often acknowledge the irreplaceable role radio plays in their success.
At the Academy of Country Music Awards in Las Vegas in April, 30 radio stations sent in representatives to interview the stars. “Radio is the life blood of our industry,” Old Dominion’s Matthew Ramsey told The Tennessean as he did interviews with various stations. “It’s what keeps us alive as a band and as artists.”
If It’s Not Broken, Don’t Fix It
Supporters of a performance tax say that it won’t really affect radio stations. On the contrary, a performance tax could have a profound impact on the bottom lines of the local stations you value most. This could impact their ability to be active in the community, limiting the sponsorship of local events and charitable involvement.
A performance tax would burden local radio stations with crippling new fees, impacting jobs, hurting local organizations and channeling even more revenue out of your community to foreign-owned record labels.
Plenty of legislators from both sides of the aisle oppose a performance tax. The support for protecting radio is so strong that a bipartisan resolution opposing any new performance tax, called the Local Radio Freedom Act, has already gained 189 cosponsors in Congress. However, the resolution needs more cosponsors to keep local radio strong and pumping out the tunes you love.
Immeasurable Cost to Taking Radio for Granted
Local St. Louis radio station manager John Beck told the Free Radio Alliance the performance tax could put a lot of broadcasters out of business.
“It’s sad the record industry, the same organizations that beg us to play their music every day, have lost sight of how much of their success is due to radio airplay,” John said.
All this is why the only answer to the “Fair Play Fair Pay” Act is Foul Play No Way.