Internet Radio Fairness Act is nothing of the sort says the music industry in a rising chorus of opposition
On November 28, a hearing titled “Music Licensing Part One: Legislation in the 112th Congress” was held on Capitol Hill in Washington, D.C. hosted by the House Committee on the Judiciary – Subcommittee on Intellectual Property, Competition and the Internet and focusing on the controversial Internet Radio Fairness Act. The Bill, which is supported by Internet radio provider Pandora and others like it, has brought a loud cry of opposition from across the music spectrum.
The National Music Publishers’ Association (NMPA) was on hand to host a songwriter showcase which, among others, featured Nashville Songwriters Association International (NSAI) President and hit songwriter Lee Thomas Miller,who later told Music Row magazine: “The bill at hand deals with payment to the record companies, but [Pandora and other Internet radio services] have also sued the P.R.O.s to lower the rates paid to songwriters and publishers. We were here to arm lawmakers with information about songwriters before the hearing. You can argue all you want about how to split up this pie, but remember we [songwriters] created 100 percent of this product. There was nothing and we made it up out of thin air. Everybody else is trafficking in goods that we made. As you devalue the product, jobs go away in an already fragile industry. It’s ludicrous to go into the digital world with an assault to further devalue what is already being unfairly compensated.”
A letter opposing the Bill from organizations like ASCAP, BMI, SESAC and NSAI addressed the “gross inequities” that have developed in the amounts paid to songwriters, composers and publishers versus those paid to record labels and recording artists. The letter observed: “Pandora’s 2012 annual report stated that it paid 49.7% of its revenues in royalties to SoundExchange, and 4.1% of its revenues in royalties to the U.S. PROs, namely ASCAP, SESAC and BMI. In other words, from the total pool of monies paid for the performance of music and sound recordings, almost 92% of the money paid by Internet radio flows to record labels and performing artists through SoundExchange, and only 8% of it is paid to songwriters and publishers.”
A missive from the Recording Academy posted at Grammy.org says: “Pandora is asking Congress to pass the deceptively entitled the ‘Internet Radio Fairness Act.’ The bill will take money away from music creators and give it to Wall Street shareholders. The bill would allow Pandora to pay royalties that are below the fair market rate, increasing its profits while reducing payments to the music creators that are the backbone of its business. Pandora is worth an estimated $1.8 billion and is expected to make over $600 million next year. It can afford to compensate hard-working artists and music professionals by paying fair market royalty rates.”
More than 125 artists, from Bryan Adams to the Zac Brown Band, recently signed an open letter headlined “A Musicians’ Perspective on Pandora” opposing the Internet Radio Fairness Act.