RIAA Seeking Royalties From Radio

The RIAA continues it's efforts to recoup monies lost on album sales due to online pirating. This time they're going after the broadcast radio stations themselves in an attempt to upend a 70-year exemption agreement.

For a number of years radio stations have paid royalties only to composers and music publishers when they play their songs. The stations have enjoyed a federal exempt status in the past from paying record labels because they claim that playing the songs on the radio actually increases album sales and label profits and until now, the labels agreed. But with CD sales plummeting the RIAA is going to Congress in an attempt to take away that exempt status, a move that would mean hundreds of millions of dollars in new revenue for record labels every year.

"The creation of music is suffering because of declining sales," said RIAA Chief Executive Mitch Bainwol. "We clearly have a more difficult time tolerating gaps in revenues that should be there."

Broadcasters are preparing for the fight and expect it to last more than a year. The 70-year exemption being taken away would be a major blow to the radio station's profitability and they won't go down without a fight, claiming that radio stations should never be forced to "pay to play" music.

"The existing system actually provides the epitome of fairness for all parties: free music for free promotion," wrote NAB President David Rehr.

Maybe it is time that this exemption was lifted. The industry has completely changed and new methods of airplay like podcasts and digital radio stations make it harder and harder to figure out what is right. The exemption laws were created before all of these types of places even existed.

"Given the many different ways to promote music now that didn't exist as effectively when this original exemption was made," he said, "the logic of that I think is more dubious."

This just goes to show how desperate the music industry is getting to recover from losses due to new technologies like mp3s, cd burners and ipods. The industry continues to find ways to sue it's way back to profitability and has yet to come up with some good ideas on how to adapt to the new technology age. Most involved in the industry say it's about time record labels got a slap in the face and blame them for unfairly taking the major windfall of money generated by the artists they represent. The industry of course claims that the actual "creation of music" is now suffering due to declining sales.