RIAA Wants Public Radio to Pay Royalties

The air waves may no longer be free

Recent studies show that sales of music have actually increased over the last several years despite arguments from the Recording Industry Association of America (RIAA) that online MP3 sharing negatively impact sales. Thus, the RIAA has been desperately trying to seek out a new source of revenue and it believes its found one: public radio.

The RIAA says that radio has been given free play time for too many years, and when compared to other sources of revenue, is unfair. Yet, it's not only the RIAA that thinks the new royalty program is justified. Mary Wilson, one of the original members of the Supremes agrees too.

"After so many years of not being compensated, it would be nice to now at this late date to at least start. They've gotten 50-some years of free play. Now maybe it's time to pay up," says Wilson. According to Wilson, the exemption given to public radio was unfair and forced many musicans to continually go on tour for money.

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.

The National Association of Broadcasters (NAB) disagrees with the RIAA, claiming that public radio benefits all parties. "The existing system actually provides the epitome of fairness for all parties: free music for free promotion," says NAB president David Rehr. Public radio stations agree too, that having a royalty "tax" would cause serious financial harm to radio stations.

Unfortunately for public radio, the music industry appears to be lobbying its stance in a very strong manner. SoundExchange, the group that collects and distributes Internet and satellite radio music royalties, feels that royalties have now become a necessity. SoundExchange already forces webcasters to pay royalties for music played.

"The time comes that we really have to do this," says John Simson, executive director for SoundExchange.

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