Italy's record labels have decided to present a united front in the current showdown with the 10 national radio networks that stopped broadcasting new records two weeks ago.
This morning (May 24) in Milan, all four CEOs of the country's major labels joined other industry representatives at a joint press conference in which they accused the radio stations of "blackmail."
Enzo Mazza, president of their representative body FIMI, was there along with Mario Limongelli, his opposite number at indie representative group PMI, Filippo Sugar, president of the country's leading indie, Sugarmusic, and Saverio Lupica, president of broadcast and performing rights collecting society, SCF.
The 10 private networks, which are presented by RNA (National Radio Associates), stopped playing new music sent by labels at 11.03 a.m. on Friday, May 7. This arose from a contractual dispute over royalties owed to SCF, which divides its broadcast and performance revenue on a 50:50 basis between labels and artists (who are represented by IMAIE, an organization which was officially "liquidated" last year and which is currently inactive).
SCF president Saverio Lupica says, "Our contract with these stations, under which they pay a modest 1% of their revenue for the use of music, expired in 2006. In Europe the percentages paid by radio stations range from 2% in Spain to 5.16% in Germany.
"In our negotiations, we tried to increase that figure to 2%, which is what is
recognized by Italian law, but the stations didn't want to know and so we reluctantly resorted to legal action. The stations then asked labels to sign a waiver in which they agreed not to ask for rights payments on new pieces that were sent to them. When the labels refused, the stations imposed their embargo."
FIMI president Enzo Mazza describes the complaints of the radio networks as "absurd - they spend more on their electricity bills than they do on music."
Yet the radio stations similarly accuse the record labels of "blackmail." Lorenzo Suraci, president of the Milan-based national network RTL 102.5, says that "the record labels, particularly the multi-nationals, are going after us to get more money because they are no longer selling records."
When asked how long the embargo would continue, he said: "We are prepared to carry on doing this until the case is resolved in court."
SCF took a number of networks to court in December 2008 over the contractual dispute, and the first hearing took place a year later. A court ruling is expected in March 2011.