Nadler, who is the ranking member of the House Judiciary Sub-Committee on Courts, Intellectual Property and the Internet, said the bill was created to right a “great injustice." As it is now, the airplay system is “antiquated and broken,” allowing certain radio companies avoid paying any remuneration to rights holders.
The Free Radio Alliance issued a statement against the legislation, writing: "The performance tax legislation introduced by Rep. Jerrold Nadler is mostly a patchwork of past proposals, which have failed to pass Congress previously. It’s ironic that the only thing the music industry seems to be able to agree upon is taking more money from others, like radio stations, for themselves."
Because the U.S. doesn’t pay artists when their songs are played on the radio, they also do not receive compensation when their songs are played in other countries. The only other countries other than the U.S. which do not pay a master recordings royalty on terrestrial radio broadcasts are North Korea, Iran and China. “That’s a list that speaks for itself,” said recording artist Roseanne Cash, one of about a dozen artists adding their support for the bill. “Since we export more music than we import, our economy suffers,” Cash added.
Other artist-advocates included Martha Reeves, Duke Fakir of the Four Tops, Elvis Costello, Ronnie Spector, Cyndi Lauper, Martha Wash of The Weather Girls, Marshall Crenshaw, Gloria Gaynor, Nona Hendrix, Ray Parker Jr., Cassandra Wilson and Lenny Kaye of the Patti Smith Group.
Reeves noted her music gets played all over the world, and people assume the artists are rich because of that. “I don’t mind being an oldie-but-goodie,” said Reeves of The Vandellas, “but it would be good to get paid.” Reeves' former labelmate Fakir that in 1909, when the Copyright Law was passed, only songwriters received compensation -- because artists hadn’t yet begun recording music.
“When the car was invented, they paved the streets,” Fakir said. “But we artists are still stuck in the f---ing mud… I am here because I truly can’t help myself.”
While all radio forms pay songwriter performance royalties, only satellite and internet radio also pay master recording performance royalties to rights holders, thanks to the Digital Millennium Copyright Act of 1998. Some services like Sirius XM and Pandora interpret that requirement as to exclude recording from before 1972 recordings, the year master recordings received copyright protections under the law. Recordings made prior to 1972 are protected by state law, according to the music industry, and various elements of the industry are challenging Sirius and Pandora in court on this issue. (Sirius XM lost an important case related to this point late last year in California. That ruling's wider repercussions are still being worked out.)
Every previous legislative effort at the royalty been beaten back by the radio industry and its powerful lobby. The last time the industry attempted to secure a terrestrial royalty was in 2009, when the Performance Rights Act was introduced. The new bill has been written to pre-empt some rhetorical tactics used by the radio industry in the past to defeat new legislation. For one, stations that make less than $1 million in revenue will only have to pay $500 a year in performance royalties, while college radio stations will only have to pay $100. “Large corporations won’t be able to hide behind the claim” that this kind of royalty payment would put smaller radio stations and college radio stations out of business, Nadler said.
Previously, radio complained about the economy, asserting that they simply couldn’t afford to pay performers. But as far as the radio industry is concerned, “it's never the right time,” Nadler said. “What other industry says, ' We can’t afford to pay our workers; We want them to work for free,'” he cracked. “We got rid of that argument here in the U.S. in 1865," referencing the abolition of slavery legislated by the 13th Amendment.
SoundExchange president and CEO Michael Huppe noted to Billboard, “A lot of things [around] copyright law are pretty complex, but this bill addresses an issue that is as simple as it gets: that artists should get paid when their songs are broadcast.”