Terrestrial Radio Should Pay Royalties Too

The Hollywood Reporter had an article (hat tip to RAIN) that mentions how labels and artist groups are gearing up to lobby Congress for a performance right from terrestrial radio broadcasts.  When a piece of music is played (or "performed"), there are basically 2 rights that can be implicated - one for the underlying musical work or composition (ie the lyrics and notes that get played) and one for the actual performance.  For decades, terrestrial radio has paid royalties for the former to songwriters and composers but not the latter.  This has been unique to the US; whereas in most of the rest of the world, both groups have received a royalty for public performances. 

I've long advocated a level playing field when it comes to royalty rates and this is the most glaring example of the field not being level.  Performing artists should get compensated for their work regardless of the medium in which it is performed.  The argument of the promotional value of radio making up for the lack of a royalty doesn't hold water for me -- if it is indeed promotional, then the copyright holders should be willing to waive their royalty in exchange for greater airplay and promotion.   What this comes down to is what a fair rate is for the use of copyrighted works in building a business, and I just don't think it is the place of the government to make judgments on the value of promotion vis a vis the use of the copyrighted work.  Let the market decide. 

The Future of Music coalition has a great write-up of these issues here (obviously they are biased towards artists but I think their perspective is a fair one).  The record industry could sure use a revenue stream from terrestrial radio royalties -- if terrestrial radio is about a $20 Billion market in the US, a 5% royalty would be a much-needed extra billion dollars flowing to artists and labels.  They had better hustle in lobbying Congress though - there is a trend away from music being played on terrestrial radio and it will continue as new forms of distribution proliferate.