NAB Disputes RIAA International Grounds for Performance Fee

March 10, 2009

Washington, DC - Mar 9, 2009 - The National Association of Broadcasters (NAB) has released an analysis that challenges a fundamental argument in the Recording Industry Association of America's (RIAA) performance fee issue that seeks to lift the exemption of performance fees that terrestrial radio stations enjoy. The RIAA argues that terrestrial broadcasters around the world pay the fee, so U.S. broadcasters should, too.

According to the NAB, the RIAA effort is founded on an incomplete and therefore misleading comparison of U.S. and international copyright law. The NAB has released an analysis to refute the RIAA claim.

"The record labels have devised a lobbying strategy that relies on cherry-picking international examples that paint a distorted picture of copyright law," said NAB Executive Vice President Dennis Wharton. "The U.S. protects sound recordings for 45 years longer than Canada and many countries in Europe and elsewhere; if it's 'international parity' that RIAA is looking for, they ought to examine the entire landscape."

Three key items are touted in the NAB analysis.

  • Other countries provide less copyright protection for sound recordings.
    Under U.S. copyright law, a sound recording is generally protected for 95 years. Canada and many countries in Europe and Asia provide only 50 years of protection.

  • Other countries' broadcasting systems are or were government-subsidized.
    While the U.S. broadcasting business was built by private commercial entrepreneurs, broadcasting systems in many other countries were built and owned or subsidized by the government and by tax dollars. The 2005 report of the Digital Future Initiative Panel noted a wide disparity between the public funding for broadcasting in the U.S. versus other countries around the world:

    Annual Funding Per Capita
    United States$1.70
    United Kingdom$83.00

  • Cultural playlist quotas are imposed on broadcasters abroad.
    Diversity on the airwaves in the U.S. comes from the high quantity of stations and market-driven differences in programming, not from government-mandated quotas, as it does in other countries. In Canada, private radio stations must ensure that 35 percent of all popular music aired each week is Canadian. Similar provisions exist in numerous countries, including Mexico, France and Poland.

    The analysis notes that the existing U.S. model of free airplay for free promotion has served the recording and broadcast industries well for decades. Levying a new performance fee on local radio stations would "take this mutually beneficial system and transform it into an unfair, one-sided scheme that financially benefits only the recording industry -- to the detriment of local radio stations and their listeners."

    Last year, the NAB released a study showing that free airplay on local radio stations generated between $1.5 and $2.4 billion dollars in album sales for the recording industry.

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