There’s a fire storm raging about the new performance “tax” that is being presented to Congress.
Now, I’m the first to bristle at new taxes, but I got a bad feeling in my stomach when it was the radio stations and NAB pushing to stop it in its tracks. Keep in mind that it was the broadcasters who formed BMI to limit performance royalties paid out to composers and songwriters... (competing with ASCAP) I kept hearing things like greedy record labels.. so I looked into it.
Seems that performers are not paid performance royalties in the US. Writers and publishers are, and have been since 1909 or some such year.. but for 80 years, performers are not paid.
NAB is arguing that it will cause less music to be played on the radio. Like there’s a lot now? Demand will dictate how much music is played on the radio, and having to pay another 1/2 royalty to the performer is not going to eliminate profit for the broadcasters.
Furthermore, as most are unaware, there are millions collected world wide for US artists on foreign stations, but because the US does not pay, those royalties are not distributed to US artists. That would open those funds up for artists as well.
Get on your horn. Let your congressman know that we want artists to be paid, just like publishers and writers are paid.
Remember, the Big labels.. well when their gone, its just us small labels and musicians left.. and how are we going to change the laws.
So, unless you’re not for artist getting paid for performing their works, you should be FOR this bill, not against it.
TIm
Friday, June 5, 2009
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17 comments:
I'm a computer programmer. I'd like congress also to pass a law saying that every time somebody runs a piece of code that I've had a hand in writing, the person running the program has to pay me an additional fee, so that I can get more money beyond the salary I initially agreed to get for my work.
That's the flaw in your logic here, as I see it. Musicians/performers are free to negotiate payment with whoever they're recording for. If they've got a problem with how much record labels are paying them, that's between them and the labels. Collecting additional money from the end-user, through the government and laws, sounds pretty stupid to me.
Thanks for the comment, Kingo. Debate is the key to common understanding.
As I see it, there's a flaw in your logic, as well.
As a computer programmer, you were paid to create the code you made. You are FREE to negotiate a work-for-hire arrangement, and some musicians do this with studio work. You get paid to do something, and the payer gets to do whatever he wants with your work.
The flaw in your logic lies in your artist paradigm and in who the "END USER" is. You assume that when there is an artist, there is a big label who paid them to produce music. An independent artist has no such entity. Also, when you say END USER, do you seem to equate listening to a CD at home with broadcasting a CD to gain a listening audience?
Broadcasters are paid by advertisers. Advertisers pay based on listening audience. In order for broadcasters to draw audiences, they must present compelling content.
They can do this in one of two ways. Option1: they can create content and accrue the costs that come with it, or Option 2: they can use other people's content to draw an audience.
If a broadcaster is going to use other people's content, there is an obvious value comparison between option 1 and option 2. Option 2 is worth something. At least what it would cost to produce option 1, and more if the content of #2 is more compelling than a self-produced news or comedy piece produced by the broadcaster.
The major labels are pushing for this, but as the economy of the music industry changes, the major labels will be less and less a player, leaving the field open for independent musicians to fend for themselves.
When that happens, don't you think an indie musician who invested their own money to produce their music should be compensated when their music is used to create ad revenues for some big conglomerate broadcaster?
The bigger point is this. The amount that is being asked for is miniscule.. maybe a 1/2 cent per play... Something a broadcaster can afford, but more importantly, at no cost to the listener.
Ask yourself this, where's the money behind this anti-performance "TAX" campaign? TAX? What tax? The consumer doesn't have to pay anything, and the broadcaster isn't paying the government. Even the use of the word TAX smacks of deceit. Its nowhere in the bill. The correct word is royalty, and royalties are paid when a creative work (even a software program) is used to create revenue for someone else. You might consider negotiating that the next time you write code for a one-time fee.
The broadcasters are trying to pull the wool over the consumer's eyes in order to gain their support on a bill that has nothing to do with us and will cost us nothing. Our support costs musicians their livelihood.
The broadcasters take us for fools. Its disgusting and immoral.
ok so let me see if i understand? local radio stations and broadcasters of big markets should pay this performance tax to small recording artists and labels because we dont want the small artists to have to fend for themselves?
I have to disagree that the broadcasters can afford this so easily. local radio stations will have major losses 1/2 cent per play per song is pretty ridiculous when added up. 19(with commercails and what not) hours per day 365. l days per year. local radio stations will have to cut things such as local news and sports in small towns because they cannot afford to pay the people who cover these areas.
is there any truth to what i am saying?
"local radio stations and broadcasters of big markets should pay this performance tax to small recording artists and labels because we dont want the small artists to have to fend for themselves?"
Once again, its not a tax. Its a royalty. An no, they shouldn't pay a royalty because the artists have to fend for themselves.
They should pay a royalty because what they are playing belongs to someone else and they are using it to attract listeners which in turn attracts advertisers, which in turn generates revenue to run the station.
If the songs they play don't generate revenue, or there's a more efficient way to generate revenue, they are free to use some other means of media or create their own.
If a song generates revenue, don't you think the performer of that song should receive some compensation for it's use?
Incidently, if a radio station plays 15 songs an hour, 168 hours a week, 4.3 weeks a month.. or 10,836 songs a month.. 1/2 cent each... the bill comes to $54.18 a month.
How much bad news do we have to give up for 55 bucks a month?
Do you know where that $54.18 a month will come from? It will come in the form of people like me, a board operator and show producer for 5 years heading to the unemployment line. That's the harm in this.
I understand completely where you are coming from, and I'm not exactly the NAB's best friend, but I have to be on their side here, because this not passing keeps people like me employed.
I work for a "mom and pop" radio station. We're a dying breed, and yes, thanks to this economy, if this tax passes, we're done for. 55 bucks a month is exactly half of what some of my co-workers make.
Sure, the Clear Channels, the Cumulus, the ABC radio's of the world can afford this with minimal job cuts. Maybe, it's time to look at other options, like ending deregulation of radio.
Thanks Matt.
I can appreciate trying to keep your job. I live in Detroit, and feel privileged to have a job. They're hard to come by these days.
Many Mom & Pop stations (under $1.25M/annual) will pay a flat fee that will result in even less per month, so I'm not sure that the $55 dollar amount is even worth discussing.
While I understand your feeling about the economy pressing in on you and on Radio stations, the reason things are getting tight is not because of the artists who created the material you're playing on your station.
Your employer is not the only victim of this economy. The industry is changing. What used to work doesn't necessarily work anymore. Just as your employer is having to re-examine the way they market their product and make a living for their employees, musicians are faced with similar challenges.
They are seeing their streams of revenue cut, as well. The "promotion" that radio stations used to provide artists does not significantly generate income for the artists any longer. Therefore, the 'arrangements' made in the past are no longer equitable. With the new music industry, the models that compensation was once based has completely changed.
$55 bucks. I recently had an increase in my benefit costs, and now have more than that taken out of my check each week for my health insurance. While it ticks me off, my income didn't go up to compensate for the amount. I had to adjust my standard of living to make up for that.
$54.18 per month, for a business, however, is a trivial amount. If it is not, then maybe you are right. Maybe it is a dying breed. Perhaps the answer is playing less music and turning to other sources for their programming.
In spite of your predicament at your job, the facts remain. Not paying the artists today based on how the market worked in the 40's is not trivial. It's wrong.
It's not a financial issue, its a moral issue. It's not about preserving your job or anyone else's. Its not about protecting the status quo of a business while the industry around it rapidly changes.
Its about doing what is right.
We need to stop exploiting the work of artists (or of anyone, for that matter) for profit and without compensation. It doesn't matter whether its done by a corporation, a small business, or an individual, or a "mom and pop". It's simply wrong.
Best of luck to you. I have a feeling we'll both be lucky to keep our jobs.
Tim says, "The amount that is being asked for is miniscule.. maybe a 1/2 cent per play... Something a broadcaster can afford, but more importantly, at no cost to the listener."
Knowing just a little bit about how the economy works, you can't seriously believe the listener will pay no cost for this tax. The consumer drives every portion of our economy, so when the "radio conglomerate" is charged more to produce the same product, they will pass that along to their revenue stream...advertisers. When the advertisers get a rate increase, who do you think will pay more at the supermarket, the shoe stores, etc. etc.?
The biggest problem with this proposal, though is that advertisers are likely to simply stop advertising on smaller stations, which means smaller (more local, minority or niche) stations will disappear. This means the consumer (listener) will pay again in the loss of these localized stations.
There is no "big guy who won't feel a small tax." Ultimately, I will pay for it...with this proposed system, I pay twice up front. Eventually, small radio people will lose their jobs, so I'll pay more taxes for their unemployment (third way I'll pay for this tax).
I'm sure I would pay in other ways if I think further about this. I understand as a small artist, you want to benefit by the use of your product for others' enrichment. The current system would necessitate you signing a deal with a label and negotiating that benefit. Until the Big Labels go 'way...that's the system.
"While I understand your feeling about the economy pressing in on you and on Radio stations, the reason things are getting tight is not because of the artists who created the material you're playing on your station.
Your employer is not the only victim of this economy. The industry is changing."
So, Matt...Tim is saying he is less concerned about your job than his royalties. Whereas I can understand that, you can't fault Matt for saying the same thing back atcha, Tim. He's saying he cares more about his job than your royalties, regardless of how small the reach is into the pockets of every radio station in America.
Thanks for the comment, G-Man.
I agree with you. Someone will pay. For sure, as they should. Perhaps it will be the advertisers. Perhaps it will be the consumer, either in the form of more expensive products, or having to listen to more commercials between programming.
The fact remains. The current losers are the performers of the music. Currently artist's performance are being used to generate audience's for free... zero compensation to the artists. Zero cost to the entities that benefit financially for the use of their music. Zero. The labels collectively have income from current artists. The radio stations have income from advertisers. Writers and publishers are paid for airplay. The artists are the only ones who get zero.
Artists a paid through resulting sales, and if a song is over a year or two old, the revenues generated as a result of airplay are negligible.
Stations will have a choice. They can develop alternative programming using news or talk or something else. They don't have to pay if they can generate income with other alternatives.
If the music isn't worth the money, they can use something else.
In reality, though, it is worth the money, and exploiting artist's work without compensation is wrong.
Tim
G-Man said: "So, Matt...Tim is saying he is less concerned about your job than his royalties. Whereas I can understand that, you can't fault Matt for saying the same thing back atcha, Tim."
For the record, I've never recorded or released any music for airplay. I'm already paid for airplay through writer royalties.
Injustice is injustice. Whether the messenger is an observer or the victim.
Tim
Being a musician that has performed and recorded for airplay this is a royalty that has been long over due. So many of the singer-songwriters out there make a killing on recording gold and platinum records while the musicians recorded on that album either get paid in a one time hourly wage for that recording or maybe some negotiated CD sales percentage. I'll tell you right now that the rehearsal time, individual practice time, actual recording time, dealing with songwriter/producer/ego nonsense, (and having come from a classical background) all the sacrifice to get to that point in one of the most competitive markets out there for work....this royalty is just a start.
Because performing musicians can/do/will get screwed, this assures them that they will at least get something. I'm struggling right now as it is and I have many tunes that I've played on right now being played on the radio. I see nothing from those plays and most of the time I have to practically beg to get paid for the studio work not to mention the rehearsal time. Most of the time I don't. I don't get to see anything from CD sales usually. Is this because I negotiated badly? No. It's because most of the musicians I play with can't afford to pay me what I need to get paid. If I want to get on the radio or have my talent noticed, I have to make sacrifices. It doesn't really seem like anyone gets that. The fees that I get paid for original and cover band gigs, teaching, and what have you have been almost the same for the last 10 years. The cost of living has gone up and the payments have stayed relatively the same. This doesn't even count the endless hours in a practice room. Anyone that says no to this royalty is in favor of musicians just like me (which there are more than you think) don't get to have compensation and the only people who are really important are singer/songwriters/composers, producers, and the labels/management that promote them. It's been a bigoted system for far too long. It's only the musicians that are lucky enough to be employed by record labels and that is not only not fair but oppressive to musicians that really deserve it but don't have the bank roll or luck to have lawyers, agents, and other representation. Besides, people already pay this already, this just happens to be on the radio front...it's called ticket sales, door cover, percentage of bar sales...this isn't new. This needs to be done.
By the way, Tim, no offense. I feel sure you're in favor of anyone you work with to get fairly compensated. I just haven't worked with that many. They are too few.
Hopefully this bill will not pass, but be replaced by a good bill that sets up a better standard on how royalties are charged. They should be assessed based on the profits of the companies and calculated like a sales tax. This would eliminate the threat to small stations will little or no actual profits derived from any form of broadcasting. This should be collected by a government agency (not BMI, ASCAP, or SEASAC), and the money should be distributed equally to the all the involved parties (performers, writers, copyright owners). There should also be a uniform method that uses modern technology to determine the exact airplay of artists (not just voluntary reports of play logs for a two week period in Feb. that are collected by BMI).
I look forward to your thoughts.
Nicklas
p.s. being caught between legislation written by the RIAA and CLEAR MONOPOLY, is like being caught between THE SCHOOL BULLY and THE GYM COACH WHO MOLESTS YOU.
Thanks for your comment, Nicklas.
I can't agree more about using technology to determine actual payouts. I'm not alone when I express doubt that the "surveys" they currently use miss many older songs that "statistically" don't get played anymore. There's no excuse. A play should pay.
In reality, this bill would help that change to take place. With performers added to the roster, the demand for more accurate accounting and play logs will grow, as there are more artists to help police the system and drive the system to do more accurate accounting.
As for the PRO's (ASCAP, BMI, SESAC), I can't help but think that one of the reasons the accounting is so poor is because one of the PRO's was formed by the Broadcasters. I'm not surprised the accounting is lax. Competition in the PRO's is not good for the writer.
It's unclear how the artist will be paid, as ASCAP and BMI, and SESAC are currently reps for publishers and writers. It may, in fact be a government organization that collects for the artists. However, it might make sense for the PRO's to register artists as they are already in the business of collecting. In either case, if the accuracy goes up, we all win.
I don't quite understand how a sales tax based on profits would work. Performance Royalties are royalties on performance and while there may be some sort of connection between airplay and sales, in reality, that relationship is eroding, because sales as a result of airplay is less and less likely with the new music economy.
In addition, what about indie artists without a label? How would they compete in such a sales-based system?
Thanks,
Tim
Thanks, Tim, for this dialogue. I'm a musician in Nashville, in the biz for 35 years.
This is one of the few places on the web where this issue is discussed honestly and without rancor.
Well done.
The radio station advocacy spots against this "tax" are disingenuous, xenophobic propaganda. I'm listening to it as I write: "bailout", "bankrupt", "tax", "foreign-owned".
The artist cannot buy an advocacy spot on any radio station that runs these lies.
Keep up the good work.....
Thanks Brad,
I have to admit that when I first heard about the performance 'tax' I was swayed against it by the arguments I heard. Greedy record companies.. rich musicians.. impoverished broadcasters who were victims of the poor economy.
Then it occurred to me that I couldn't find the opposing point of view.. anywhere!
That was my first red flag.
On the airwaves, the musician can sing and play (for free), but you won't hear him arguing his case for royalties.
Tim
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