SHOULD RADIO STATIONS PAY MORE ROYALTIES?
Copyright and intellectual property laws have always been complicated in the United States. And they get even more complicated when you look at copyright as an international phenomenon. But overseas is where Mary LaFrance, a professor of intellectual property law at University of Nevada, Las Vegas, is asking the music industry to look — because doing so could unlock hundreds of millions of dollars in uncollected royalties for American artists.
LaFrance's suggestion is difficult to explain, and would be even more difficult to enact. Plus, it comes with a whopper of a catch. But it was inventive enough that her paper beat out dozens of public-policy suggestions to win LaFrance publication in Harvard Law School's Journal of Sports and Entertainment Law; she'll present it to music-biz insiders at the Rethink conference this week.
To vastly oversimplify: terrestrial radio and TV broadcasters in the United States have long been exempt from paying what's known as a PUBLIC-PERFORMANCE ROYALTY. In many jurisdictions overseas, that's not the case. Even though an American artist earns a performance royalty for being played on a European radio station, that money often never makes its way back to the artist. Why? The Europeans are withholding those royalties because their artists aren't making performance royalties when they're played on U.S. radio stations.
LaFrance points out that hundreds of millions of dollars would be available to American artists from European rights — if only the U.S. would stop exempting its radio stations from paying the full performance royalty. (Good luck with that: commercial radio stations should be really excited about paying a tax on every song they play.)
Although LaFrance clearly realizes that her idea would be a total fucking nightmare to implement, she's proposing it at an interesting time. Unlike terrestrial stations, internet radio stations are being forced to pay a public-performance royalty. And since the barriers between old-time radio and new-media radio are narrowing, more artists, managers, and online broadcasters are beginning to ask why terrestrial radio should retain its exemption.
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