Web Radio $$ for Pay-to-Play is a Last Minute Deal?

Webcaster Royalty Rates going to huddle

The news from this morning (posted earlier here) is already outdated, as it should be. Here's the latest in the attempt to keep web radio on the 'air' and live on the net.

MAJOR VICTORY??

Appeals court rejects Webcast royalty delay | Technology | Internet | Reuters

This was coming, one way or another. It looks like there's no reprieve, even though opponents say that the battle isn't over.

However, what strikes me is the attitude of the executive from SoundExchange:

"This is a major victory for recording artists and record labels whose hard work and creativity provides the music around which the Internet radio business is built," SoundExchange executive director John Simson said. "Notwithstanding this victory, we continue to reach out to the webcasting community to reach business solutions."

"Major Victory..." Shutting down thousands of online outlets for musicians, listeners, indie netcasters...this is termed a 'major victory'?

Perhaps he hasn't read the research or heard the anecdotal evidence that spreading music around by bits and pieces here and there actually leads to INCREASED sales...and that by closing down thousands of those bits and pieces, he's helping to shutter the doors on ways people get exposed to music.

There was a government study done years ago (I wish they'd do another!) that demonstrated unequivocally that sharing music by copying it and giving it to friends leads to MORE SALES.

Even in this digital age, if a fan finds a new artist, it's still highly likely that they'll eventually PURCHASE some of that artists music or attend a concert.

Closing down web stations that expose people to new artists (and face it, even the 'mainstream' artists are still new to people every single day) is closing down one avenue of music exposure.

I can't think that this is a 'major victory' for the recording artists and record labels, who continue to see CD sales decline.

Bring Back Payola?

It looks to me like the record industry isn't doing the math very well. They want to raise the rates that radio pays artists for the right to play songs.

See this here for more from the San Antonio Business Journal.

Let's turn this around. If radio stopped playing music - stopped COLD, and went to talk or news format (or playground sounds for that matter) - where would those artists be? Where would the record industry be?

They'd be squat out of luck. If there were no music played on the radio, nobody would know about new artists except through word-of-mouth, the grapevine, other media including online.

I think artists and the record industry would find out soon what advantage they have as the radio industry plays literally TONS of tunes - both old and new.

Now if this admittedly fantastic scenario unfolded, of course the music industry wouldn't die - and neither would the radio industry - but both would change drastically.

Theirs is a hand-in-glove relationship. One thrives because of the other.

If radio stopped playing music because it cost them too much (and yes there is a limit to how much they can take) they would change and evolve and find new programming. Listeners would make the adjustment by finding new tunes through friends, in-store listening, online recommendations and more.

And this statement puzzles me, because to me and my 25 years experience in radio, it rings false:

Said MusicFirst Executive Director Mark Kadesh in a statement: "Of all the ways we listen to music, corporate radio is the only medium that refuses to pay performers even a fraction of a penny for their voice and creativity."

What about the royalties paid to BMI, ASCAP and SESAC? Isn't that considered more than a fraction of a penny? And doesn't the radio industry scratch the back of the recording industry and its creative artist brethren in a ginormously beneficial way?

Of course it does.

So it may come down to see - if this movement progresses down the path it has started - who will blink first: the radio industry or the recording industry?

I dare ya...in fact, I double-dare ya, recording industry: take the plunge, get Congress to pass a law (scary thought #3,209 today) and see what it gets you.

See if the consumers of your product can find out about it without the benefit of radio.

Personally, I think we need to go back to the model that built the recording industry so big, but seems to have slipped in recent years: PAYOLA.