Update on "Perform Act": Radio Execs Urge Delay on Music Vote

On July 7th, we posted an article: "FCC Meeting, July 13th, Deletion of Scheduled Item "Satellite Radio's Impact on Terrestrial" (Link to our post: HERE).
I think this went largely unnoticed, but today, in Billboard Monitor, we caught this:

Radio Execs Urge Delay In Music Vote
July 24, 2006By Brooks Boliek, The Hollywood Reporter

A dozen of the nation's most powerful radio industry CEOs are urging leaders of the Senate Judiciary Committee to postpone consideration of legislation that requires satellite, cable and Internet broadcasters to pay fair market value for digitally transmitting music.The leadership of the Senate Judiciary Committee has been considering a committee vote Thursday (July 27) on the bill known as the Perform Act. While committee aides said Friday (July 21) that a decision on exactly what would come up during Thursday's bill-writing session had yet to be decided, broadcast and record label executives said the committee's leadership was considering bringing the bill up.The legislation sponsored by Sens. Dianne Feinstein, D-Calif., and Lindsey Graham, R-S.C., and Senate Republican leader Sen. Bill Frist, R-Tenn., is being pushed by the RIAA, music publishers and musicians groups.Broadcasters oppose the legislation because they fear it will force them to have to pay for music transmitted digitally over the Internet. The bill also would force services like XM2go to pay an additional royalty to rights holders when customers digitally record music using those services.Broadcasters contend that moving the legislation would be "premature" given that there is little agreement between the industries affected by the legislation."After a number of meetings and discussions, the parties remain divided," the broadcasters wrote in a letter mailed Friday. "The lack off accord is largely due to the complex nature of the subject matter. Many within the various industries and congressional staff have questions that simply remain unanswered."While passage of the legislation is far from assured, given the short time left in an election-year Congress, a vote by the committee on the legislation would put more pressure on broadcasters to make a deal.Record industry executives say the broadcasters' are stonewalling the bill in an attempt to get Congress to do for them what the courts wouldn't. While broadcasters don't have to pay the record labels for music they air on terrestrial radio broadcasts, the federal appeals court in Philadelphia in 2003 upheld a lower court ruling that said radio stations have to pay royalties to the labels and recording artists when they stream their programming over the Internet."They took us to court in Philadelphia, and they lost," one record industry executive said. "They've made it clear to us that they do not want to let a Section 114 (the part of the copyright code that governs many music royalty payments) legislation move unless they can expand the exemption for over-the-air broadcasts to Internet streams."The broadcasters told Judiciary Committee chairman Sen. Arlen Specter, R-Penn., and Sen. Patrick Leahy, D-Vt., the panel's senior Democrat, that the panel should wait until after the lawsuit between XM and the record labels over the satellite radio company's digital recording service is completed."Final resolution of this lawsuit could well impact the interpretation of what constitutes fair use and thus how any digital audio protection system should be designed under copyright law," they wrote.The record labels say the broadcasters are simply confusing the matter. The XM suit and broadcaster's royalty obligations are two different things, they argue."That's all B.S.," the industry executive said. "The XM suit doesn't have anything to do with what broadcasters are trying to do. They just don't want to pay us."CEOs signing the letter include Clear Channel's Mark Mays, Cox Radio's Robert Neil, Emmis Communications' Jeff Smulyan and Entercom Communications' David Field.
(Link to article: HERE)

Here is the letter to Arlen Spector (LINK)

7/24/2006 02:16:00 PM

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