Will Congress Kill The Radio Star?
Is music worth money? That is a question that the music industry and consumers have been grappling over for more than a decade. But perhaps an even better question is: should congress decide what the value of music is, or should it be left up to the free market? I think the answer is very clear, it should be left up to the market like every other industry.
Radio stations currently do not have to pay artists or record labels to play their music. The thought behind this system is that radio stations offer free promotion for artists and drive sales of albums. For many years this was true, and since record labels made their money through album sales and artists made their money through tours and merchandise, the trade off worked.
That all changed in the early 2000’s when the music business took a hit from the availability of streaming services and downloads. Within a relatively short time period, the music industry saw its record sales and revenue plummet. For several years now, artists and labels have been lobbying congress unsuccessfully in an attempt to force radio to pay royalties in exchange for rotations. Most recently, they have introduced the “Fair Pay for Fair Play Act”, co-sponsored by Tennessee’s own Congresswoman Marsha Blackburn. The bill has been met with steep opposition from the National Association of Broadcasters.
So should radio be required to pay artists and labels in order to play their music? I’m not sure, there are definite pros and cons to both sides of the argument, but regardless, the matter is one that should be figured out by the label and the station-not in congress. These types of deals are already being worked out without the government’s involvement, with Clear Channel and the Big Machine Label Group reaching a deal all the way back in 2012 to pay the label a percentage of advertisement revenue.
Problems like this are the direct result of government’s interference in the free market. For far too long the government has inserted itself into the affairs of broadcasters and burdened the ability of business owners to broker agreements that work best for all parties involved. Perhaps instead of asking the government to negotiate payments the music industry should ask the government to get out of their business all together and allow the free market to make contracts on its own.