Indy Label Sides with Broadcasters on Performance Royalties

In a debate over whether musicians and record labels should get paid when their songs are on the radio, one start-up label is alone in opposing the new fees. Savannah Records of Nashville says the additional revenue isn’t worth the potential loss of radio exposure.

Tim McGraw’s “Something Like That” was on the radio more than any other song over the last decade.

SONG: “I worked so hard for that first kiss, and a heart don’t forget something like that.”

Every time the three-minute song got a spin, who was paid? The two writers and the publisher. Tim McGraw, the studio musicians and his record label didn’t make a cent, directly. These new performance royalties would change that.

Broadcasters have tried to block the proposal working its way through Congress, saying the additional expense would force stations to play less music or narrow their playlists to only established artists.

Tim McGraw will be fine either way. New artists might get another source of income, but only if they can get played on the radio. That’s why Savannah Records vice president Laurie Spoon is siding with broadcasters.

SPOON: “If you’re going to give me a little bit of money up front but it means that five other artists can’t get broken or we lose more music stations, then there’s not upside to that.”

Spoon says independent labels like hers should be able to opt-out of charging the new fees. That’s crazy, says Dave Pomeroy. The Nashville president of the American Federation of Musicians says players have been waiting too long to get paid for radio play.

POMEROY: “I’m sorry if it messes with the business plan of one particular organization, but I don’t think at this point their wanting to give away their music should be part of this legislation.”

The legislation is gaining traction. The National Association of Broadcasters is sitting down with musicians and labels trying to work out a deal.

Satellite and Internet radio stations already have to pay artists and record labels. Here’s an explanatory video by the non-profit that distributes the royalties.

For full disclosure, National Public Radio has been part of the opposition to paying additional royalties.