TV Pays For Content, Why Not Radio?

According to a new study which takes the stand against performance royalties, being examined by congress, says that the more radio play a song gets the greater the album sales.

“There is a direct correlation between the number of ‘spins’ (plays on free, local radio) and the sales of albums or singles,” the report concluded. “It is this promotion – free advertising – that drives record sales and represents just one of the many ways local radio provides value to artists and contributes to their financial and commercial success.”

The study analysed airplay and sales for “17 artists covering all genres and varying levels of success such as Velvet Revolver, U2, Rascal Flatts, Linkin Park, Green Day, Bruce Springsteen, The White Stripes, Taylor Swift and Josh Groban,” and come up with the conclusion that playing songs on the radio encourages people go out buy the records they are on, increasing album sales. Can you say, “Duh!”? Really? Playing songs on the radio leads to increased album sales? Who would have thought!

This is the latest weapon the National Association of Broadcasters is using against the RIAA, and recording artists, to prevent having to pay out performance royalties, and it makes sense. If people don’t know you exist – hear your music – they won’t know to buy your album. So, in a sense, yes, this is free advertising for the album. Conversely, you could infer that the songs sell the advertising for the radio station.

Radio is in the business of selling advertising. Why would they give away free advertising if they need to sell advertising? Look at the list of bands includied in the study; some pretty big bands in there. Those are some really popular bands that keep people tuned into the radio. And the more people tuned into the radio station, the more a radio station can charge for the advertsing. If they were playing bands like mine, and the bands I work for, they would have less listeners and have to charge less for advertising. This would continue until they were forced to change format or go out of business. So, who needs who in this case?

I think it is time we the artists, the RIAA, and the NAB, start looking at radio as we do television. The movies, sitcoms, game shows, reality show and other programming are various forms of content that networks buy or lease, for broadcast in order to sell advertising. The more successful a program is the more they can charge for advertising. The least successful programming, and failures, are canceled because they cannot charge more for advertising around them.

Technically radio works the same way, except they don’t buy or lease their programming. (Well, with the exception of talk show hosts like Howard Stern, Opie and Anthony, Imus, Rush Limbaugh and others. It’s perfectly OK to pay for them to pay for that content.) But why shouldn’t radio work the same way and pay for the content that is broadcast? If radio were to follow the television model they would be buying or leasing each song for x amount of time with the option to cancel if a certain ratings target, ad revenue target wasn’t reached.

The performance royalty is a cheaper alternative to this. The station pays a blanket royalty fee, at the rate set by the Copyright Royalty Board, for all programming, rather than on an a la carte basis. As content providers, I think if we position the arguement this way we stand a chance getting the performance royalty. Otherwise, we could try something daring and NOT grant radio stations a license to play our music. But, to work this would have to have serious buy-in by the bands cited in that NAB study –  Velvet Revolver, U2, Rascal Flatts, Linkin Park, Green Day, Bruce Springsteen, The White Stripes, Taylor Swift and Josh Groban. Sure, if enough of us independent bands did this we could shut down many college stations and small, local broadcasters, which would encourage change, but it is the conglomerates like Clear Channel and Evergreen that really need to feel the pain before things change. They are leading the charge on behalf of these smaller stations.