SoundExchange Picks Up Sinatra’s Call To Arms
Yesterday was an unusual anniversary in the music business. It was the 30th anniversary of a somewhat famous letter Frank Sinatra wrote to address an unfairness in his industry. To be specific, on December 12, 1988 Sinatra penned an open letter decrying the issue of broadcast radio not paying any performance royalties on the music they play. Amazingly, 30 years later the industry is still grappling with the same situation. In a nod to the Chairman of the Board, SoundExchange’s CEO Michael Huppe used the occasion to write an Op-Ed piece in Billboard magazine, explaining why Sinatra’s argument is more relevant today than ever before.
Back in the day broadcast radio used the argument that the promotional function it served to promote artists and their music was the key driver of the music industry’s success. Without them there would be no record sales or concert tours in the first place. Therefore, they should be exempt from paying performance royalties. This argument has withstood for decades, and was even renewed in the Music Modernization Act which was signed into law just this past October. So yes, radio’s exemption from paying performance royalties is still alive and well today.
The problem Huppe points out is today there are so many other ways to discover music (especially via streaming), and these new distribution methods all pay performance royalties. So why should radio be treated any differently? Considering that broadcast radio is still a profitable business thanks to $14B+ in annual ad revenue, it’s harder than ever to defend radio not paying their fair share in royalties.
At least that’s what Sinatra would say if he were around today.