Radio's Case: Don't Rock The Boat

Charles Warfield

YMF Media executive Charles Warfield on behalf of the NAB is expected to testiday that the public good has been well-served under the current 90-year-old framework of music licensing.

Warfield will testify at today's second Judiciary subcommittee hearing that there is much to criticize regarding the complexity of the laws governing the music industry. But viewed through the lens of the public good, there should be little question that the  specific laws governing the relationship between the music and broadcast industries have been a resounding success in three ways.

He is expected to cite:

• "The current law has enabled a locally-focused, community-based broadcast industry that is completely free to listeners. This free service is unique among entertainment media, and doesn’t require a subscription, a broadband connection, or an expensive wireless data connection for access. Instead, it is completely free to anyone with an AM/FM antenna. Combined with an architecture that ensures that broadcast radio is always on in times of emergency, even when other forms of communication fail, broadcast radio has played a critical role in communities across America for decades. But make no mistake, maintaining this completely free model in an increasingly competitive and costly industry is a delicate balance. Like all other businesses, local radio stations represent brands created and maintained at great expense – from on-air talent and content-production costs to staffing and equipment. Radio broadcasters’ ability to continue offering their product under a completely free model is directly premised on the existing legal framework and resulting cost-structure. 
• The resulting popularity of broadcast radio – due to its cost (it’s free!), community-focus, and of course the product, which often includes music – has contributed to a U.S. recording industry that dwarfs the rest of the world both in terms of size and scope. This output of diverse and high quality musical works and sound recordings unquestionably benefits the public and flows from the current legal regime." 

According to Warfield's prepared testimoney,  the existing U.S. system of “free airplay for free promotion” has served both the broadcasting and recording industries well for decades. The U.S. is the most significant exporter of music and the largest creator for recorded music sales world-wide.

Further, the mutually beneficial relationship between broadcasters and the music industry, enabled by the existing law, has incentivized a U.S. recording industry is larger than that of the U.K, Germany, France and Italy combined, all of which impose performance royalties on over-the-air sound recordings.