NAB Position: Performance Fee Would Costs Jobs

The long-held position of the National Association of Broadcasters is that a government-set performance fee, or tax, simply for airing music on the radio.

Ironically, radio is the number one promotional tool for record labels and performers. A performance fee could financially cripple local radio stations, putting jobs at risk, stifling new artists trying to break into the business and harming Americans who rely on local radio.

According to the NAB, for more than 80 years, record labels and performers have thrived from radio airplay – what is essentially free advertising – from local radio broadcasters. Free, broadcast radio touches nearly 243 million listeners a week, a number that dwarfs the reach of Internet and satellite radio.

A 2013 survey found that AM/FM radio is the top source for those seeking to learn about new music, far surpassing online and other sources. Free radio airplay provides the recording industry increased popularity, visibility and record sales. The promotion by local radio does not just include the music; it includes concert promotion, on-air interviews and online and social media marketing.

The fact is, the big record labels find themselves struggling economically and are seeking to recoup revenues on the backs of local radio stations that are, ironically, their greatest promotional tool.