You, ArtiSans Label and the Performance Rights Act

Recently, the House Judiciary Committee approved legislation for something called the Performance Rights Act (H.R. 4789) in a 21-9 vote. The Performance Rights Act would force radio stations to pay artists and/or record labels whenever their recordings are played. As it currently stands, radio stations already pay songwriters whenever their songs are played on the radio, but the people who actually recorded the song (or who own the recordings) don’t get anything. The longstanding broadcasting argument has been that it is okay to not pay out due to the provision of free promotion for the music industry. But U.S. radio stations are just about the only ones who get away with this… As Warner Music Group (WMG) boss Edgar Bronfman Jr. likes to point out, there’s only a handful of other countries that give radio a free ride as the U.S. does, and those include North Korea and Iran.

Another aspect to keep in mind is that all of the internet webcasters already have to pay something and so does Sirius XM Satellite (SIRI). But this is poor representation as a model of pay out success because webcast sites are failing left and right and the satellite systems are billions of dollars in debt even with their merger. Regardless of the above stated issues, the Performance Rights Act comes down to the simple issue of a musician’s rights. Finally the government has noted the huge shift in the music industry and has decided to update its’ music laws.

The financial breakdown per title 17 Copyright law would be as follows: copyright holder (generally record label) would receive 50%, while 45% goes to the performing artist. Here is the kicker, take special note, artists who own their own copyrights benefit the MOST from the bill. They get the artist portion of 45% AND the copyright holder’s portion of 50%. This is just more incentive for musicians to do it yourself. Take heed from Radiohead, Trent Rezner of Nine Inch Nails, and older acts such as Prince and Nancy Sinatra who maintained their copyrights and artist integrity. More and more large scale musicians are dropping the traditional record label and releasing music in their own creative way.

The payout to record labels from radio stations might be a last ditch effort to save their outdated business model. Fortunately the new business model that ArtiSans Label has created allows the artist to keep 100% of their copyrights, royalties and any other generated income. If you are with ArtiSans, you are in good hands and may be seeing more money in the foreseeable future through the Performance Rights Act.

There is still a long ways to go for this bill to be passed. So far it was passed by the House Judiciary Committee; it has to go through the Senate Committee, then back to the Full House of Representatives, back to the Full Senate and then to President Barack Obama’s desk before it becomes law. Keep in mind this bill also has to filter through the large sea of piranhas (Washington lobbyists) before it can go anywhere. So we may see some changes and provisions to the bill, as it has to get through many gauntlets to survive. Industry watcher Glen Peoples has an optimistic view of the potential outcome of all of this. From his Coolfer blog:

One of two outcomes will come from today’s' three-and-a-half hour hearing on the Performance Rights Act: Either the committee will approve the Performance Rights Act or the National Association of Broadcasters and labels will reach their own agreement. It is very clear the committee members understand the promotional value of radio but think it is unfair that only radio stations get to decide the amount of that value. The issue of whether there should or should not be a performance right is all but decided. The issue to now be resolved is the value of the right and the timing of its introduction.

Touché said the salesman. How this might affect the music industry is very debatable and I challenge you (readers) to present different aspects that I did not touch on in this blog. After all, this is a topic that will not dissipate quietly anytime soon.