Will Britney Get a Bailout?

Published on March 10, 2009
by Peter Kafka

britneyCall me a crusty skeptic, but I think it’d be hard for entertainers–some of whom are already ostentatiously wealthy–to get Washington to help them out in the best of times.

So my gut is that there’s little chance that Congress will pass something called “The Performance Rights Act,” which would force radio stations to pay musicians–or at least, music labels–whenever they play one of their recordings.

Mind you, I think the musicians and their labels have a good argument here. Radio stations already pay songwriters whenever their songs are played on the radio–it’s one of the reasons that the music publishing business hasn’t fallen off a cliff even though CD sales have. But the people who actually recorded the song (or who own the recordings) don’t get anything.

The radio stations argue that this is OK because they’re providing free promotion for the industry. But U.S. terrestrial radio stations are just about the only ones who get away with this.

All of the of Internet Webcasters have to pay performers something, and so does Sirius XM Satellite (SIRI). And 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. Meanwhile, the industry needs the dough more than ever since its primary revenue source keeps falling away.

But… while there are less sympathetic lobbies than the music business, it sure would be easy for the radio stations, which have a pretty good handle on Washington, to knock this one down, no?

Slap up an ad with that shows Britney Spears driving with her kid on her lap or staggering around an MTV stage or cavorting with K-Fed, and run a simple tag line: “Britney wants more money. Tell Congress not to give her any.”

All that said, there are plenty of optimists who think the music industry is going to end up with some kind of extra dough in the end. Industry watcher Glenn Peoples is a smart guy, and he thinks that’s the case. From his Coolfer blog:

“One of two outcomes will come from todays’ 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 what 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.”

Glenn has comprehensive coverage of the House’s hearing about the issue today. Note the industry’s designated musician: Billy Corgan, best known as the angry bald dude who sang for the Smashing Pumpkins. By all accounts, he turned in an excellent performance today.

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