News Dueling Editorials
posted by July 19 at 14:07 PMon
I didn’t plan it. And I’m sure they didn’t plan it either.
That’s no surprise.
What is surprising is that they take the knee-jerk liberal side and I take the right side (pun intended) … or the capitalist side!
The debate is over fees that webcasters have to pay artists. Since webcasting includes many nascent, low-income independents that are fueling creativity in this blossoming industry, there’s a desire to give them breathing room on paying performers for the right to play songs. I agree with that impulse: Indie musicians and indie webcasters both benefit from the freedom webcasters have to put music out there.
However, indie webcasters should not be able to stiff performers. SoundExchange, the group—like ASCAP or BMI in traditional radio, which collects and pays songwriter royalties—collects from webcasters and pays performers. They want to up the rate for big webcasters (companies that make above $1.25 million in revenues) and let indie webcasters continue to pay the rate as its been since 1998—10% of revenues, a rate the webcasters negotiated themselves.
Seems fair to me. However, Rep. Jay Inslee has a bill that would lower the rate for indies, making it 7.5% of revenues and lower the rate by 80% for the big webcasters. In this equation, musicians (like the whole Kill Rock Stars roster) would get shortchanged for their work. Again, I agree with Inslee’s impulse to help the indies, but since the indies and the big webcasters, like AOL and Clear Channel, are being fronted by the same big media lobbyist (DiMA), Inslee’s gotta appease both camps.
Lots of folks accuse SoundExchange of collecting the money, but not paying musicians. I asked them about this. Here are the numbers (and they are audited, btw): 17,000 artists have been paid in 2006 with an average payout of $360 for webcast plays. Also, SoundExchange does not pay through labels, they pay directly to the musicians.
Other critics have pointed out that SoundExchange would retroactively collect crushing fees once indies passed the $1.25 million revenue mark. SoundExchange Spokesperson Richard Ades says that is not true. “There is no retroactive billing. Once they cross the threshold, they start paying the new, higher rate. That’s the deal on the table.”
Indie musicians rely on indie webcasting. And indie musicians have rallied around Inslee’s bill saying that new rates will put the webcasters out of business and hurt indie musicians. That makes no sense. Indie webcasters have blossomed under the 10% rate of the last 10 years, and SoundExchange wants to keep that equation in play. They only want to raise the rate for big companies.
This is good news for musicians all around.