 Nashville, TN (TOP40 Charts/ Universal Music Publishing Group) -- Officials at Savannah Music Group (SMG) and its subsidiary Savannah Records call for Congress to add an opt-out clause to allow radio stations to play the music of new and independent labels without additional payment to musicians and record labels. Savannah's proposal would leave intact existing writers' and publishers' royalties. Apparently pressured by the threat that Congress will enact a system whereby radio stations pay record companies and artists for airplay, in a highly unusual move, the National Association of Broadcasters (NAB) on Friday passed an emergency measure recommending that radio accept performance royalties. Historically, radio stations have not been obligated to pay record companies or artists because of the promotional value of airplay.
"This capitulation is a disaster not only for radio, but for independent artists, independent record labels and songwriters as well," says Jeff Cohen, Chief Executive Officer and co-founder of Savannah Music Group, an independent publishing and record company formed in 2008.
"I understand the politics of the NAB wanting to get ahead of a Congressional steamroller," says Dave Gibson, president and creative head of Savannah, "but there is no sense in flattening all the independents and creative shops in the process."
In public hearings, the radio industry has testified that a performance royalty will result in fewer stations playing music, and airplay being concentrated on already established artists. While this may benefit major, multi-national record companies, it will make things more difficult for new music and new artists to get the radio exposure they need to be successful, and thereby put small companies like Savannah and its artists at a disadvantage.
"We are grateful for the support that radio has given Savannah's music and artists," says Laurie Spoon, vice president of Savannah Records. "The possibility of losing music formats on radio would hurt both artists and musicians.
"Should a performance royalty be mandated by Congress, artists and labels must have the opportunity to opt out. If not, the major record labels win, and the songwriters and artists lose."
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