Pay The Composer, Not The Piper?

“If you dance to the music, don’t you know You’ve got to pay to the piper.”  Pay To The Piper, The Chairmen of the Board.

Since early radio days, the rules about who gets paid when music’s played have been clear.  The royalty lira go to he or she who wrote the music and lyrics.  Performers get the exposure and publicity of having their records beamed to the masses driving in their cars, listening on their transistors, or waking up to their clock radio.  But singers and players who record someone else’s compositions don’t get paid when their records are played on terrestrial radio.

Enter the Internet.  A game changer in every respect, including the music business.  That’s because for Cyberspace, Congress changed the rules.  When a record is streamed on a service such as Pandora, everyone gets paid–including the performers.

That’s good for singers like Brittany Spears who don’t write their own stuff and who can now count on another revenue stream. But for Internet radio, not so much.

As reported in a story aired this week on NPR, ttp://www.npr.org/blogs/therecord/2012/06/13/154871444/clear-channel-will-be-the-first-to-pay-royalties-for-music-on-its-air#more , the Copyright law for the new millenium saddles Pandora and other streaming services with heavy costs that terrestrial radio has never had to face.

One radio giant, Clear Channel, sees opportunity in this disparity between earth-bound and Internet radio.  It’s struck a deal with a major country music label to voluntarily pay performance royalites for terrestrial radio broadcasts.  In return, Clear Channel gets a better deal on its Internet royalty bill.  And that bold strategy to gain a discount on Internet payments could pay big dividends, as the popularity of terrestrial radio wanes against the surge of online streaming and other Internet music outlets.

Whether other radio stations will follow suit remains to be seen.  But one thing is certain, the Brave New World of Internet music will allow non-composing performers to boldly go where they have not gone before–to the bank.

QUOTE OF THE DAY: “The music business is a cruel and shallow money trench, a long plastic hallway where thieves and pimps run free, and good men die like dogs. There’s also a negative side …” -Hunter S. Thompson

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