NJBA Weekly Newsletter Friday, October 16, 2009 

Senate Committee Turns its Back on Broadcasters, and America

Late yesterday afternoon it became clear that there is only one thing standing between your station, your audience, and the music we love. The Senate Judiciary Committee! In a voice vote, the committee, under chairman Pat Leahy, decided to try and destroy local radio with a “one/two” combination, right to the bread-basket. This markup is the next step toward a law that would impose a tax on local radio stations, while refusing to offer any compensation for the free airplay and exposure that generate billions of dollars in annual sales for the labels. This is the first time that the Judiciary Committees in both Houses of Congress have approved the performance royalty, serving as a warning to broadcasters that this issue may well be moving to a showdown before the full House and Senate during the current session of Congress. This legislation could shutter many US radio stations. American jobs are at stake, as are the millions of dollars in nonprofit assistance to our communities and equality on our airwaves. 

Call Your Congressman and Senators Before it’s Too Late

Tell them to oppose the performance tax and support local radio by joining 25 other Senators on the Local Radio Freedom Act resolution. Not sure who your senator is or how to get in touch? Visit the Free Radio Action Center, and under the Contact Your Member section, you can find links to look up your members and get some talking point samples. Thank you for your continued support. 

And the Hits Just Keep on Coming

The House Committee on Energy and Commerce has unanimously approved the Local Radio Freedom Act, which would potentially open the door for hundreds of new low-power FMs by doing away with third-adjacent channel protection for full-power FMs. The bill would also require the FCC to ensure that licenses are available to LPFMs as well as translators, based on the "needs of the community," and would end the ban on former pirate operators obtaining LPFM licenses, which is a big concern here in New Jersey since we are beset by pirate operators popping up around the Garden State. The bill was approved last week by the House Subcommittee on Communications, Technology, and the Internet in a 15-1 vote. The next step is a vote in the full House. A similar bill is pending in the Senate and is now awaiting action by the Commerce, Science & Transportation Committee. 

What’s Next? Broadcasters Need to Stay on the Alert

The Performance Tax and the LPFM measures will do so much more harm than good. It is simply amazing that we are being forced to fight them in the trenches, as we have all summer. Well, this dilemma is  here whether we seek it or not: This is a fundamental issue between what and who WE are as broadcasters and how this proposed law will destroy OUR industry; WE should not be confused with other media who do not share our commitment to public service or bear our burdens and massive government imposed operational requirements. The NJBA takes no comfort in the postulate that “this measure has a long way to go” before it is law. Don’t believe it for a second. This bill is not moving along at this pace for the fun of it. It is not a legislative exercise in parliamentary gymnastics. It is a clear and present menace to our members.  It clearly has powerful friends in high places. And our message in opposition must get louder. The NJBA is asking our friends who love free over the air radio to become even more proactive in our opposition to this bill. Call your friends and colleagues and get them involved. Write and call your representatives and our Senators in Washington. Keep airing NJBA messages opposing the Performances Tax. And stay vigilant and focused with the great resolve needed to defeat these industry destroying measures! President Kennedy’s call to action seems particularly apropos in describing this situation we did not want or create: …”the times require imagination and courage and perseverance. I'm asking each of you to be pioneers ……... My call is to the young in heart, regardless of age -- to the stout in spirit, regardless of Party, to all who respond to the scriptural call: "Be strong and of a good courage; be not afraid, neither be [thou] dismayed. For courage, not complacency, is our need today; leadership, not salesmanship. And the only valid test of leadership is the ability to lead, and lead vigorously. There may be those who wish to hear more -- more promises to this group or that, more harsh rhetoric…….but our ends will not be won by rhetoric, and we can have faith in the future only if we have faith in ourselves. 

Poll: 75% Say They Oppose the Performance Tax

A clear majority of Americans oppose legislation backed by the Recording Industry Association of America (RIAA) that would force local radio stations to pay an additional fee for every song aired free to listeners, according to a poll released today by the National Association of Broadcasters. The poll reveals that 75 percent of participants do not support a performance fee levied on radio stations, and 85 percent recognize the promotional value radio airplay brings to artists and their music. The poll comes as Congressional opposition continues to grow. Sen. James Inhofe (OK), has become the most recent lawmaker to express opposition to the record label-backed legislation. Currently, a bipartisan group of 251 House lawmakers and 26 U.S. Senators oppose a performance tax on local radio stations. The poll, conducted August 24-31, 2009, randomly surveyed 1,000 likely voters nationwide to examine America's attitude toward the performance tax debate. Participants were questioned on their knowledge of the proposed legislation, and were given additional information about the issue from a May 6 article published by The Wall Street Journal. As part of the survey, 85 percent of those polled agreed with the statement that read, "Songs played on the radio help drive music sales, generating record sales annually for performers." Results here showed that 64 percent "strongly agreed" and 21 percent "somewhat agreed" with the statement. (So do most artists.) Commenting on the study, NJBA President Paul Rotella said, "This survey demonstrates that the more Americans know about a proposed performance tax, the more likely they are to oppose it. Simply put, a performance tax is bad for free, local radio. It's bad for radio's 235 million weekly listeners. And it's bad for the legions of new and legacy artists whose careers were launched and nurtured by free radio airplay." The survey, commissioned by NAB, was conducted by Wilson Research Strategies, a Washington, DC-based firm.  

Minority Broadcasters Voice Opposition to Performance Tax

One of the strongest and clearest voices against the oppressive Performance Tax is the coalition of minority broadcasters, who have not been shy in letting Congress know of the dangers posed to our industry by this wrong-headed proposal. The National Black Chamber of Commerce, Spanish Broadcasters Association, the Minority Media & Telecommunications Council and other minority broadcaster groups sent a letter asking the Judiciary Committee Chairman to back off on S. 379 because of the economic hardship it would allegedly impose. The Civil Rights groups correctly point out the myriad of problems this legislation will cause within the industry. 

SHVRA Also on Its Way to Full House
Also by a voice vote, the House Committee on Energy and Commerce has passed an extension of the Satellite Home Viewer Reauthorization Act (SHVRA) and sent it on to the full House for a vote. An important change approved Thursday would require the FCC to conduct a study on how the DTV conversion should impact determining which satellite customers are permitted to subscribe to out-of-market network affiliate feeds. 

FM Coming to iPod, iPhone and More

Some good news from Apple: It was revealed that Apple is set to activate sleeping FM capabilities in iPhones and iPod Touch, but it’s just the beginning. Apple broke the ice by dropping an FM into its new-generation iPod nano. Hopefully, someday soon everything from laptops to portable video games may also have an FM component. The cell phone market could give that effort momentum. 

CRB Orders Census Reporting

The Copyright Royalty Board has ordered that most digital music services provide "census reporting" of all songs played by their service, along with other information including the number of listeners who heard each song each time it was played.  The decision, published in the Federal Register, is a follow up to the Notice of Proposed Rulemaking, proposing this new permanent rule to replace the interim requirements that required that digital music services provide that information for two weeks each quarter.  The only exception to the new obligation was for "small broadcasters" - i.e. those broadcasters who are only obligated to pay the minimum $500 annual royalty. These small broadcasters will continue to report on the songs that they play for only two weeks each quarter.

Deadline Reached in Arbitron’s PPM Fight with NY’s AG

This week was the deadline for the New York market to have been accredited by under Arbitron’s agreement with New York Attorney General Andrew Cuomo, who took action over concerns about minority representation.   The settlement dictated Arbitron would win PPM accreditation by today or face a new round of legal action.   The company says it may not yet have the MRC blessing, but it has made "significant" improvements. The company meets with the MRC at least once a month.  Key issues remain response and compliance rates. Under the settlement’s terms, Arbitron was required to conduct a study looking for ratings bias and file it with Cuomo in July.  The company declined to make the document available and Cuomo’s office didn’t respond to requests for comment. The A-G already collected $300,000 in penalties.  Arbitron has faced similar action in New Jersey, Maryland and Florida, but only New York built in an accreditation deadline. 

Garden State Governor’s Race in Dead Heat

Republican Christopher Christie leads Gov. Jon Corzine 41%-40% -- a statistical dead heat - and independent Christopher Daggett is at 14%, according to a poll released this morning by Quinnipiac University. The race for governor has become tighter in recent weeks; a September 30 Quinnipiac poll had Christie ahead 43%-39% with 12% for Daggett, numbers that were just outside the margin of error. Vote by Mail for the First Time – Deadline Oct. 27: Voting has been made more convenient and easier than ever for New Jerseyans who find it difficult to get to the polls. To be eligible, you must complete the Application for Vote by Mail Ballot, and mail the application to your County Clerk up to seven days prior to the election, which is set for November 3^rd. 

QuickNews is provided for general information purposes only and should not be relied upon as legal or tax advice pertaining to any specific factual situation. Legal and tax related decisions should be made only after proper consultation with a legal professional of your choosing.