Are You Leaving Money On the Table?

May 1, 2015

There are many challenges to maintaining your career as a professional musician. We live in a technology-driven world that has dramatically changed the way music is distributed, marketed, and sold. The drop in CD sales precipitated by illegal downloading has leveled off somewhat, but digital download sales have not compensated for the loss of income to musicians, record labels, and music publishers.

Live music continues to thrive, but the competition is fierce, and many venues and promoters use the dreaded “this is great exposure” justification for underpaying support acts and independent artists who are trying to build an audience. There are also unscrupulous film and TV placement “experts” who are actually experts at deceiving writers, publishers, and copyright owners into believing that no film or TV companies will use recordings made under an AFM contract in order to line their own pockets with money that should go to musicians.

Because of these factors and others, it is more important than ever to maximize every possible revenue stream by not leaving money on the table. Here’s one prime example: In almost every country worldwide, featured performers, copyright owners, backup musicians, and background vocalists share in royalties paid by terrestrial (AM/FM) broadcasters. There are only a few exceptions to this: Iran, North Korea, mainland China, Rwanda, and—believe it or not—the United States!

In the US, the rich and powerful broadcasting lobby has kept this legitimate and significant revenue stream off the table for decades. The only people who get paid for AM/FM radio play are publishers and songwriters. Our efforts to get musicians paid their fair share are in no way an attempt to take money away from anyone else. We are only asking for the same treatment musicians get almost everywhere in the world.

In 2009, the AFM was part of a concerted effort by a wide coalition of music industry stakeholders to pass legislation creating performance rights for musicians and singers left behind by the broadcasters, who make about $16 billion a year in ad revenue. It was a valiant effort, but fell short in the political upheaval leading up to the 2010 mid-term elections.

On April 13, 2015, new performance rights legislation, now known as the Fair Play, Fair Pay Act, was announced at a press conference in New York City by Representatives Marsha Blackburn from Tennessee and Jerrold Nadler from New York. I attended the event, along with a broad cross-section of musicians and recording artists, including Ben Allison, Rosanne Cash, Lou Marini, Jack DeJohnette, and Elvis Costello of Local 802 (New York City); Ray Parker, Jr. of Locals 47 (Los Angeles, CA) and 5 (Detroit, MI); as well as AFM President Ray Hair and Local 802 President Tino Gagliardi, all of whom support this effort.

This proposed legislation is a major step forward in correcting decades of injustice. Some will claim that this is a “radio tax” that will put stations out of business. The truth is that under this legislation, which also restores the performance rights of musicians and vocalists who worked on records made before 1972, a radio station that makes less than $1 million in yearly revenue would pay a whopping $500 in performance royalties. Does that sound like something that will destroy the radio industry?

The lasting power of music has been well documented, and it is high time for all of us to stand up and speak out. The musicFIRST Coalition, of which the AFM is a proud member, has been at the forefront of this effort. Their website (www.musicfirstcoalition.org) is an ideal way to find out more. Contact your Congressional representatives in Washington directly so that they understand this is a grass-roots problem affecting thousands of people. There are millions of dollars in broadcasting revenue generated from our music being played overseas. Compare this with the amount of music made overseas that is played on the US radio and it is easy to see that this is a balance of trade issue.

One other important aspect to consider is the lasting power of an AFM contract. In Nashville we have successfully billed for New Uses of records made 40 to 50 years ago. The only reason we can do this is because they were done under the AFM Phono Agreement. When you get paid under the table, what you make that day is all you will ever make. We have recently billed for thousands of dollars in New Uses for independent records that have been used in movies, TV, and commercials.

If you don’t protect yourself by using an AFM contract, you are removing yourself from multiple revenue streams that will go on without you. Think about that the next time someone makes you an offer you should refuse. The AFM has your back in many ways, but if you don’t protect yourself on the front end, you throw our hard work on your behalf away—along with your future earnings.

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