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Regulators Probe Broadcasters’ Actions in Fee Dispute
By Todd Shields
www.bloomberg.com

Aug. 10 (Bloomberg) — Federal regulators are reviewing whether broadcasters are refusing to air the music of artists who support payment of new fees for radio airplay.

The Federal Communications Commission said in an Aug. 7 notice that it is seeking comment on a petition filed June 9 by the MusicFirst Coalition, a Washington-based group that supports proposed legislation to create a performance royalty.

The FCC said it’s also seeking comment on radio stations’ “alleged refusal” to air ads in favor of the legislation, and whether broadcasters are disseminating “falsities” in a campaign coordinated by the National Association of Broadcasters, a trade group.

The inquiry involves “substantial First Amendment issues” and it’s not clear whether FCC action is needed or possible, the agency said in its notice.

The legislation to establish a royalty to be split between recording artists and labels cleared the House Judiciary Committee in May. Satellite and Internet radio already pay such fees. Similar legislation has been introduced in the Senate.

Dennis Wharton, a spokesman for the Washington-based broadcasters’ association, said in an e-mailed statement that MusicFirst’s petition contained “distortions.” He didn’t elaborate. Wharton said broadcasters are “under no obligation to carry everything that is offered or suggested to them.”

The MusicFirst Coalition in an e-mailed press release said it was “pleased that the FCC has taken the first step.”

Radio companies are using “the public airwaves to misinform policy makers and the public and punish artists and musicians for speaking out,” Jennifer Bendall, executive director of the coalition, said in the press release.

The coalition said its supporting groups include the Recording Industry Association of America, a Washington-based trade group whose members include music labels Warner Music Group Corp.,Sony Corp. and Vivendi SA.

To contact the reporter on this story: Todd Shields in Washington at tshields3@bloomberg.net