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NAB Radio Board Endorses Conditions for Performance Fee Resolution
Washington - Oct 25, 2010 - The National Association of Broadcasters Radio Board of Directors, meeting at its regularly scheduled fall board meeting in Washington, voted in favor of presenting Musicfirst representatives a legislative term sheet designed to resolve the longstanding performance fee issue. The Radio Board conditioned their support for this term sheet on the understanding that all provisions would remain part of any legislative package. This vote is subject to ratification by the NAB Joint Board of Directors, which will meet Oct. 26, 2010.
Under language included in the term sheet, music-playing terrestrial radio stations would agree to pay a limited performance fee, which would be set at between 0.25 percent and one percent of a station's net revenue, depending on a provision related to the penetration of radio-activated mobile phones in the United States. The endorsement from the NAB Radio Board was made with the understanding that any legislative resolution supported by NAB must include the following (verbatim wording from the NAB):
The term sheet provides accommodations for small radio station operators, noncommercial stations, religious broadcasters and incidental uses of music by news/talk and sports stations.
The term sheet also envisions that both the radio and music industry will work cooperatively to offer consumers more and better ways to listen to music.
The Radio Board's action is a culmination of more than a year of discussions and dialog between radio executives, the NAB and its membership, Musicfirst, and key leaders in Congress.
The term sheet as approved by the NAB Radio Board of Directors is posted at the NAB website.
In response, musicFIRST advisor Tom Matzzie made the following statement on behalf of the coalition. In response, musicFIRST advisor Tom Matzzie made the following statement on behalf of the coalition.
“While we are pleased that the radio broadcasters have for the first time acknowledged their obligation to pay the artists who are the foundation of their business, we are disappointed that they failed to vote on the deal both parties agreed upon in July. After a quick review, this new term sheet differs significantly from that agreement. We will be reviewing their term sheet further.”
NAB President and CEO Gordon Smith issued this statement in response to the suggestion that an agreement had been reached in July regarding the performance fee issue.
Smith said: "We are disappointed by comments from our friends at musicFirst representing that there was a definitive July agreement or a handshake settlement with NAB on terms for resolving the performance royalty issue. This is demonstrably false. If this were true, why would our two sides have continued with negotiations in August, September and October?"
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