Is the Radio Performance Tax Reverse Payola?

According to Merriam-Webster, the definition of payola is "Undercover or indirect payment (as to a disc jockey) for a commercial favor (as for promoting a particular recording)."

There are two bills in congress, H.R. 848 and S.379, that, if passed into law, would levy fees against radio stations for playing music. Wait... WHAT??? Isn't that one of the things radio is supposed to do? Play music so that people will hear it and then go out and BUY it?

To listen to the record companies and the artists themselves, you would think that radio is stealing their product. Since the dawn of entertainment-based broadcasting, radio has been used as a means to help promote music and artists. You hear the song, like it, and purchase it. Payola was even used as a mans to get radio stations to play songs more often because, say it with me... MORE AIRPLAY MEANS MORE SALES!!!

Now that the record companies are having trouble staying financially in the black, they are looking for new streams of revenue. Hey... let's charge the people that are helping us a fee. Keep in mind, that radio stations ALEADY pay a licensing fee for the music.

Radio is already in enough trouble. The major groups are all starting to file for bankruptcy protection, literally thousands of employees are being laid off, and syndication is becoming more the rule than the exception. Let's face it... from a financial standpoint, it's cheaper to have Ryan Seacrest host 100 of your morning shows than to actually pay for 100 morning shows. I'm not saying radio is innocent in all of this. Consolidation has more or less killed the industry. But... that is a different issue. If these bills pass into legislation, even more people will lose their jobs, and the small radio operators will probably disappear altogether. You will see a good majority of stations switch to talk/news/sports formats. In a lot of cases, it will be cheaper to just shut the transmitters down and call it a day. College radio? forget it... it will completely cease to exist.

And of course, the artist themselves are up in arms over this. "How dare radio play my music without compensating me?" Ummm... let's go back to paragraph #1. Airplay translates into sales. It's promotion. You provide the content, radio turn that into sales. And NOT just sales of music. We're talking ticket sales for concerts and merchandise... both multi-billion dollar industries. Bono has been one of the most outspoken performers in support of the tax. And he's one of the richest people in the galaxy! Click Here to read what the NAB had to say in response to Bono. I certainly understand that Bono does a LOT of charity work. I appreciate that. But if it wasn't for media airplay from early MTV and radio, U2 wouldn't be around today and Bono would probably be a bartender in Dublin instead of owning half of the city! Why do you think artists like the Grateful Dead, Phish, and Dave Matthews ENCOURAGE people to record and trade their music? They know that they might lose some music sales, but they are gaining in merchandise and ticket sales. And The Dead have been around in one form or another for almost 50 years! Sounds like they know what they are doing!

The only music you would probably hear on the radio is that of the biggest artists in the world... the U2s, Rolling Stones, Britney Spears... If you were a new artist trying to get heard, it wouldn't happen. Whatever happened to the thrill of a new artist hearing their song on the radio for the first time?

Yes... the musicians have a right to be paid for their material. I'm not disputing that. But it is the responsibility of the record companies to pay that. NOT the people trying to help them sell more records. If more artists were to examine their contracts BEFORE they signed them, or learned to negotiate better deals, then this wouldn't be an issue.

And how would radio pay for these fees if passed? Well, other than laying off even more people, advertising. I think that most "casual" listeners of radio would agree that there are too many commercials as it is. I think that a good average would be 12 to 13 commercials per hour split into 3 commercial "stopsets." If these laws pass, I have no doubt whatsoever that 20 minutes of commercials per hour would become common.

The record companies know they screwed up big-time when they didn't jump on the digital bandwagon. And now they are trying to make up for lost time. Piracy is rampant and it's because the music industry DIDN'T see digital music as a viable platform. For the record (no pun intended), my iPod currently has well over 28,000 songs on it, and it fits in my pocket. How many CDs would I need? The music industry needs to learn to embrace new platforms, not just decide to stick with the old ways of doing business. If they did this back in 1997, there would have been more safeguards against music piracy in place BEFORE it became a major issue.

So... back to the original question. Is this tax a form of revere payola? I think the answer is "yes." even though payola is illegal, record companies embraced it for years as a way to get their artists more "PROMOTION" by getting records more spins on the air. Now they are asking, no... demanding that radio pay them for the right to promote their music.

I would encourage people to take a look at this website... www.noperformancetax.org to get more information.

Don’t “get” Social Media? Think like a Musician.

2009. The year of the Social Media explosion. Thanks to Facebook and Twitter primarily, the world has found a new way to stay connected, interact and experience each other.

Of course, businesses and marketing types have noticed the power of these new fangled tools and the great ways they’re influencing both the masses and products.

One of the hottest new jobs in 2010 will be for people who know how to harness the power of these tools for individual companies and brands. Seminars are popping up everywhere with “experts” and “guru’s” willing to help explain this new landscape, why it’s important and what it all means. I’ve attended quite a few over the past year. Some have been worth attending. Many have just been common sense.

DISCLAIMER: I’m not an expert. I’m not a guru either. But I like to think I get it.

I like music. Like most people, it moves me. It’s been a part of me all my life, thanks largely to my Dad. I’ve personally interviewed at least a couple hundred certified Rock Stars over the years (real Rock Stars…not to be confused with the Social Media standouts claiming the title per their awesomeness). The beauty of musicians is their willingness to expose themselves to an audience. Their words are intimate, if only to them. They’re more so than not, authentic in their personality and not everyone gets them because of that – but that’s ok. They have a tribe of fans who do get them and are willing to do anything to champion the success of their star.

Musicians are tied to community. They’re passionate about cause and the human condition as it often feeds their inspiration. When they write (just like Twitter and Facebook status’s), their words reach out and relate to someone else who sees things as they do. It creates a connection and apparent conversation. It’s personal between the artist and listener.

U2 360

I had the pleasure of seeing U2’s 360 Tour at Carter Finley Stadium this year. From the minute I walked into the stadium Bono was speaking my language.

“Do you like our stage? We call it “The Claw”. We built it this way to get closer to you…to be more intimate”, he said. It reminded me more of a giant spaceship come to take us all away. I dare say by the end of the concert if Bono had said “climb aboard”, we all would have. He was that good.

He had me. Not only did he just drop a concept right out of the Social Media handbook, but the stage was set up like the popular island exhibits you see at conventions. At trade shows, it’s routine, but out of the numerous concerts I’d seen, this was the first for me. U2 accomplished what I’ve been telling my exhibit customers since the early 90’s. Use the structure to stage the tone and message, but get rid of obstructions and allow free flowing traffic. Remove the barriers. Allow access (if only in perception).

Throughout the show, Bono connected. He delivered the pillars that make Social Media so appealing; community, engagement, conversation, transparency, authenticity, content, intimacy.

Another one of the most well rounded shows I’ve ever seen ranked right up there with U2 is jazz musician and trumpeter Chris Botti. The show was flawless. It was just a great ride. It rocked. It swooned. At times, he made it big. Other times, he brought us in nice and close. It was an experience.

One of the more disappointing shows this year was blues guitar phenom Joe Bonamassa. He only said one brief thing the entire night…at the beginning. His performance on the guitar was breathtakingly impressive not doubt, but it was a one-sided show. He lacked content so he never engaged or connected…at least with me. The blues are chocked full of stories and emotions to draw on. I never felt his.

Sting

“If On A Winter’s Night” is the latest project from Sting. This past Sunday morning, CBS’s Sunday Morning with Charles Osgood featured an interview with the virtuoso. Sting talked about how playing in a church or pub is very different than playing a large stadium full of people. It’s a different mindset.

“In a large stadium event, your goal is to make it an intimate a setting as possible. In a small intimate setting, the goal is to make it an event.” [paraphrased]

Experienced musicians know how to connect. They make it personal regardless of the venue or transaction.

As your company moves into 2010 and considers implementing Social Media into its marketing and branding mix, keep this in mind. It’s not rocket science. It’s just personal.

We’ve all gotten comfortable over the years doing business a certain way and for the most part it worked, right? The barriers for your customers have been knocked down now. They have access to more information, education, choices and people now more than ever. They trust status updates and their friends more than what we as businesses tell them is good for them. We all can be replaced by something faster, better and cheaper in an instance.

The good news? It’s still all about the way you treat your customers. Remember the email and website explosion of the 90’s? This is so much cooler. Once again, you’ve got a new set of tools to play with…to stay connected, interact and experience each other.

The bigger the transaction, the more intimate it should be. The smaller the transaction – it’s still a big deal to them.

The world’s a stage. Go play.