The American Music Fairness Act mandates that terrestrial radio broadcasters pay performance royalties for sound recordings, ensuring equitable treatment compared to digital services while providing protections for small stations and songwriters.
Marsha Blackburn
Senator
TN
The American Music Fairness Act updates federal copyright law to require terrestrial radio broadcasters to pay royalties for the music they play, ensuring equitable treatment with digital music services. The bill establishes a fair royalty-setting process while providing significant fee protections for small and local broadcasters. It also includes safeguards to ensure these changes do not negatively impact the royalties of songwriters or musical work copyright owners.
AM/FM Radio to Pay Artists for Music: New Royalties and Small Station Protections Included
For decades, traditional radio has enjoyed a unique loophole: they pay songwriters, but they don’t pay the performers or the labels who actually record the music. The American Music Fairness Act is designed to close that gap. By redefining "audio transmissions" to include analog AM/FM broadcasts (SEC. 2), the bill requires terrestrial radio stations to pay royalties for sound recordings, just like Spotify or SiriusXM already do. For the average listener, this might not change your morning commute immediately, but it shifts the financial landscape for the stations you rely on for news and tunes.
The Cost of the Airwaves
The bill doesn't just ask for money; it sets up a formal process to decide how much. The Copyright Royalty Judges are tasked with starting a proceeding to set rates through 2028, a process that will repeat every five years (SEC. 3). While big media conglomerates will likely face standard market rates, the bill acknowledges that a local station in a small town can't afford the same bill as a national network. To keep local radio alive, the bill creates a tiered discount system (SEC. 4). If a station earns less than $100,000 a year, their royalty fee is capped at just $10 annually. For mid-sized stations earning up to $1.5 million, the fee is $500. This protection is vital for the survival of independent and community-focused broadcasting.
Where the Money Goes
One of the most direct impacts of this bill is how it handles the "middleman." When digital services bypass standard licenses to strike direct deals with labels, the bill mandates that 50% of those royalties must still go to the collective that pays out the featured artists and background musicians (SEC. 5). This ensures that even if a big label makes a side deal, the singer and the drummer still get their cut. Additionally, the bill includes a "no harm" clause for songwriters (SEC. 6), ensuring that this new payment to performers doesn't come out of the pockets of the people who wrote the lyrics.
The Promotional Debate
In a nod to the long-standing argument that radio play is "free advertising" for artists, the bill requires judges to consider the promotional value of airplay when setting rates (SEC. 7). They have to weigh whether a song on the radio helps sell concert tickets and albums or if it simply replaces the need for fans to buy the music. This introduces a bit of a gray area—how do you accurately measure "promotional value" in the age of TikTok? While the bill aims for fairness, the complexity of these calculations and the new financial burden on broadcasters could lead to higher advertising costs or, in some cases, fewer stations on the dial if the tiered protections don't cover everyone efficiently.