BY TRACY LEE TATE
Times Editor
Broadcast radio is free to anyone who want to listen. There are no fees to the listener, using the radios that some in their cars and entertainment centers, unlike subscription radio which requires special equipment and monthly fees.
While the music played by a broadcast (traditional) radio station is free to the listener, the cost of playing all those songs costs the station money and is, in fact a major part of a station’s overhead. A bill before the U.S. Congress would charge the stations a “performance fee,” a form of tax which charged the station to “pay to play.” For many small stations this would markedly increase their overhead with no guarantee of increased revenue – the main source of income (and operating funds) for the stations – advertising.
For small, local, stations, like Starke’s WEAG this could be a major financial blow as its main income comes from advertising dollars – the smaller the market the fewer the number of potential advertisers that are available and only a fraction of these actually purchase ads. Out of these funds must come equipment costs, maintenance of the equipment, utilities, building maintenance and talent fees. In many markets the local radio is one of the main sources for truly local news and community events and the closure of any of these stations would be a real negative for the community they serve.
According to WEAG owner Chuck Kramer, stations already pay fees for the use of the songs they play – not just as entertainment but as introductory and closing music – called bumper music – for coverage of local sports teams and other programming.
Currently, fees are paid to the American Society of Composers, Authors and Publishers (ASCAP). Broadcast Music International (BMI), the Society of European Stages, Authors and Composers (SESAC) and Global Music Rights (Worldwide). These fees are collected by these licensing agents and used to pay royalty fees to the publishers and writers of the music.
In an example provided by Kramer, his station must keep a log of all songs played, the name of the writer and/or composer and the artist performing the song. Some songs are in the public domain, meaning that they are older songs that have outlived their copyright – mostly songs more than 25 years old and standards, like the Star Spangled Banner.” For one month, WEAG paid $451 to BMI, just one of the licensing agents – with more fees to the others as well.
“This can run into thousands of dollars per year for a station,” Kramer said, “and these fees are a significant part of the station’s budget.”
Now, record labels are attempting to impose fees on stations for the benefit of the recording artists, who already get royalties on the sales of their music. Whether or not this fee will become law is a battle for Congress, with representatives lining up on both sides of the issue – advocates of the Performance Tax versus supporters of the Local Radio Freedom Act. Most of the radio stations in the country are against the Performance Tax, with supporters of the Local Radio Freedom Act are fewer in number – 29 votes shy of a majority against the Performance Tax in the House.
If the tax is enacted small, local stations will begin closing their doors within the first year, with others to follow soon after. All that could remain of traditional broadcast radio would be the all-talk show and sports channels and even they would be required to pay for the use of much of the bumper music they use.
Kramer said that while currently recovered to per-COVID levels, advertising declined sharply during the pandemic and the year after. While the budget is now back near the advertising level of before the pandemic, the experience shows how quickly a station could be in trouble when faced with yet more fees.
“Advertising was down throughout the entire industry,” Kramer said, “and just because the crises has passed that does not mean that is cannot happen again.”
Kramer said the best defense for radio against the Performance Tax lies with the listeners making their opposition to this threat to their listening pleasure.
“If everyone would contact their local congressional representative and senator and voice their opposition to this new tax it might sway some minds and meet the current 29 vote shortage to stopping the legislation,” Kramer said.
WEAG has been the community radio station for Bradford County and surrounding areas since it was founded in 1957 by a husband and wife team. It was sold to another couple in 1960, then to Ben and Ruth Dickerson in 1983. Ben Dickerson passed in 2019 and the station is now owned by Chuck and Mary Kramer.
