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Global Radio boss says promotional value of radio play undervalued
By CMU Editorial | Published on Thursday 11 December 2008
The boss of commercial radio mega-firm Global Radio, Ashley Tabor, has called for a cut on the amount of money the commercial radio sector spends on music royalties each year, which is going to go down well with the record companies and publishing firms who see such royalties as an increasingly important revenue stream.
The commercial radio companies, via industry body RadioCentre, will begin negotiations over new royalty rates with collecting societies PRS and PPL in the New Year, but Tabor has got in early, wheeling out the oldest of arguments in this debate, which is that music companies underplay the importance of the promotional value radio stations offer when they play records.
He told Media Week: “A new balance needs to be struck. We play the material the record companies make, but the huge promotional value the music gets from airplay is worth more than is currently valued”.
Of course the labels and publishers will say that that argument is less convincing now than ever given that people are buying fewer and fewer records year on year, despite (and possibly because of) there being more and more radio stations playing music (so much so that in the US, where terrestrial radio stations have paid next to no royalties in the past because of the ‘promotional value’ argument, moves are afoot to try and force the radio world to start sharing its profits with the music industry).
That said, radio types might point out how important that A-list ranking on certain radio stations still is in breaking new talent. The labels may in turn point out the playlists that really really matter are Radio 1 and Radio 2, and therefore have nothing to do with the commercial radio royalty debate.
Anyway, I think it’s fair to say there’s going to be some quite vocal discussion once both sides sit down to negotiate in the new year.
In the meantime a spokesman for recording royalties body PPL told Music Week: “We look forward to our dialogue with the RadioCentre next year but PPL never discusses its negotiations with licensees in public. Our many thousands of record company members and our tens of thousands of performer members make a substantial personal and financial investment in their music. That music, in turn, is a central part of radio programming and the rates stations pay must reflect, in a fair way, its value to their business”.
