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STELA, music royalties get heavy play in DC

Congressional leaders are gradually moving toward reauthorizing STELA when it expires at the end of this year, with two key committee hearings in the House last week signaling measured agreement on incorporating unrelated elements demanded by Pay-TV services.

Another wholly unrelated topic – assessing a Performance Tax on radio stations – also has become conflated with the STELA reauthorization, though the measure’s chief advocate – Rep. Marsha Blackburn, R-Tenn. – has opted instead to file separate legislation on the matter.

The House Judiciary Committee held a relatively narrow hearing on STELA, with many questions revolving around the number of households served by the distant signal license and potential results if it expires or is repealed, the increase in service disruptions and potential solutions, and viewers’ ability to receive in-state programming from outside their DMAs.  Draft legislation is expected in the near future.

The House Energy and Commerce Committee, meanwhile, passed on a voice vote a proposal reauthorizing STELA that excludes Pay-TV’s proposals to gut the retransmission consent system and strip local broadcast stations from the basic subscription tier.  But broadcasters are withholding full support for the package because it includes a ban on the joint negotiation of retransmission consent agreements that are not commonly owned which is more stringent than the recent FCC order that affected only the top four stations in a market.

Blackburn’s Performance Tax measure would block a television station from receiving retransmission consent payments if its parent company also owns a radio station that does not pay a performance royalty.  It is co-sponsored by Rep. Anna Eshoo, D-Calif.  Both serve on the Energy and Commerce Committee.

The measure ignores the multi-billion dollar promotional value that radio provides artists and record labels, as well as the $500 million broadcasters already pay each year in songwriter royalties.

A separate bill called the Songwriter Equity Act which would increase fees all platforms are required to pay ASCAP and BMI was the focus of an ASCAP artist lobbying effort on Capitol Hill last week.  Texas broadcasters in key congressional districts weighed in on the issue to ensure their lawmakers understand the legislation’s full effect on the music industry and local communities.

This measure, H.R. 4979, is not expected to advance this year but will likely be considered in the context of a broader update of the Copyright Act.

Questions?  Contact TAB's Oscar Rodriguez or call (512) 322-9944.

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