Clear Channel paying royalties to artists
June 6, 2012
For as long as there's been radio, there's been disputes over the royalties involved in broadcasting music.
Yesterday a new wrinkle was added to that complex history.
Clear Channel Communications and Big Machine, a record label whose artists include Taylor Swift and Tim McGraw, have reached an agreement that will, for the first time in U.S. history, offer performance royalties for songs played over traditional radio.
That means that artists will receive compensation when their songs are played. Federal law has only required that songwriters and publishers be paid royalties in the past.
Already there's speculation over whether other record labels and radio owners will move to such a system, which is seen as a boon for online radio.
Clear Channel, which has pushed its web radio app iHeartRadio hard the past year, will pay lower rates for streaming songs online.
Major online radio player Pandora, which must pay royalties for every track it plays under a system that's slightly different from terrestrial radio, has long complained that it cannot turn a profit because so much of its money goes toward playing royalties.
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