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SiriusXM Holdings stock fell by more than 6% on Thursday after the satellite radio and streaming content company said it lost 173,000 subscribers in the quarter ending on June 30.
The company said it lost approximately 100,000 SiriusXM self-pay subscribers and 73,000 paid promotional subscribers. While that was an improvement from the same period last year, and churn remained steady at 1.5%, it caused a 5% decline in SiriusXM subscriber revenue and $0.42 year-over-year decrease in average revenue per user (ARPU) to $15.24. That pushed SiriusXM Holdings’ second quarter revenue down 3% to $2.18 billion, below analysts’ expectations.
On a call discussing the quarter’s earnings, executives sought to emphasize Sirius’ improved profit margin and lower operating expenses, despite signing big-ticket deals for podcast powerhouses like SmartLess Media earlier this year.
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“SiriusXM’s financial position remains robust as we steadily enhance our business and establish a sustainable foundation for growth,” Sirius CEO Jennifer Witz said on the call, reiterating the company’s 2024 financial targets. “With these solid margins and declining capital expenditures, we anticipate converting more of this strong EBITDA into growing free cash flow in the coming years.”
Quarterly profit rose 2% to $316 million. Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) was flat year over year at $702 million and its adjusted EBITDA margin held steady at 32%.
Sirius reported operating expenses fell 5.5% on lower costs of running SiriusXM and Pandora and off-platform services across the board and lower personnel costs after the companies’ two rounds of layoffs over the last 18 months. Subscriber acquisition costs decreased by 1%. Free cash flow in the quarter rose 6% to $343 million.
“We think the key for the stock is conversion of self-pay trials,” Steven Cahill, equity analyst at Wells Fargo, wrote in a report for investors on Thursday. “Self-pay conversion in new [and] used car is arguably [SiriusXM Holdings’] biggest key performance indicator as it looks to improve capture of younger car buyers versus digital competition. We think Q2 self-pay converstion were down to around 30%-32% from 33% in the prior quarter.”
While SiriusXM saw declines in both subscriber and advertising revenue, Pandora and off-platform segments reported an 8% rise in subscriber revenue to $138 million. The segment’s advertising revenue held flat at $400 million from the same quarter a year ago.
Late last year, Sirius announced plans for a 10-to-1 reverse stock split and merger with Liberty Media’s SiriusXM Group tracking stock, a move aimed at bolstering the company’s faltering stock price. Executives said Thursday that transaction will close on Sept. 9. The Nasdaq-listed SiriusXM Holdings has seen its stock price fall by more than 65% from a 52-week high of $7.95, leading the Nasdaq to drop SiriusXM from its Nasdaq-100 Index last Thursday (June 13).
SiriusXM’s stock price was down 6.25% to $3.22 as of 12.25 p.m. New York time.
Teddy Swims’ “Lose Control” has been inescapable this year: Only two songs, Benson Boone‘s “Beautiful Things” and Zach Bryan‘s “I Remember Everything,” amassed more on-demand audio streams in the first six months of 2024 in the U.S., according to Luminate. Swims’ breakout single has also been embraced by five different radio formats, ranging from pop to Adult R&B to mainstream R&B/hip-hop.
Historically, it’s not unusual for the biggest hits to perform well at multiple radio formats. Before the streaming era, in fact, this was basically a prerequisite to becoming a runaway smash.
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But while songs often used to move gradually from one format to the next, conquering fresh territory on the airwaves over a period of many months, this process can now happen all at once. Shaboozey’s “A Bar Song (Tipsy)” made history by hitting the top 10 in four formats simultaneously, becoming the first song to reach that mark on Billboard‘s Pop Airplay, Adult Pop Airplay, Rhythmic Airplay and Country Airplay charts. Beyoncé, who helped introduce Shaboozey to a wide audience by featuring him on her Cowboy Carter album, was also top 15 in four formats for a week in April.
As labels push fewer songs to radio, veteran programmers believe it’s likely that more hit singles will be played heavily by multiple formats simultaneously. This potentially makes individual formats less exclusive, but it also allows radio to flex what remains of its mass-market power in an era dominated by streaming.
“Right now, we’re pretty desperate for hits that everyone agrees on,” says Matt Johnson, program director for WPLW, a top 40 station in Raleigh, North Carolina. “Streaming has changed how people consume music, and they’re not as siloed as they were 10 or 15 years ago. So if it’s a quality record, they tend to have a wider footprint across multiple formats.”
“When a song moves at the speed of TikTok, it’s almost like deliberately choosing to lose momentum by going to one format and then going to another two months later,” adds Sean Ross, author of the weekly Ross on Radio newsletter. Now, “It’s less about songs crossing from one format to another,” and more about songs “crossing from streaming to radio.”
Before the streaming era, some superstars promoted different singles to different formats, wooing Top 40 stations with straight-ahead pop, for example, but courting R&B radio with another sound altogether. It’s long been the case that singles that thrived at multiple formats typically grew at one before spilling over into the next. This sequential system for achieving airplay was partially driven by the way labels promoted tracks. “We were just following the patterns of the record labels,” says Tom Poleman, chief programming officer at iHeartMedia.
Labels often promote rap singles, for example, to mainstream R&B/hip-hop radio first, explains Motti Shulman, who recently left promotion after more than three decades. “We’d impact the record at rhythmic three or four weeks after that, so it already was a little more familiar,” Shulman says. “If it was really big, usually like top 10, then a handful of the more progressive pop stations would jump in. And if it worked there, then it could go all the way.”
In addition, labels and radio used to have to wait for “callout research” — audience surveys that helped them determine if a song was eliciting an enthusiastic response or causing listeners to tune out. That process took weeks, if not months, according to Shulman: “You needed at least 100 to 150 spins on a record during the day” before a track’s merits could be judged accurately. It took time for a song to build enough momentum in one format that another would test it out.
Many radio stations still look at those research reports. But while they’re waiting for them, they now have oodles of information to gauge audience demand — they can check streams and Shazams in their market on a daily basis. “We have more data at our fingertips,” Poleman says. “So if we see something really taking off, we think, why wait?”
There’s another factor driving cross-format pickup: “Labels are serving up fewer songs to us,” says Patti Marshall, managing director of branding and content
for four Hubbard Broadcasting-owned radio stations in Cincinnati. “Multiple formats are out there looking for really good music” — and there aren’t as many tracks for them to choose from. “There are about 55 to 60 songs above 100 spins at most radio formats,” Ross says. “That number used to be closer to 100 songs.”
Labels have pulled back because the benefit of a radio hit is not always clear at a time when streaming drives so much of their revenue. “It was so expensive to work songs — doing promotions and flyaways and paying indies [freelance radio promoters],” Shulman explains. “It didn’t always move the needle on streams. So we were impacting a lot fewer records to radio.”
All these forces have combined to reduce some of programmers’ longstanding reluctance when it comes to sharing songs with other formats. “I’m a little selfish,” jokes Tim Roberts, Audacy’s vp of country. “I would love it if Shaboozey was only on the country format, just like I’d love if Morgan Wallen and ‘Fast Car’ by Luke Combs only lived on the country format.”
Chad Rufer, group director of programming for Bonneville International in Sacramento, Calif., also has “mixed feelings” about sharing big hits. “As a country programmer, you wish that pop stations would just leave it so I’m the only place that you can hear the Post Malone country album on the radio,” he says. “But on the other side of that, when it’s played on multiple formats, the audience’s passion for it just gets bigger.”
“There’s always a chance to become less unique” if stations in four, five, or six formats are all teeing up the same track, says Guy Zapoleon, a veteran radio consultant. Now that “streaming is such a huge force,” though, “and people want to make sure that their format reflects the hits, there’s going to be less thinking like that,” he adds. “I think you will continue to see the bigger hits cross over to multiple formats, and even reach the top 10.”
After Rufer heard Shaboozey’s “A Bar Song (Tipsy)” earlier this year, he added it to both the adult pop and country stations he oversees. “Whether it’s going into Kenny Chesney on one station or Ed Sheeran on the other, it sounds good,” he says. “It fits.”
Shaboozey’s “A Bar Song (Tipsy)” updates a long-standing country music tradition — drowning one’s sorrows in whiskey — by way of J-Kwon’s 2004 rap hit “Tipsy.” The first time the singer played it for his label, EMPIRE, one question was top of mind for those in attendance: “Everybody was like, ‘When are you going to country radio?’” recalls EMPIRE CEO Ghazi.
In Ghazi’s view, that was a “very limited” plan. He had a more ambitious one: Push the song to multiple formats simultaneously. “For a record like that,” he says, “it’s a no-brainer.” Shaboozey released “A Bar Song (Tipsy)” in April; within a month, EMPIRE was promoting it to five different segments of the airwaves.
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Radio promotion is traditionally expensive, which is why it’s one of the last frontiers in the music industry that is still dominated by the major labels. Yet “A Bar Song (Tipsy),” released by an independent, recently became the first single in history to crack the top 10 on Billboard’s Country Airplay, Pop Airplay, Adult Pop Airplay and Rhythmic Airplay charts. (Adult pop is like regular pop but more sedate, while rhythmic usually mixes rap, R&B and some dance music; the rankings are based on airplay from a panel of stations in each format.)
“It’s important that Shaboozey has been able to show that you can do that as an independent artist,” says Heather Vassar, senior vp of operations for EMPIRE in Nashville. “We had several offers from majors who wanted to work the record, and it was really important that we were able to stay true to how we operate” — and scale the charts without their help. All that airplay counts towards the Hot 100, which Shaboozey has topped twice in non-consecutive weeks; notably, when “A Bar Song (Tipsy)” rebounded to No. 1 on the latest ranking, it was down in streams and sales, but up 11% in radio audience.
Songs that do well in multiple spaces on the airwaves usually unite coalitions of similar-minded formats. Miley Cyrus’ “Flowers” and The Weeknd’s “Blinding Lights,” for example, both hit No. 1 at pop, adult pop and adult contemporary. “Typically pop will share a lot with adult contemporary,” says Tom Poleman, chief programming officer at iHeartMedia. “It’s a similar group [of listeners], just an older demographic.”
The biggest R&B hits, however, tend to amass a different base of support. Robin Thicke, Pharrell Williams and T.I.’s “Blurred Lines” and Mariah Carey’s “We Belong Together,” both massive radio hits, reached No. 1 at adult R&B, mainstream R&B/hip-hop, rhythmic and pop.
EMPIRE, which has been traditionally strong in hip-hop and Afrobeats, will often promote songs to mainstream R&B/hip-hop, rhythmic and pop, according to Ghazi. But Shaboozey’s combination of formats is unusual. Only 13 songs have ever appeared on all four of the charts where he is now romping inside the top 10.
Country radio in particular has faced criticism in recent years for being unwilling to support songs by women or Black artists. Despite this history, 30 stations played “A Bar Song (Tipsy)” in April before EMPIRE sent the track to country programmers on May 3. “The streaming numbers were undeniable, but I was wondering how long it would take to convince a terrestrial country radio program director” to play the track, says Johnny Chiang, lead programmer for country music at SiriusXM and Pandora. “I am pleasantly surprised that they got it pretty quick.”
EMPIRE brought in Magnolia Music, an indie promotion company that has worked with the singer Randy Houser, to handle its country radio campaign. “Country radio, respectfully, always wants loyalty from artists,” Vassar says. “There was curiosity — is this one-and-done? Is Shaboozey going to go elsewhere [and stop paying attention to country radio] after this?”
Not everyone was concerned, though. For Tim Roberts, Audacy’s vp of country, Shaboozey “was already accepted by a bunch of country artists, so it just seemed natural” to play him. He first learned about “A Bar Song (Tipsy)” from a DJ who told him it was filling the floor at Coyote Joes, a country nightclub outside of Detroit, where Roberts also serves as a brand manager for WYCD. Two Audacy stations, KMLE and WPAW, were among the first prominent supporters of the song.
To quell other programmers’ anxieties, EMPIRE played them the rest of Shaboozey’s album, which has plenty of country signifiers, from pedal steel guitars to a sample of a horse neighing. In addition, Vassar says, the label introduced the singer to programmers when they were able to, “so they can understand the world that he’s building.” Roberts met Shaboozey the week of the Academy of Country Music Awards; the singer Jelly Roll brought him out during a performance at Billy Bob’s.
After EMPIRE officially started pushing “A Bar Song (Tipsy)” to country radio in May, 43 more stations threw it into their playlists immediately, including 38 owned by iHeartMedia. The format accounts for more than 20% of the single’s airplay so far, second only to top 40.
Shaboozey’s efforts to conquer pop and adult pop were aided by the fact that those formats have been more receptive to country songs recently — last year, Luke Combs’ “Fast Car” and Morgan Wallen’s “Last Night” both crossed the divide. That sound “has been working at the top 40 format,” says Matt Johnson, program director for WPLW. “And when you combine that with a feel-good song as the weather is getting sweltering, that’s a recipe for a summertime hit.”
iHeartMedia felt similarly. “We got really aggressive at pop on that song because we saw it taking off,” Poleman says. Pop stations now account for more than 40% of Shaboozey’s airplay.
While there has been common ground recently between country and pop-adjacent formats, it’s still rare for country and rhythmic stations to share tracks. “Sometimes programmers follow the rulebook too much where it’s like, ‘This song doesn’t fit the normal criteria of what a rhythmic record should sound like,'” acknowledges Jonathan Steele, brand manager for KKFR in Phoenix. “I listen to everything and ask, is this going to alienate our audience? With Shaboozey, I knew my audience was going to get that hook stuck in their head.”
The rhythmic format was slower to welcome “A Bar Song (Tipsy)” relative to country and pop. But the track kept showing up on Shazam charts in places like Columbus, Ohio, where Chris Harris oversees WCKX, another rhythmic outlet. He started playing Shaboozey’s single in May, and he now has his eye on another alcohol-fueled country-rap fusion, Moneybagg Yo’s “Whiskey Whiskey,” a collaboration with Wallen.
Harris also “took a gamble” at his mainstream R&B/hip-hop station, WIZF, and added “A Bar Song (Tipsy)” there recently. “We got a great response,” he says. But this is the one format EMPIRE targeted where “A Bar Song (Tipsy)” has faltered, failing to get near the upper reaches of the chart.
Still, “Next week, we should be top five at four formats,” Ghazi says. “I’m going to take a stab at going No. 1 at all four. Why not?”
Jessica Hoy figured her show, Mornings With Bo and Jess on CKCE-FM (101.5 Today Radio) Calgary, Alberta, was about to undergo major changes. Her co-host, Bobby May, had already warned her that he planned to quit the station in March. Hoy did not expect management to fire her and replace the show with a podcast duo based nearly 200 miles away who are broadcast on multiple stations.
“I was quite shocked when I was let go,” says Hoy, who nevertheless points out that, these days, “A lot of stations are trying to cut costs.”
As broadcast companies contend with debt loads, advertising declines and competition from streaming services and popular podcasts like The Joe Rogan Experience, radio stations have spent the last few years laying off dozens of employees, including on-air talent. Once-popular morning shows are the latest casualties, including, in late June, WKTU-FM New York’s Carolina With Greg T and KZZU-FM Spokane, Wash.’s long-running Dave, Ken and Molly.
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“With longevity comes larger salaries, and if the return on investment isn’t there anymore, these significant moves have to be made,” says Lance Venta, owner and publisher of Radio Insight. “Most of these corporate communications groups look at the individuals as a line item on a spreadsheet.”
Sean Ross, who puts out the Ross on Radio newsletter, tells Billboard, “With a lot of heritage morning shows, radio stations find themselves in a trick bag where the show is simultaneously not quite as big as it used to be, less tenable financially after years of salary increases but is still the biggest asset the station has.”
Many of the recently fired morning-show stars did not respond to inquiries or declined to comment, as did the stations that terminated them. Carolina Bermudez, the laid-off co-host of iHeartMedia’s Carolina With Greg T, says she was “advised by my lawyer not to comment at this time,” and Kendall Hopkins of Dave, Ken and Molly says he would talk “when I’m free to.” But after Canada’s Pattison Media dropped Mornings With Bo and Jess, May posted an Instagram screed: “Radio is in terrible shape with the current CEOs and shareholders at hand nationwide and I HATE to see my coworkers go down with it. … Talents have unfortunately become just a number on a piece of paper.”
Tanner Jay, whose Jake and Tanner Show on WKSZ-FM Appleton, Wis., was canceled in November, adds that radio stations are “struggling,” and instead of spending more money on training and nurturing on-air talent, “They’re saying, ‘We might as well put all this money toward getting some Taylor Swift tickets to give away and having one or two people that have never done mornings.’”
His partner, Jake Kelly, with whom he continues to host a daily podcast, adds, “I don’t know if the higher-ups know exactly how to fix the problem. Maybe they’re just firing until they figure it out.”
Morning shows on music radio stations were once cultural and financial juggernauts — Howard Stern rose to fame on WXRK-FM New York in the 1980s, and Steve Harvey’s show on WGCI-FM Chicago helped him diversify beyond stand-up comedy and gain broader celebrity status in the ’90s. Stations still differentiate themselves regionally with flagship shows such as Winston and Mel on Denver’s Kool 105 and Mojo In the Morning on Detroit’s Channel 95.5. Many of these shows, including those by Audacy’s Gary Bryan and iHeart’s Ryan Seacrest, are syndicated and have podcasts of their own.
Kelly argues today’s broadcast morning-show hosts are overdue to update their content. Many shows, he says, rely on clichéd content such as “War of the Roses,” in which the hosts help couples confront each other on-air, often through pranks. “The fakeness of the laughter, the fakeness of the stories — Gen Zs can see through it if it’s not authentic,” he says. “My daughter’s 14, and I don’t know if she’s ever turned on the radio.”
Before their program director took them aside after a Wednesday broadcast and fired them, Kelly and Jay were moving away from conventional morning-show shtick toward more personal stories, including discussing alcoholism and family issues on-air. Their new approach did not change the station’s fortunes. Their station’s overall ratings declined in the Green Bay, Wis., market from spring 2022 to fall 2023, according to Radio Online.
Hoy, who currently works as a medical outreach coordinator for a dermatology clinic, praises her replacement crew, Crash & Mars, as “unbelievably talented.” She adds that a Calgary morning show based in Edmonton may appeal to the station’s finances, but not the community. “I do worry about what happens when local news and events happen,” she says. “It just breaks that connection with the listeners.”
A version of this story appeared in the July 20, 2024, issue of Billboard.
SoundExchange is suing a free streaming service called AccuRadio over allegations that the company failed to pay royalties for music, claiming the streamer has “directly harmed creators.”
In a lawsuit filed Friday in Washington D.C. federal court, SoundExchange accused AccuRadio of violating the federal law that governs how radio-like services pay royalties to record labels and artists for the right to publicly perform copyrighted sound recordings.
SoundExchange – the non-profit that collects and distributes such “statutory royalties” – says AccuRadio had always paid its full bill until 2016, when its payments “slowed” and then finally stopped in 2018.
“AccuRadio has directly harmed creators over the years by refusing to pay royalties for the use of protected recordings,” said Michael Huppe, SoundExchange’s president and CEO said in a statement on Monday. “Today, SoundExchange is standing up for creators through this lawsuit to protect the value of music and ensure creators are compensated fairly for their work. We hope AccuRadio will immediately reverse course and pay what they owe for the use of the music that sits at the foundation of its service.”
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Founded in 2000, AccuRadio boasts that it is “the only online music streaming service curated by human beings, not algorithms.” The company offers hundreds of ad-supported free music channels that users can further customize, including skipping songs they don’t like.
According to SoundExchange, after AccuRadio stopped paying its royalty bill, the two sides have attempted to negotiate a solution for years, including a so-called forbearance agreement last year in which the streamer agreed to make a set down payment and then regular additional payments. But after three months, SoundExchance claims AccuRadio defaulted on that agreement, too.
“The cumulative amount of defendant’s underpayment – which harms SoundExchange, as well as the performing artists and copyright owners on whose behalf it collects and distributes royalties – continues to grow with each passing month,” SoundExchange’s lawyers write in their complaint.
In addition to demanding payment, the lawsuit is seeking a preliminary injunction that would immediately force AccuRadio to either pay up or stop offering copyrighted music to its listenership.
“While defendant has defaulted on the payments due pursuant to the forbearance agreement, it continues to operate its multichannel internet radio service, providing access to over a thousand pre-developed music channels and access to millions of sound recordings,” the lawsuit reads. “Injunctive relief is reasonably necessary to stop defendant from abusing the statutory license and incurring further damages throughout the pendency of this litigation.”
AccuRadio did not immediately return a request for comment on Monday.
While K-pop artists tend to utilize a range of teaser photos and video clips to hype fans up for new music, the members of Stray Kids are heading to Apple Music’s radio waves to share more about the group’s upcoming ATE album.
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In the kickoff episode of All About Stray Kids Radio (which premieres today, July 8, on Apple Music 1), members Bang Chan and Felix share new details about the group’s forthcoming mini-album ATE (dropping July 19), reflect on their latest single, and discuss their latest playlist additions, favorite games of the moments and other insights about SKZ’s music.
Felix says ATE’s overall concept is “something we haven’t done.” Bang Chan agrees, adding that not only is the title track single fresh but “a lot of the other songs [are] as well, it’s all very different… what we recorded, it’s just showing a different side of Stray Kids.”
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In their charming Australian accents, the musical mates also discussed why the “Stray Kids Version” of their latest Billboard Hot 100 hit, the Charlie Puth–featuring “Lose My Breath,” was “a bit more special.” Plus, the duo shares the other songs on their current playlist, including Avril Lavigne’s “Complicated,” Linkin Park’s “New Divide,” King Gnu’s “Ichizu” and Avicii’s “Wake Me Up!”
STAYs can listen to the first episode of All About Stray Kids Radio coming July 8 at 10:00p.m. ET on Apple Music 1 at apple.co/_StrayKidsRadio. Subsequent episodes will be released every Tuesday, with All About Stray Kids Radio also available on-demand for Apple Music subscribers after airing on Apple Music 1. Each episode will also be available on Apple Podcasts one hour after broadcast. The show’s podcast trailer is here.
Ahead of the full episode tonight — sure to include even more reveals — check out these exclusive moments and show artwork Billboard can share ahead of the broadcast.
Courtesy of Apple Music
On What Fans Can Expect From ATE:
Felix: It’s been like nine months since we’ve done our comeback.
Bang Chan: Yeah, it’s been, like, what? Uh, eight months?
Felix: We did [“Lose My Breath”] so, like, you know, definitely fans can be like, “Oh, bro, like, what concept or what color are they going for this comeback album?” But definitely I reckon this is something we haven’t done in, like… this is our first time doing this kind of concept. And the music style is also very different. But then you can say, “Oh, wow, so this kinda song … it’s definitely Stray Kids’ style.” You know what I mean?
Bang Chan: It’s something that we haven’t done before — but, you know, not only with the title track… a lot of the other songs as well, it’s all very different. But, you know, in the end, it’s what we made. What we recorded. It’s just showing a different side of Stray Kids.
Felix: I think we fit it in the song pretty well.
Bang Chan: Yeah, yeah, yeah. Everyone did a really good job.
Felix: It matches so well with our color.
[embedded content]
On “Lose My Breath (Stray Kids Version)”:
Bang Chan: With all eight of our voices coming out on the song, it’s, I feel like it’s a bit more special. You know what I mean? Also it’s a very different Stray Kids song.
Felix: Yeah, it’s not like a song we would always do. But, then again, because it’s us doing it, I feel like we did a good job recording and preparing for this song so.
Bang Chan: Most of the time, I’d be, you know, 3RACHA would be directing this song. But everyone did such a great job, so, um, big shout to all the members. And, um, also, you know, I feel like, ’cause, you know, the weather’s getting so hot these days…“Lose My Breath,” it kinda cools you down when you listen to the song in this hot weather.
Felix: Yeah. No matter how hot it is, like 35 degrees [Celsius], it’s still good to listen to, you know?
[embedded content]
Bang Chan and Felix’s Favorite Stray Kids Songs:
Felix: What’s your favorite Stray Kids song?
Bang Chan: Bro, that’s so hard! I can’t choose! [Laughs.] Do you have one?
Felix: I have … actually, [my favorite was] “DOMINO.”
Bang Chan: “DOMINO”? “DOMINO” is pretty good. “DOMINO” is my wake-up alarm.
Felix: Oh, really?!
Bang Chan: ‘Cause it’s so loud from the start. [Singing.] And it just wakes me up straight away. I’m like, “Ah!”
[embedded content]
Bang Chan and Felix Talk Hobbies:
Felix: Is there anything you’re interested in these days?
Bang Chan: Ooh, interests … I don’t know … you know, I’ve been playing Genshin a lot these days.
Felix: Genshin a lot, yeah. Same here.
Bang Chan: Sometimes, when you bring your console out into schedule[s], we play Tekken together. Um, what else? I’ve been interested in soccer.
Felix: You’ve been playing soccer?
Bang Chan: Mm-hmm.
Felix: Oh yeah, you have. Bang Chan: Yeah. Futsal with the members, some other mates.
Felix: Oh yeah.
Bang Chan: Um, what else am I doing? I’ve been trying to work out a bit more frequently these days.
Felix: Oh. Ah, you have more hobbies then … You have, like, three hobbies then. Bang Chan: I guess so.
Felix: Like, working out, soccer, and then Genshin.
Bang Chan: To be honest, yeah. That does make sense. ‘Cause, I mean, you know me. I think a lot. And then I try to get out of mind — I try to, you know, find all these hobbies [Laughs.]
Felix: That’s good, man.
Another piece of legislation in Washington, D.C., is making its way through Congress that would pay artists and record labels for plays at terrestrial radio. If that sentence sounds familiar, that’s because the issue has long been present on Capitol Hill without managing to win a presidential signature.
In 1988, Frank Sinatra sent a letter to Paul McCartney, Stevie Wonder, Ella Fitzgerald, Bruce Springsteen and about 20 other music luminaries about a decades-old inconsistency in music copyright law. There’s no reason why the writer and publisher should be compensated for radio plays but not the performer, he argued. Sinatra foresaw an expeditious end to his activism. “We are optimistic that with a united effort, we will be able to achieve successful results within a reasonable period of time,” he wrote. But 36 years and numerous legislative attempts later, other artists are still working on the task.
The latest artist to pick up the baton is country icon Randy Travis, who appeared before a House Judiciary subcommittee hearing on Wednesday (June 26) in support of the latest legislation to address the issue, the American Music Fairness Act. Artists helped build radio in the U.S. and should be properly compensated, said Randy’s wife, Mary Travis (Randy has had difficulty speaking since suffering a stroke in 2013). Passing AMFA, she told lawmakers, “would make many old wrongs finally right.”
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The safest statement of the afternoon, though, went to Subcommittee chairman Rep. Darrell Issa, who admitted the hearing was “a repeat of some things we’ve seen in the past.” In recent memory, lawmakers have introduced the Performance Right Act in 2007 and 2009; the Free Market Royalty Act in 2013; Fair Play, Fair Pay in 2015 and 2017; the Ask Musicians for Music Act (AM-FM) in 2019; and now the AMFA in 2022 and 2023.
AMFA is like its predecessors in numerous ways: It provides accommodation for small broadcasters that reduce their royalty obligations. It protects the royalties paid to songwriters and music publishers for the performance of musical works on terrestrial radio. Most importantly, the bill codifies a performance right for sound recordings.
But is anything different about AMFA? “The language of the bill hasn’t changed since [the Performance Rights Act in 2009,” says Linda Bloss-Baum, associate director of American University’s business and entertainment program. “And I’d say kind of the appetite on both sides to have a meaningful negotiation hasn’t really changed either.”
The radio industry’s opposition to a new performance right certainly hasn’t changed. “A new performance royalty could spell the end for many local stations,” Curtis LeGeyt, president/CEO of the National Association of Broadcasters, said during Wednesday’s hearing. After surviving an advertising slowdown from the COVID-19 pandemic and facing the rise of streaming platforms, radio stations are arguably in worse financial shape than in years past. “Local broadcasters across this country are operating on extremely tight margins right now,” LeGeyt added.
The AMFA attempts to go easy on small broadcasters while holding regional and national conglomerates to a higher standard. Mike Huppe, president/CEO of SoundExchange, believes bill makes better accommodations for small broadcasters than its predecessors. Under the AMFA, stations that earn less than $1.5 million in annual revenue (and whose parent companies make less than $10 million in annual revenue) would pay $500 annually. Small, non-commercial stations with annual revenue of less than $100,000 would pay as little as $10 per year. “In that sense,” says Huppe, “this is the best bill for small broadcasters that there’s ever been.”
Unlike previous bills, the AMFA also includes language that says the Copyright Royalty Board, which would set royalty rates payable by stations, could take the promotional value of radio play, and the fact that stations currently pay sound recording royalties for streaming on their digital platforms, when setting rates. But that’s unnecessary, says David Oxenford, partner at Wilkinson Barker Knauer. “The section of the Copyright Act that deals with royalties that are payable to SoundExchange already has this part of the consideration” in determining how royalty rates are set, he says.
The main differences between the AMFA and its predecessors might not be found in the actual language of the bill. Market conditions have changed. At Wednesday’s hearing, lawmakers seemed more impatient and fed up than in years past.
In his closing remarks, Issa used his bully pulpit to warn broadcasters that Congressional intervention would be more painful than a negotiated deal with record labels. “I will tell you that at least this chair and the ranking member of the full committee, we stand ready to negotiate fairly small amounts to change a principle to get this behind us,” Issa said to LeGeyt. “And if you don’t take that, [then] quite frankly you have to live with the consequences.”
Issa’s tone suggests the climate in Washington, D.C., has changed. Huppe believes streaming and AI have made people more aware of the “inequities” facing creators. Issa is among the subcommittee members to have sponsored legislation to protect intellectual property from the threat of generative AI. Rep. Adam Schiff, another subcommittee member, was one of a trio of lawmakers to send a letter to the Registrar of the U.S. Copyright Office out of concern that Spotify’s decision to take a discounted mechanical royalty rate for its music-audiobook bundle was not in the spirit of the Music Modernization Act.
What’s more, radio could get a big boost from the AM Radio in Every Vehicle Act, which would mandate all automobiles manufactured in the U.S. to have AM radio. The bill would mandate technology that benefits radio broadcasters; FM stations, too, would presumably be included in in-dash stereos. Logically, at least, that could strengthen artists’ and labels’ argument.
“We’re not necessarily against the [AM Radio in Every Vehicle Act],” says Huppe, “but we would say, how can you possibly do that and not fix [the performance right] at the same time?”
Country star Randy Travis had members of Congress gushing and brought star power to an otherwise businesslike hearing titled “Radio, Music, and Copyrights: 100 Years of Inequity for Recording Artists,” held Wednesday (June 26) by the House Judiciary Subcommittee on Courts, Intellectual Property, and the Internet.
“This is a great honor,” said Rep. Darrell Issa (R-Calif.), chair of the subcommittee, adding that the other three witnesses “will have to live in his shadow.”
Travis, who has had difficulty speaking since suffering a stroke in 2013, was represented at the hearing by his wife, Mary Travis. His circumstances made him a fitting witness and supporter of the American Music Fairness Act (AMFA), a bill that would create a performance right for sound recordings at terrestrial radio. Unable to sing, Travis has given up touring and relies on royalties for his long-term health care. A country artist who performed others’ compositions would benefit from royalties from continued airplay on terrestrial radio.
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“This piece of legislation is essential to correct 100 year old issue regarding artists and non payment for their work performed on the most prominent music platform in America — one which they helped to build and sustain,” said Mary Travis.
AMFA would establish fair market value for radio performance royalties similarly to how rates are set for streaming platforms. It also compels foreign radio stations to pay U.S.-based artists for the performance of their songs. Outside of the U.S., radio stations commonly avoid paying performance royalties to American artists and record labels despite the existence of a similar performance right in those countries.
The bill would task the Copyright Royalty Board, the three-judge body that determines streaming, satellite radio and mechanical royalties rates, with setting the royalty rates for the new license. Under AMFA, stations that earn less than $1.5 million in annual revenue (and whose parent companies make less than $10 million in annual revenue) to pay $500 annually. Small, non-commercial stations with annual revenue less than $100,000 would pay as little as $10 per year.
“I think you’ve gotten the balance exactly right,” Mike Huppe, president and CEO of SoundExchange, told members of the committee. While small broadcasters would pay modest fees under AMFA, the large national corporations that dominate the broadcasting industry would pay more. Huppe argued they could easily afford it. “This is a $15 billion business in the US,” he said. “Eighty-eight percent of all Americans listen to radio. The biggest broadcast groups are becoming bigger and more powerful.”
Radio broadcasters don’t see it that way, though. Curtis LeGeyt, president and CEO of the National Association of Broadcasters, warned the committee that any additional royalties would be too much. “AMFA would impose a new royalty on local radio that is financially untenable for broadcasters of all sizes,” he said. Eddie Harrell Jr, regional vp and general manager of Radio One, agreed. “Make no mistake that a new performance royalty imposed on local stations would create harm for local stations, listeners and the recording industry itself,” said Harrell. Local broadcasters, he said, “are operating on extremely tight margins right now.”
The most dire warnings from LeGeyt and Harrell often centered around AMFA’s threat to radio stations’ ability to serve their communities. Because stations’ revenue are not growing, Harrell explained, any additional expense threatens services stations provide to their communities — he cited a program that collects donated items for needy families — and undermine their ability to broadcast during natural disasters. “Those are the things that are lost in what we do as opposed to just playing the music and so our ability to lead community efforts like that would be impacted by any new expense that we’d have to endure.”
While Huppe acknowledged the value radio stations provide to their communities, he wondered why musicians shouldn’t be paid when stations pay to syndicate talk radio shows and license sporting events. “Why should Randy Travis have to be the one to bear the load of this community effort and all the charitable work?,” Huppe asked.
Artificial intelligence’s threat to the music business was interspersed into the conversation about performance rights and royalties. Travis proved an exceptional witness on this topic, too, having recently released his first new track since his stroke in 2013, “Where That Came From,” with the help of generative AI software to recreate his voice. (Issa paused the hearing for a minute to play the song over the loudspeakers by pressing his smartphone next to his microphone.) “His piece of AI work was humanistic and artistic,” said Mary Travis. “And that’s the difference [between] the good and the bad AI.”
When asked by Rep. Jerry Nadler (D-NY) if users of generative AI software should be able to create unauthorized copies of a singer’s voice, Mary Travis was succinct: “Absolutely not,” she said flatly. Later, she compared unauthorized use of an artist’s voice to identity theft. “There needs to be laws that are in place to keep that from happening,” she said, “which means consent and compensation and attribution and provenance.”
But the hearing mostly focused on the economics of the radio business and the two sides’ inability to come to agreement. Huppe said the NAB’s strategy “is to run out the clock” and wait for another bill to be introduced in the next Congressional term. LeGeyt took “significant issue” with Huppe’s characterization and blamed the recording industry’s representatives for not supporting the conversations. “NAB stands willing to be in a conference room,” he said.
Rep. Issa, however, doubted LeGeyt’s willingness to make a deal with record labels. Noting that the NAB has been negotiating on Radio One’s behalf, Rep. Issa asked Harrell if his stations “would be willing to pay something to get this problem to go away?” “Mr. Chairman, I would not say that,” Harrell replied.
Minutes later, Issa took an admonishing tone with LeGeyt. The NAB did not offer “one penny” in higher royalties in their negotiations, Issa claimed, and if artists started to encourage people to listen only to radio station’s streaming offering, the cost to stations would be “far more than a modest concession,” said Issa.
The business of music has transformed in the last two decades, driven by technology that shattered barriers to entry and creators’ determination to control their destiny. At the 66th Grammy Awards earlier this year, more than half of the nominees were independent. And it’s more than just business: the indie movement has enabled diverse voices that could not be heard previously to occupy their rightful place in the industry. This makes music, and our society, more egalitarian and better.
Whether blues, punk, hip-hop or country, America’s most recognizable music genres started out in the indie sector, and today the association I lead has more than 750 members across 35 states, and most of them are small businesses with less than 50 employees. As the music industry has changed, so have they.
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Yet, some of the most important players in the music ecosystem cling to a bygone era that was dictated by the motto, “Might Makes Right.”
Exhibit A is iHeartRadio. The corporate behemoth controls 860-plus stations across the country that play over 50 million songs a year. Those songs helped iHeart’s multiplatform group — covering broadcast radio and national sales — generate more than $2.4 billion in 2023 alone, according to its latest earnings report.
But iHeart is stuck in 1990. It doesn’t bother discovering new artists. Instead, it overplays the hits and milks classic songs that were released decades ago. Despite the growing movement to achieve economic justice, iHeart denies artists and labels payment for their work.
Take a moment to reflect on that. iHeart makes $12 billion a year playing music but refuses to pay the hard working and talented people who perform and produce the songs that are the reason consumers tune-in in the first place. In its desperate attempt to cling to the past, iHeart and lobbyist group the National Association of Broadcasters (NAB) have spent nearly $100 million since 2020 lobbying Congress and spreading campaign contributions around to maintain the unfair status quo.
iHeart is powerful. But it’s on the wrong side of history. And it’s about to face what it hates most: a public forum where broadcasters must defend their craven practices. On Wednesday (June 26), the House Judiciary Committee will hold a hearing on the refusal of broadcasters to pay music creators for their work.
Richard James Burgess speaks onstage during the GRAMMY Influencer Activation at GRAMMY House during the 66th GRAMMY Awards on Feb. 1, 2024 in Los Angeles.
Jerod Harris/Getty Images for The Recording Academy
Of course, iHeartMedia CEO Bob Pittman won’t testify. He leaves the dirty work to the NAB. But that doesn’t matter. When the issue of compensation for AM/FM airplay is held in a public forum, broadcasters lose. That is why their lobbyists work so hard to prevent congressional hearings. But courageous members of Congress such as Reps. Darrell Issa (R-Calif.) and Jerry Nadler (D-NY) are making sure there is a public debate. And they have a solution to ending the injustice: the American Music Fairness Act, which would grant an AM/FM performance royalty. This bill would bring AM/FM radio into the 21st Century, and finally grant American recording artists the same rights enjoyed by their counterparts in almost every other country on the planet.
In the last two decades, how we discover and listen to music has dramatically changed, and not just the move from vinyl records to streaming. We can now ask a device in our house, such as Alexa, to play music, and it does. Spotify and SiriusXM are now buttons next to AM/FM on the dashboard of our cars. Polling from 2020 found that of the people who regard staying up to date on new music as important to them, only 11% turn to AM/FM radio to do so. Even in my generation, that number is only 27%. OK, Boomers!
We need to update the laws to catch up to these changes. It makes no sense if, when driving, music creators heard on SiriusX are being compensated, but not if you hear them on an AM/FM station. If you listen to radio programming through the iHeartMedia app on your phone, through a smart speaker, or even in your car, iHeart has to pay creators too. That’s why they have their hand out to Congress asking for a mandate to keep AM radios in cars.
The American Music Fairness Act brings justice and balance to the industry. Music creators get paid for their work. AM/FM stations have to pay just like the streaming services. And, because the legislation protects truly local radio stations, most stations in the country would pay just $10 to $500 a year to play music.
I know independent music creators, who I represent as president and CEO of the American Association of Independent Music, could definitely use the income from those royalties. My members love partnering with true locally controlled community radio stations, but the behemoths usually don’t take their calls. There are hundreds of thousands of artists and other creators who hustle and struggle to make a living by giving us the music we love.
This approach is fair, it’s equitable, and it’s just. And iHeart hates it.
Broadcasters try to create as much fear, uncertainty, and doubt to avoid doing what’s right. They claim a $500 annual fee to play music would decimate stations’ ability to broadcast emergency communications – then they hike the annual dues it charges its members. They cling to the asinine rationale that the alleged promotional value of radio play justifies their immoral scheme. Worse, broadcasters claim they shouldn’t have to pay for the songs they play while demanding Congress get more money for them when their content is used by YouTube and other platforms.
Broadcasters do all of this with a straight face. But time is running out. When the arc of justice comes around, iHeart and the National Association of Broadcasters will learn they are on the wrong side of history.
Dr. Richard James Burgess is an acclaimed musician, singer, songwriter, record producer, composer, author, manager, marketer and inventor, who presently serves as the president and CEO of the American Association of Independent Music (A2IM).
Sirius XM Holdings announced a 1-for-10 reverse stock split for its shareholders when it merges with Liberty Media’s SiriusXM Group tracking stock later this year, sending the streaming and satellite radio company’s stock up 4.5% on Tuesday (June 18). The stock split, which was announced in a filing on Sunday (June 16), is meant to […]