On April 3, Bloomberg.com published an interesting article on the on-going feud between radio and the recording industry.

Music stars and hometown broadcasters are going toe-to-toe in Washington as they lobby lawmakers on legislation that would make radio stations pay royalties to music labels and performers for playing their songs. The radio industry may be hit with annual fees of $2 billion or more if the bill passes, according to David Oxenford, a broadcast-industry lawyer in Washington.

Traditional radio stations are the only broadcasting system that does not pay fees at this time.  Satellite and Internet radio already pay the fees.  Traditional radio only pays when they stream their broadcasts over the web.

A spokesperson for the music industry testified that radio stations pay songwriters and music publishers and leave performers with “no form of compensation at all.  This issue is one of fundamental fairness.”

At this time, both music labels and radio stations are struggling with declining revenue.  Listeners are using the internet and recording devices like iPods.  Because of the decline of income, both sides are fighting this battle with all the resources they can muster.

The industries are spending millions to have their say in Washington. Broadcasters reported $45.5 million in expenses and campaign donations to influence Congress and federal agencies over the last two years, while the music industry doled out $30.8 million, according to the Center for Responsive Politics, a Washington-based research group. Each group outspent the trucking industry, home builders and coal-mining companies.

At this time, it seems that the music labels are winning endorsements from the committee members of the House and Senate.  However, according to David Kaut, an analyst in Washington DC, “the broadcasters are still a very formidable opposition.”

A spokesperson for Commonwealth Broadcast Corp. said that radio stations will have to reduce the news programs or fire employees if forced to pay the fees.  But a recording industry spokesman says the broadcasters are using scare tactics and over-inflated estimates.

Both sides are doing everything they can to influence the politicians to vote for their side.  They have hired lobbyists and, although both sides have lost revenue in the last year, they are spending millions to have the vote go their way.

Traditional Radio vs. the recording industry…..neither seems to be on high moral ground at this time.