Everybody’s Hating On The CRA

Published in The Music Network

 

Commercial Radio Australia isn’t particularly popular at the moment. Ask around the labels, you won’t find a lot of love. In fact, the CRA’s content providers are so pissed off, they’re taking the trade association to task at the highest levels and from different angles. Commercial radio’s peak body is entangled in no less than three separate pieces of legal action with the music biz. Relations with record companies are at an alltime low. So why does everyone hate CRA?

Agendas, cash and communication are at the crux of it all. CRA simply follows its own agenda, and its members’ finances are in a handsome state. Metro ad revenue in Q1 rose to $151.1 million, up 7.7% from the same period last year, according to Deloitte-sourced data. The ad market has enjoyed revenue growth in every month since last November. Great if you’re a broadcaster, but an irritation to the labels who consistently blast radio for not paying fair rates, and for using the term “promotional value” much too loosely. Those arguments have crystallized in recent months with the PPCA taking action to remove the 1% price cap, a sweet deal commercial radio has operated under since the 1960s.

Nowhere is CRA’s agenda being challenged more vigorously than on the issue of local content quotas in the digital age. Since Australia’s DAB+ digital radio platform launched last May, the country’s digital-only stations have operated outside the broadcast quota system. CRA would like to see that continue. In an open letter published February 6th in The Australian newspaper, CRA informed readers it hoped to continue excluding digital-only radio from meeting content quotas by inserting a new clause (4.6) into Code 4 of the Commercial Radio Codes of Practice, a move that would “encourage diversity,” the ad read. In the rarest show of solidarity, the music business is in consensus against CRA on this one.

The whole lobbying structure of the Aussie biz has ranged against the idea. Labels association ARIA and its indies counterpart AIR have made submissions to the CRA prior to the March 19th deadline, as have APRA, umbrella lobbying body the Music Council of Australia, the Association of Artist Managers (part of the International Music Managers Forum), The Media, Entertainment and Arts Alliance, and Queensland University of Technology Professor Phil Graham. It’s the single hottest topic burning away in the Australia music industry.

“I just don’t accept the proposition that because it’s digital, somehow they should be free to abandon their obligations to promote Australian music,” comments Stephen Peach, the outgoing CEO of ARIA and PPCA. Labels are aggrieved at what they see as a move which could rob domestic acts of valuable exposure, while broadcasters insist that they need a quota-free environment to allow them to test the boundaries of the format.

“Let’s face it,” says David Vodicka, managing director of Melbourne-based indie the Rubber Group of Companies, “when has digital radio ever done anything about fostering diversity or cultural elements? Commercial radio is ultimately about return to investors and shareholders.” Opponents are insulted by the CRA’s decision to inform the industry primarily by means of a newspaper ad. “None of us were notified, even by email, that the review was underway so that we could make submissions,” says Peach. “We stumbled across the ad by accident.” Vodicka, who is also chairman of indie labels body AIR, says CRA’s attempts to communicate its plans were “extremely underhanded,” adding: “that’s no real consultation.”

The music industry, Warner blasts, is “trying to create some kind of hysteria over this by saying this is just a start. We simply believe there are certain innovative uses of digital spectrum that will cater to certain niche audiences that could not possible support Australian music.” She adds, “We’re not trying to get out of local content.”

At a cost estimated at around $55 million, CRA last year rolled out Australia’s digital radio platform DAB+ in the five big cities – Sydney, Melbourne, Brisbane, Perth and Adelaide. Up to 16 new digital-only stations currently operate in the metro centres. The country’s digital-only stations have since operated outside the broadcast quota system regulated by government agency the Australian Communications and Media Authority (ACMA) which obliges commercial free-to-air radio stations to devote no less than 25% of its airtime to Australian music for the most popular station formats.

Warner explains that the industry has been operating on the premise that, “as TV was given an exemption for new digital only services, this approach would be adopted to new digital-only radio services—we are now going through the process of seeking to formalise this exemption.”

ACMA has allowed new digital-only TV channels to remain free from any quota requirements until the national switchover from analog to digital delivery is completed in 2013. CRA wants that exemption to initially run until AMCA’s next review of the Codes, due to take place in 2013. At this stage, CRA has no such plan to pull the analog signal. CRA is currently mulling over the submissions, and will take its case to the ACMA at an unspecified time. However, the peak body will face a massive fight should it push for its proposed amendment. Association of Artist Managers Executive Director Nicole Brant-Zawadzki has lobbied the national minister of communications Stephen Conroy, describing the CRA proposal as “culturally and economically abhorrent”.

Richard Letts, executive director of the 50-member lobby group the MCA, reckons, “We must assume that if CRA wishes to remove the local content code, it is so that its members can broadcast no Australian music or less Australian music.” His comments are supported by AIR GM Nick O’Byrne. “The issue has long term implications for the health and growth of Australian content in its own market,” he says. “This sets up a worrying precedent.”

That’s “absolute rubbish,” says Warner. “We simply want to encourage stations to experiment with the technology.” She points to the example of network operator Austereo, which trialled short-term digital-only “pop-up” stations dedicated to US acts Pink and Lady Gaga to coincide with their recent Australian tours. ”We have absolutely no intention to not focus on local content in future, including local music,” notes Jeremy Macvean, head of digital strategy at Austereo. “Broadcasters just need the flexibility to create digital radio formats,” he adds, “to drive uptake of this new medium.” These “pop-up” stations have been the source of more bickering. When Austereo launched its temporary Pink Radio station last year, it triggered a flashpoint with Pink’s camp. Insiders from her record company Sony Music claim they weren’t properly consulted, or paid from the simulcast. The incident brought into the spotlight the license structure for ‘simultcasting’ via the Internet. Earlier this year, the PPCA filed papers with the Federal Court in which it contends that Internet simulcasting requires a separate licence. CRA, on the other hand, argues that it forms part of the existing broadcast licence and doesn’t require any additional licence or payment. A hearing is expected late June in the Federal Court.

Where money is concerned, the PPCA is like a dog with a bone. It’s not going to give up. And so it is that PPCA is attempting to rub out the long-standing caps which limit the royalties commercial stations – and indeed the Australian Broadcasting Corporation – pay to play recorded music. The commercial sector’s 261 stations currently pay an average rate of just 0.4% of total income, according to PPCA, a figure which translates to an annual fee of just $4 million. The commercial radio cap was introduced with the 1968 Copyright Act, which also set the performance fees paid by the government-funded ABC at a rate of $0.05 Australian per head of population.

The PPCA also wants to smash that figure, which currently contributes about $100,000 Australian ($90,000) annually to PPCA’s coffers. “There’s no justification for a price-cap,” says Peach. “It acts as a massive subsidy on recording artists and record labels for commercial radio, which is a very robust, profitable sector.” The PPCA hasn’t announced the rates it would seek, but it is understood the society is using as a template authors body APRA’s performance tariff, which slides from 0.5% to 3.5% of station revenue depending on each broadcaster’s level of music usage. Warner has said PPCA’s case is “all about increasing the profit margins of the multinational record companies at the expense of Australian commercial and public radio stations,” and reiterates that CRA’s members pay about $25 million each year in copyright fees, including sums paid to composers and songwriters through APRA. The High Court hearing is expected later this year. Should the PPCA successfully have the cap removed, it would then initiate negotiations with the CRA on revising the rates. The Copyright Tribunal may then be called upon to officiate. None of these industry-to-industry issues will go away.

The digital-radio quotas issue is just too hot, and radio would do well to back away. The price-cap situation is a pure cash-grab, but the radio sector has had it too good for too long. Ironically, radio seems either unwilling or unable to communicate with its content partners. When everything comes out in the wash, CRA and its members will ultimately have to fork out more for their content. “We’ve got a lot going on at the moment,” says Warner. That would be a massive understatement. Digital radio is off to an encouraging start in Australia. In its inaugural Digital Radio Industry Report, published March 22nd, CRA reported that 449,000 Australians were listening to digital radio in an average week. Since the DAB+ rollout in August 2009, CRA says more than 104,000 receivers have been shipped, ahead of full-year forecasts of 50,000 units.dy on recording artists and record labels for commercial radio, which is a very robust, profitable sector.” The PPCA hasn’t announced the rates it would seek, but it is understood the society is using as a template authors body APRA’s performance tariff, which slides from 0.5% to 3.5% of station revenue depending on each broadcaster’s level of music usage. Warner has said PPCA’s case is “all about increasing the profit margins of the multinational record companies at the expense of Australian commercial and public radio stations,” and reiterates that CRA’s members pay about $25 million each year in copyright fees, including sums paid to composers and songwriters through APRA. The High Court hearing is expected later this year. Should the PPCA successfully have the cap removed, it would then initiate negotiations with the CRA on revising the rates. The Copyright Tribunal may then be called upon to officiate. None of these industry-to-industry issues will go away.

The digital-radio quotas issue is just too hot, and radio would do well to back away. The price-cap situation is a pure cash-grab, but the radio sector has had it too good for too long. Ironically, radio seems either unwilling or unable to communicate with its content partners. When everything comes out in the wash, CRA and its members will ultimately have to fork out more for their content. “We’ve got a lot going on at the moment,” says Warner. That would be a massive understatement. Digital radio is off to an encouraging start in Australia. In its inaugural Digital Radio Industry Report, published March 22nd, CRA reported that 449,000 Australians were listening to digital radio in an average week. Since the DAB+ rollout in August 2009, CRA says more than 104,000 receivers have been shipped, ahead of full-year forecasts of 50,000 units.

 

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So Far, Soho

Published in Billboard Magazine

In February 2009, before the Aussie record biz even knew of alt-rock act Violent Soho’s existence, it signed to Universal-distributed Ecstatic Peace, the label helmed by the band’s hero, Sonic Youth’s Thurston Moore.

Another of the group’s idols, Gil Norton (Pixies, Echo & the Bunnymen, Foo Fighters) produced its self-titled debut album, released March 9 in North America. The single “Jesus Stole my Girlfriend” hit No. 38 on Billboard’s Rock Songs chart March 27 and climbed to No. 21 on the Modern Rock tally April 3.

Violent Soho laid a foundation for its stateside breakthrough on separate U.S. tours with Dinosaur Jr. and Built to Spill in the latter part of 2009—and it has a solid touring itinerary throughout 2010, says manager Dave Benge, director of Melbourne and Sydney-based Speak ‘n’ Spell. “For the immediate future, America is our focus,” he adds.

Violent Soho is represented by Mushroom Music Publishing and booked in the United States and United Kingdom by the Agency Group and in Australasia by Village Sounds. U.S. shows with the Bronx wrap April 22 in Anaheim, Calif., while U.K. dates will follow in May and an Australian tour kicks off in July.

“This is a long-term project,” Benge says, “that is going to slowly connect as we introduce the band to the world.”