- 5 minutes ago
The U.S. is the only major music market where artists don’t get paid when their songs are played on FM/AM radio, but why? Michael Huppe, CEO of SoundExchange, breaks down the century-old laws that shaped American radio, and what SoundExchange is doing to push for artists to get paid on radio through efforts such as the American Music Fairness Act. He joins host Kristin Robinson to unpack the history of radio, from payola scandals, the creation of satellite and online radio, the rise of consolidation and the shift from tastemaker to follower status in the streaming era. With AI radio personalities and data-driven choices on the rise in 2025, the radio landscape will certainly keep evolving in the years to come.
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00:00:00Does radio still matter in 2025?
00:00:02In a time when music discovery is dominated by TikTok and streaming services,
00:00:07what purpose does radio serve to both music fans and the music industry?
00:00:11Today on the show, I'm talking to Michael Huppie, CEO of SoundExchange,
00:00:15an organization which collects money for artists in the U.S. on digital radio stations,
00:00:19to understand how radio still plays a role in the music industry today
00:00:22and how it's evolved since its beginnings over 100 years ago.
00:00:30Welcome back to On the Record, a music business podcast from Billboard and Sickbird Productions.
00:00:37Today, I'm talking to Mike Huppie about all things radio.
00:00:41I have to admit that I rarely listen to radio these days, and most of my friends don't either.
00:00:46But even though my friends and I seem to have fallen off of it,
00:00:49the reality is that radio is still decently strong in the U.S.
00:00:53About 8 in 10 Americans ages 12 and older listen to AM or FM radio,
00:00:58which is often called terrestrial radio, in a given week, according to Pew Research.
00:01:03It is true, however, that radio's popularity has waned significantly,
00:01:06down 10% from 2009 to 2022.
00:01:10And the way that we consume it is also changing.
00:01:13Nowadays, more and more people listen to radio on apps.
00:01:16More shows are syndicated nationwide.
00:01:18And some radio listeners have switched from terrestrial radio to internet or satellite radio,
00:01:23like Sirius XM, the latter of which often features artist-focused or holiday-specific stations
00:01:28to hit a much more targeted niche audience.
00:01:31Radio has an interesting relationship to the music industry.
00:01:34Dating back to the late 1930s, radio broadcasters warred against the rates
00:01:38that the then much bigger music publishing business was asking them to pay
00:01:43to license to play their music on air.
00:01:44Then, by the mid-20th century, music executives were accused of paying under-the-table bribes
00:01:50to radio DJs like Dick Clark and Alan Freed to get their songs in rotation,
00:01:55a phenomenon that's since been dubbed payola.
00:01:58And now that's since happened quite a few more times in the decades since.
00:02:02But here's the interesting thing about AM and FM radio specifically.
00:02:06Artists are actually not paid royalties when their song is played on the air.
00:02:10Only the songwriters are.
00:02:11For some of our newer listeners, please don't worry if you're confused by what I just said.
00:02:16My guest today will break down why and how this works during the episode.
00:02:19Anyways, now you have some context as to how radio works.
00:02:23I'm super excited to do this deep dive into this topic this week,
00:02:26so let's go ahead and bring out our guest.
00:02:29Please welcome to the show Michael Huppie, CEO of SoundExchange.
00:02:33Michael Huppie, thank you so much for coming to On The Record.
00:02:35It is a pleasure to be here.
00:02:36I'm really excited that you're here because one area of the music business that I admittedly
00:02:41don't know a ton about is radio.
00:02:44And I'm fascinated by it.
00:02:45It's still a major part of this industry.
00:02:48If you talk to any songwriters, that's an area that I report on a lot.
00:02:51Every songwriter will tell you how important radio is for them in terms of income.
00:02:55But radio has had a really interesting history along with the music business.
00:02:59I wanted to talk about that and all the stuff that you're doing at SoundExchange as well.
00:03:05So I guess to get started, though, I'm wondering, do you have any early memories of listening to radio?
00:03:11Well, sure.
00:03:11I mean, you know, radio, especially back then, radio was and still is everywhere, right?
00:03:17You know, radio even today.
00:03:18I mean, it's different, much different today than it used to be.
00:03:21But we're at a place now where 300 million people a month still hear FM radio.
00:03:25And I certainly remember listening to radios in the car on our, you know, our trips back
00:03:30when we would drive to family reunions instead of flying and things like that.
00:03:34So I think radio is probably a part of everyone's life, certainly, at my age anyway.
00:03:40Yeah, yeah.
00:03:41Were there any stations that you were into when you were a kid?
00:03:43Well, I grew up outside of Philly.
00:03:46So I remember I listened a lot to the classic rock stations.
00:03:50WMMR 93.3, WISP 94.1.
00:03:53And John DiBella in the morning.
00:03:55I imagine he's probably not still on the air, but you never know.
00:03:58I don't know the answer to that.
00:04:00When I think back to radio in my childhood, I was a child at the peak of Radio Disney,
00:04:06which I think is one of the most fascinating.
00:04:09At some point, I would love to do a, like, Disney-themed podcast episode
00:04:12because there was a time period in, like, the 2000s and 2010s
00:04:16where Disney had the number one children's radio station.
00:04:20They had Disney Channel, and they also had this record label with Hollywood Records.
00:04:25They still have that.
00:04:26But they could just plug everything across all of these different verticals,
00:04:30and they were just a marketing machine.
00:04:32It's brilliant.
00:04:33Yeah, it is brilliant.
00:04:35It is brilliant.
00:04:35But that's, like, my earliest memory of radio is just listening to that,
00:04:39and they actually shut it down.
00:04:41So Radio Disney is no longer a thing.
00:04:43I'm sorry.
00:04:43I know, I know.
00:04:44I don't think I would be listening to it now if it still was a thing.
00:04:49But, yeah, it was a moment in time.
00:04:51Admittedly, I feel like I don't listen to a ton of radio,
00:04:55and I think it's easy for people who don't listen to radio
00:04:58to think that radio is a thing of the past or that it's not very popular anymore.
00:05:03I'm wondering what can you kind of tell me about, like, the vibrancy of radio today
00:05:07and kind of what the radio market looks like with all the different options
00:05:11that we have between satellite radio, Internet radio, AM, FM, all that good stuff.
00:05:15Yeah, and it's funny.
00:05:16Even the term radio, you know, I assume when you ask me about radio,
00:05:19you mean sort of AM, FM, terrestrial over-the-air broadcast.
00:05:23Yeah.
00:05:23I will tell you, when I think about radio, I think about things beyond that.
00:05:26I mean, for this conversation, I know we'll focus a lot on terrestrial,
00:05:29but to me, you know, SiriusXM is radio, streaming.
00:05:33A lot of the stuff that Sound Exchange does, which I know we'll get into,
00:05:35deals with radio online.
00:05:37And so there's no question that radio is in a different position now
00:05:42than they were, you know, back in their heydays.
00:05:44If you think about radio, I guess radio was invented in 1896.
00:05:50I think Marconi was the one who did the first radio broadcast,
00:05:53but it really wasn't until the 20s and 30s that things got going
00:05:57where you had radio stations, record companies started to develop.
00:06:01And then in the 40s was kind of the golden age of radio
00:06:04where a lot of folks, it's when it really started to blossom.
00:06:07And back then in the 40s, 50s, 60s, it was one of the main and only ways
00:06:14to get exposed to music because you didn't have streaming,
00:06:16you didn't have satellites beaming stuff down,
00:06:18you didn't have, you know, cable TV channels pushing in radio only,
00:06:24you know, programming.
00:06:25So it was no doubt a bigger platform comparative to others back in the 40s and 50s.
00:06:34You know, it's been an interesting history like you talked about
00:06:37because if you think about, you know, the 40s when it really started to blossom,
00:06:42the 50s and 60s, they started to improve their quality
00:06:44and FM came into the scene for better sound quality.
00:06:50It wasn't just AM anymore.
00:06:51They started to do more music programming.
00:06:54Record companies and radios started to work a lot more closely together.
00:06:58Worked really closely together.
00:07:01You know.
00:07:02Perhaps a little payola.
00:07:04You know, there's obviously a history of that.
00:07:06But, you know, it doesn't happen now.
00:07:09Although you do know that it is actually legal still to pay a FM station
00:07:15to play your music, you simply have to announce it.
00:07:18Oh.
00:07:18Most people don't know that.
00:07:20Interesting.
00:07:20I'm not saying it happens rampantly, but I think it was the problems back in the,
00:07:26you know, in those many, many decades ago where, you know,
00:07:29you're supposedly entrusting the public airwaves to this broadcast entity
00:07:33for the public good, and they shouldn't be putting their thumb on the scale
00:07:36because of undisclosed compensation they're getting, you know, through the back door.
00:07:41I mean, I think a lot of people point to other forms of consumption now
00:07:45and ask, like, you know, whether or not there are other modern forms of payola.
00:07:50One of the things that, like, have come up a lot in the last few years
00:07:53is Spotify's discovery mode, which basically if you want to be part of discovery mode,
00:07:58you can accept a royalty that's 30% less than what the traditional stream is,
00:08:02and they will plug you in their algorithm more and more.
00:08:06And so it's interesting how the payola conversation always comes back up,
00:08:09just in different forms.
00:08:11Yes, and Spotify is a great platform, obviously very important to the industry,
00:08:15very important to artists.
00:08:16But when there is pressure for an artist to take a lower royalty,
00:08:21I think of it kind of as inverse payola,
00:08:23and I don't mean that in an illegal fashion or anything like that,
00:08:25but you're basically trying to get an individual artist or entity in the industry
00:08:30to take a financial hit in order to get more plays or more exposure.
00:08:36So it kind of is like an inverse payola, negative payola.
00:08:40I don't know the best way to describe it.
00:08:43And, you know, this happens, and radio and artists have always had this very interesting relationship,
00:08:51going back to the 40s and 30s.
00:08:55And in some ways, sometimes there's this prisoner's dilemma that comes up.
00:08:59If you're an individual artist, of course you'd rather be on radio than not, right?
00:09:03If I were managing an artist, of course you'd rather be on radio,
00:09:06of course you'd rather be on these platforms.
00:09:07But when you think about in an individual basis,
00:09:12there's things they can do to try to better their lot.
00:09:15But at Sound of Change, we think about the industry as a whole.
00:09:18It's like a macro view.
00:09:20And it's not always best for the whole ecosystem.
00:09:25I mean, everyone should do what they need to do according to their own financial interests.
00:09:28I'm not encouraging any group activity,
00:09:31but sometimes something that will benefit an individual artist
00:09:34is not always best for the whole industry in the long term.
00:09:37That's the best way to put it, I think.
00:09:39Can you explain that a little bit more?
00:09:40To get on Spotify, and I'm not saying this is what happens,
00:09:44but if it all becomes a race to the bottom
00:09:45for whoever's willing to give Spotify their music for the least amount,
00:09:51that's not healthy for the industry.
00:09:54Yeah, yeah.
00:09:54I mean, historically, I feel like music has always kind of been racing to the bottom,
00:09:58or at least it's been accused of being in a race to the bottom for a long time.
00:10:02I want to get into, with radio, how talent is compensated.
00:10:08Music's obviously always been a really big part of radio.
00:10:11I know there's also talk radio and other formats that don't require music to be played,
00:10:15but on a lot of stations, music is the primary driver.
00:10:20So how does it work?
00:10:21Let's start with the AM-FM terrestrial radio,
00:10:24and then we can also work into the newer formats like your satellite and online radio.
00:10:29How are musicians paid?
00:10:33So on AM-FM radio, you know, when you hear a particular recording,
00:10:40so let's take RASPCT by Aretha Franklin, right?
00:10:43And Otis Redding is the songwriter, as you probably know.
00:10:46You know, on terrestrial radio in this country,
00:10:49the songwriters get paid whenever their song is performed by them or by anybody else.
00:10:53And by the way, that's how it should be.
00:10:55Songwriters are a critical part of the process.
00:10:57It all begins with a song, as you've probably heard,
00:10:59probably from someone in this chair before, including friends of mine.
00:11:04So they should.
00:11:05They should get just compensation.
00:11:06And I'm not so sure, you know, they're getting adequately compensated either.
00:11:09But in this country, recording artists get nothing.
00:11:12When you hear that song over a local, you know, classic rock station or, you know,
00:11:18a R&B station, Aretha and her team and her record label make nothing.
00:11:25And that is an extremely unusual exception in the world.
00:11:29We're the only industrialized country where that's true.
00:11:32Every other industrialized democratic country, both Otis and Aretha get paid.
00:11:36And it makes sense, right?
00:11:38Radio makes you, you asked about the viability earlier.
00:11:40It's still a $14 billion business.
00:11:43The big radio companies have pretty good margins.
00:11:45They have margins that a lot of other companies would kill for.
00:11:48And they're not paying for their primary input.
00:11:51I think what's interesting about that is I, ahead of this interview,
00:11:54I was talking to some friends of mine who work at record labels,
00:11:58a couple of people who run indie labels specifically,
00:12:00and asking them about, have you done a radio campaign before?
00:12:03What is it like?
00:12:05And there's this one indie label guy who was telling me about how he spent
00:12:09hundreds of thousands of dollars taking one of his songs to radio.
00:12:12It was really starting to go viral on TikTok.
00:12:14Then it went really well on streaming services.
00:12:16And they decided to take it to radio,
00:12:18thinking that it was going to be viable there as well.
00:12:21And it did end up being a huge radio hit.
00:12:23But they spent hundreds of thousands of dollars to try to promote that song at radio.
00:12:27And then he said that he doesn't plan on ever doing that again,
00:12:31even if a song raises its hand like this one did,
00:12:33because he was saying,
00:12:36I haven't seen a dollar in return from radio stations for the promotion that we put into it.
00:12:43And of course, that artist is, or not of course,
00:12:46but this artist in this situation was also the songwriter.
00:12:49So she's been being paid as the songwriter.
00:12:51But on the artist side, on the record label side,
00:12:54they haven't seen any money,
00:12:56although they put up the marketing costs, I guess.
00:12:59And I thought that was a really interesting way to look at it.
00:13:01And to hear that he was thinking about never doing a radio campaign again was fascinating to me.
00:13:07It is interesting.
00:13:07And, you know, radio used to be much more promotional,
00:13:12I would argue, than it is today.
00:13:13Back in the 60s and 70s, you know, Wolfman Jack and that P word that you mentioned earlier.
00:13:19You know, radio is how you got out there.
00:13:22Connections with radio and contacts at radio were important, getting on playlists.
00:13:27At one point of just individual influential DJs, as radio consolidated,
00:13:31it became more of getting on corporate playlists as they, you know, feed it out to their affiliates.
00:13:36I would argue today, radio is, you know, much more of a follower than a leader.
00:13:41If you look at many of the big hits, they break on TikTok, they break on other digital channels,
00:13:47they break on Spotify or SiriusXM.
00:13:49You know, there's some great country acts and elsewhere that have broken on SiriusXM first.
00:13:53And then FM radio watches the data, watches the traffic, sees the spikes, and then hops on.
00:13:59So, again, radio is an important part of the ecosystem.
00:14:02I don't want to deny that.
00:14:03But I think it is much less of a leader than a follower on what breaks nowadays.
00:14:09Yeah, that's interesting.
00:14:10It kind of feels like it's the final destination for a hit.
00:14:13It's like the pinnacle of how big a hit could get is if it gets on to top 40 radio.
00:14:20But, yeah, it's not the thing that I think of when I'm looking to find new music anymore.
00:14:24I think of radio as like the moment when something reaches true ubiquity.
00:14:27It's like that's when my mom knows about it.
00:14:29That's when my cousin knows about it.
00:14:31That's when my teacher knows about it.
00:14:32It's like that's where everyone is aware of the song.
00:14:37But what's interesting to me about radio is I imagine there are some songs that are, I don't know, more.
00:14:43They just like fare better on radio than others.
00:14:47Are there some specifications that radio stations are still looking for?
00:14:51Like is the three minute, 30 second duration still important to radio stations?
00:14:57Obviously, language, I imagine, is still important to radio stations.
00:15:00Can you tell me anything about that?
00:15:03Yeah, I mean, they definitely, you know, they obviously are still worried about the timing.
00:15:06In fact, the more music they can cram into an hour, you know, just it's more efficient.
00:15:13Shorter songs are a little bit better.
00:15:14In fact, another thing that people don't know, you know, have you noticed they don't do announcements?
00:15:19They don't pre-announce songs typically on radio anymore.
00:15:21They used to do that back in the day.
00:15:25They would announce every song on the artist, and that's less and less common on FM radio.
00:15:29And part of that is because, you know, if you strip out the announcement for 12 recordings in an hour, that's enough for an ad spot or two.
00:15:38So, you know, there's – and getting back to the promotional impact, well, if you want to try to promote a song, it's a lot better to announce the song and pre-announce the song and who the artist is and name.
00:15:47So, I think they still try to look for ways to get as much music, and it's funny.
00:15:52You mentioned the three minutes or three minutes, 30 seconds.
00:15:54I have a friend of mine who used to manage a very well-known artist who I wore, May Nameless, and she had a great hit, but it was like four minutes and ten seconds.
00:16:03So, they literally, on the liner notes, I think they listed it as three minutes and 70 seconds so they could try to sneak in and they actually got on radio.
00:16:12Whatever works, you know?
00:16:14Yeah.
00:16:15That's funny.
00:16:16But it's very – yeah, the promotional thing is very interesting, and even back when they were promotional.
00:16:21So, I will readily admit that it was – radio was far more promotional back in the 60s and 70s and 80s, you know, before we had streaming.
00:16:30But even then, I don't think it justifies not paying the artists anything, right?
00:16:37I mean, if you wrote a book – maybe you have written a book, and if so, I promise to read it.
00:16:43Don't worry.
00:16:44You're not on the hook for a book right now.
00:16:45When I do write a book, though, someday, I'm going to send it to you and be like, remember that one time that you said you were going to read my book?
00:16:50Fair enough.
00:16:51Fair enough.
00:16:51I have a book, but it's a case book for law school, so I don't know if it would be that exciting.
00:16:54I'm going to pass.
00:16:55I'll send you a copy just in case.
00:16:57Okay, great.
00:16:57Just have it up on your shelf.
00:16:58Great.
00:16:59I'm a recovering lawyer, and I actually teach a class in music law at Georgetown.
00:17:03Oh, wow.
00:17:04But it's a case –
00:17:04Wait.
00:17:04How do you have time for that?
00:17:06It's an excellent question.
00:17:07Sleep.
00:17:08Sleep is overrated.
00:17:09Okay.
00:17:09Okay, fair.
00:17:10Well, thank you for being with us today then.
00:17:12But even if it is commercial, let's say you wrote a book and I made a movie of your book.
00:17:18Nobody would question for a minute – I mean I'm obviously promoting your book.
00:17:22A million more people are going to buy your book unless my movie totally sucks, right?
00:17:27You're going to sell a million more books, but nobody would question that I should license that from you and pay you a royalty.
00:17:33Or if you owned a baseball team, right, and I wanted to put them on local radio, I'm obviously promoting the team when they're on local radio.
00:17:41People are going to sell more merch.
00:17:43They can probably sell more tickets.
00:17:45It will drive up the advertising dollars.
00:17:47But nobody for a second would question that radio has got to license that content from Major League Baseball because just because something is promotional, that works into the pricing, right?
00:17:58But radio is the only platform that I can think of where this vague promotional excuse, which I'm not even sure is that relevant anymore, has been used for decades as an excuse to essentially take someone's property wholesale and use it without their permission.
00:18:15And that's why even if it is promotional, that doesn't get to justify what Raid has been doing for decades.
00:18:25Now, again, I don't blame them for trying to minimize their costs, right?
00:18:28I mean you don't expect most commercial entities, especially shareholders, to voluntarily pay things they don't have to.
00:18:34But it's not the right thing to do.
00:18:36Yeah.
00:18:36So how was the system even set up this way in the first place?
00:18:39Like was there a time when artists were going to get paid like back in the 30s and then something happened?
00:18:45Like how did this play out this way?
00:18:47So and why is it – and especially why is it true in the U.S. and other places?
00:18:51Yes.
00:18:52So I kind of describe it as sort of a victim of history and politics.
00:18:57That's how I think about it because –
00:18:58A lot of things are victims of that.
00:18:59They are.
00:19:00A lot of – revolves around when there are big copyright revisions to the Copyright Act, you know, copyright law in this country.
00:19:05That drives all of this.
00:19:06And, you know, there was a – there was one big revision in 1909 and the next one didn't come along until the 70s.
00:19:13So in 1909, think about it.
00:19:16There were songwriters because they've been around for, I don't know, 2,000 years.
00:19:20Always.
00:19:21So the songwriters had a seat at the table and when they did this revision, you know, they tweaked some things to the benefit of songwriters.
00:19:26Again, not saying that songwriters are paid fairly because they're – I think they should be making more too.
00:19:31But there was no record industry.
00:19:33You know, that didn't really come along until the 30s.
00:19:36You know, the phonogram had been invented, but –
00:19:39It didn't sound very good.
00:19:40It didn't sound very good.
00:19:41Not very commercially viable yet.
00:19:42You know, your master's voice was still far away.
00:19:45And then fast forward to the 70s when the next revision happened.
00:19:50Well, by then, the broadcasters had been created.
00:19:53You had all these spike in radio stations everywhere.
00:19:55The National Association of Broadcasters was formed in 1920.
00:20:00So the next time for a shot at it, now you had very powerful broadcasters.
00:20:04There's not a single congressman or woman or a single senator – well, congressman or woman who doesn't need their radio station every two years, right, for an election.
00:20:11But basically by the time the next revision rolled around, the broadcasters were just too powerful, and they've been able to stop it somewhat.
00:20:21And we'll get to a little bit that the recording industry was able to get in the 90s.
00:20:26So it's sort of the politics of the situation.
00:20:29I think a lot of the arguments they used to justify not paying melt away with just even the slightest bit of heat that you apply to them, the promotion argument, or it's going to hurt local radio.
00:20:43In fact, the things we want to do, help – Sound Change wants to do is – are going to help local radio.
00:20:47Or they, you know, they can't afford to pay it.
00:20:50Well, they pay their on-air talent, you know.
00:20:52They pay the advertisers – the advertisers pay them, but they pay, you know, the people that get the advertising into the shop.
00:20:58Yeah.
00:20:59I mean, that was going to be – that was going to be my follow-up of trying to poke a hole in this.
00:21:02Like, is there some way that, like, this could hurt radio stations and thus hurt artists in the future if you push too hard on getting the rates, you know, moved?
00:21:12I mean, obviously there's no rate at all right now, but getting a rate or moving up the songwriter rate, is there a potential that it puts radio stations in jeopardy and thus eliminates that as an income stream?
00:21:24Well, you know, the way – I would say no because the way this would happen if it were to happen – so we've been fighting for many years as Sound Exchange to try and get FM Radio to pay the recording artists.
00:21:39And we're part of a great coalition called the Music First Coalition, which is a broad array in the industry.
00:21:44It includes, you know, major record labels, indie record labels, the unions, artist groups, the producers or, you know, studio producers are in support of it because a lot – much of their income is derivative of the artist's income.
00:21:57So we've been fighting for it for 10 years.
00:21:58And by the way, the industry has been fighting for it for much longer.
00:22:02There's a letter that was issued by Frank Sinatra – I don't remember exactly when, but, you know, in the – maybe the 19 – probably 30 years ago.
00:22:15Okay.
00:22:16I think the one – the copy I've seen is a letter from him to Bruce Springsteen.
00:22:20Oh, my God.
00:22:21About this fight, you know?
00:22:23Wow.
00:22:23Because think about Frank Sinatra.
00:22:25Yeah, he doesn't write –
00:22:26Didn't write a lot of his songs.
00:22:27I mean, a lot of artists didn't until, like, you know, post-Beatles.
00:22:31So, I mean, there are probably a lot of artists in that same situation.
00:22:33It all depends on the genre.
00:22:34You know, songwriting is a bigger craft and a more prevalent craft in some genres than others.
00:22:39Yeah.
00:22:41So back to your original question, there wasn't enough of a recording industry in 1909 to change the laws.
00:22:48And then by the time the Copyright Act was revised, the broadcasters were very powerful and have been able to stop it.
00:22:55And, you know, it sort of became an accepted part of how it is in the U.S.
00:23:00It's great.
00:23:01When you talk to – it's not great.
00:23:03It's amusing or a bit concerning.
00:23:06When you talk to, you know, classic rock acts or older artists, it's all they've ever known.
00:23:13Yeah.
00:23:13Because in the U.S., we've never had what we call neighboring rights.
00:23:16That's – you probably hear the term neighboring rights, which is – I've heard it described a million different ways.
00:23:22I think of just basically the performance of a sound recording, right?
00:23:25Yeah.
00:23:25So when people think about copyrights, they usually are thinking about songs, you know, notes and lyrics and songwriters.
00:23:32And when you think about, like, performance of that, that's what ASCAP and BMI and CSAC do and GMR.
00:23:39And when you think of performing a sound recording, those are neighboring rights.
00:23:42So we don't have those in this country.
00:23:44In fact, a lot of older musicians probably don't even know that term.
00:23:48But around the rest of the world, everyone gets paid.
00:23:51Yeah.
00:23:52And so how did this start developing in other countries?
00:23:56Because I imagine they also had the same situation where the copyright protections that were devised in that country probably happened before recorded sound was a big thing.
00:24:05When did they start amending – I mean, that's actually a huge question.
00:24:09I don't know if there's, like, an EU.
00:24:12It's a great question and a hard question.
00:24:14I don't think there's a simple answer.
00:24:15You know, each territory is different.
00:24:17Each country is different.
00:24:19It is definitely the case that, you know, certain countries, the unions are stronger and have, you know – I mean, we have great unions in this country.
00:24:26They're both on our board.
00:24:28But, you know, there's just more of a union history like in France.
00:24:32You know, some of the first unions were probably created in France.
00:24:35Or it might be the timing of just other interest groups was different.
00:24:40And the U.S. is also a little bit different.
00:24:42It's a very property rights-driven culture.
00:24:46You know, capitalist America, which is great most of the time.
00:24:52It's like, are we going to devolve into a question about whether or not capitalism should exist?
00:24:56We'll have to be there for a long time.
00:24:58By the way, that would be – that would also be a very interesting discussion.
00:25:01No, capitalism is – look, the U.S. is the biggest market and, you know, a lot of the success and the power of this country are no doubt due to the capitalist drive.
00:25:10Whereas in other countries, there are other forces, you know, maybe cultural things occupy a different status.
00:25:19Yeah.
00:25:19Here's how I love –
00:25:19France is a good example.
00:25:20Here's how I love to sum it up.
00:25:21In the rest of the world, in a lot of the European countries or elsewhere, the music industry issues are overseen by, you know, the Ministry of Culture or the Ministry of Industry – Minister of Industry or whatever it may be.
00:25:33In the U.S., you know who they're overseen by?
00:25:37Register of Copyrights?
00:25:38The U.S. Department of Justice.
00:25:40Oh.
00:25:40And that sort of tells you a little bit about just the relative importance of different things.
00:25:45You know, the DOJ looking at things often from an anti-competitive angle and from an antitrust angle.
00:25:52We don't really have a minister of culture, right, like they do in many European countries.
00:25:57Yeah.
00:25:57So I just think music just occupies a different space in their culture.
00:26:01Not to say that music isn't hugely important in the U.S.
00:26:04It's just – you know, it's just a different mindset.
00:26:06Yeah.
00:26:06That's interesting.
00:26:07Okay, well, we haven't gotten into exactly what SoundExchange does and how it was established, so let's go there next.
00:26:14Tell me about the formation of SoundExchange in the 90s, correct?
00:26:18Well, we first started doing what we do in the 90s.
00:26:20Our current iteration was 2003.
00:26:222003.
00:26:22We were basically created by the music industry, and the main thing that we did then and do now is collect digital royalties for non-interactive streaming.
00:26:31So think about radio-like digital services, Sirius XM, iHeart Online, not over FM, as we just talked about, you know, your cable TV.
00:26:41It was in the 90s where the music industry finally got some of this performance right for sound recordings.
00:26:46You know, we had nothing prior to 1995, and so in 95, a law was passed that finally gave the recording industry the right to get some royalties when they're digital – only their digital – when their recordings were streamed digitally.
00:27:01And if it's a non-interactive stream like Sirius XM where, you know, it's fed to you, you can't build a playlist, they can, if they so choose, file a piece of paper to the Copyright Office and then just use SoundExchange.
00:27:15So Sirius XM, for instance, does not have to go and license every sound recording ever created.
00:27:20They have access to it under federal law as long as they pay SoundExchange and send us the data, and that's the bulk of what we do, and it's grown.
00:27:28You know, when I first started working on this stuff, I think we were paying out $25 million a year, and now we regularly pay out over a billion dollars a year.
00:27:37Wow.
00:27:38Okay.
00:27:38And, you know, we're 12% to 14%, somewhere around there, of U.S. recorded music industry revenue.
00:27:46So that's the bulk of what we do and what we're known for.
00:27:49We do other things too.
00:27:51We do administer some direct licenses that are out there.
00:27:53So a record label might do a deal with a service, and we may administer some or all of that deal on the back end.
00:28:00And we also do a lot to make the industry work better.
00:28:02One of the things that's so frustrating is there's so much friction in this industry.
00:28:06When you think about, you know, how you license, if you want to license music, how the money flows, all the places you have to go, the data issues that stop the money from going where it needs to.
00:28:18Or, you know, it's very frustrating, and there's a lot of waste.
00:28:21So we do a lot of things to try and remove that friction in the industry by working, you know, working on standards bodies about delivery of data and working on the data that underlies a lot of this.
00:28:34It's not the sexy part of the industry.
00:28:35Yeah, I was going to say, like, there's probably going to be some people listening who are on the newer side to the music industry and might not really realize what a big difficulty it is to make sure that everyone is getting paid properly due to the fact that a lot of times when people release their music, they don't properly put, they don't check all the right boxes.
00:28:54They're not properly spelling the artist's name and every single songwriter's name and entering who owns what.
00:28:59And so it becomes very, very complicated, and it is a very important thing in the music industry, but it might not be something that a brand-new artist who might be listening to this podcast would know anything about, but it will enter your life at some point.
00:29:11I'm pretty sure people don't join bands with the primary reason of having their metadata correct on some database somewhere.
00:29:18And you're right.
00:29:19And to be honest, we want artists and songwriters and producers, all the people that help create the music, I think we'd all be better off if they can spend more of their time practicing their craft and focus on the music.
00:29:33In fact, it's not an official tagline, but, you know, we talk about, you know, there's a saying we sometimes talk about at SoundExchange, you focus on the music, we'll take care of the noise.
00:29:46Oh, that's good.
00:29:47Did you come up with that?
00:29:48I wish I had, but I did not.
00:29:50This episode is brought to you by SoundExchange.
00:29:53Since 2003, SoundExchange has distributed more than $12 billion in royalties to a community of more than 800,000 recording artists and sound recording rights owners.
00:30:03SoundExchange makes it easy to collect the digital performance royalties you earn whenever your music is played in the U.S. and all available royalties abroad.
00:30:11With a growing portfolio of agreements with partner collective management organizations covering 90% of the available global market,
00:30:18SoundExchange streamlines the complex administrative burden of international collections for nearly half a million artists and rights owners.
00:30:26Ready to register and find out more?
00:30:28Visit SoundExchange.com to get started.
00:30:30And going back to kind of around the time that SoundExchange was formed, obviously the recorded music industry had grown up by that point in the 90s and digital was on its way.
00:30:41And so I imagine the reason why all of these things kind of started popping up is because of digital, right?
00:30:48Like they saw on the horizon that there were going to be these new technologies for delivering radio to people.
00:30:53And maybe that was an in.
00:30:55Was it easier for them to fight for what was happening in the near future than what was happening in the past?
00:31:00Was that like a conscious effort by the music industry?
00:31:02That's remarkably insightful.
00:31:04Seriously.
00:31:04Like that is exactly.
00:31:06So, you know, I mentioned this multi-decade fight that the recording industry has had with the FM industry to try to get radio to pay.
00:31:15And in 1995, we finally got a digital right.
00:31:18And the reality, I would tell you, of why that happened is just politically that's what we were able to get through as an industry.
00:31:25But if you were to discern the intent of Congress and why did they give us just a digital right and not apply it to FM, the answer you would get is because exactly what you said.
00:31:40They saw the digital future.
00:31:42Napster was starting to kick around.
00:31:44I mean, maybe Napster.
00:31:45I guess the Napster really came onto the scene a couple of years after that.
00:31:48But, you know, and Congress's justification for why only digital was, wow, this could be a piracy problem.
00:31:56You know, FM radio back then, not so much, you know, but they saw the ability of what digital could mean for piracy.
00:32:06You know, one thing about analog piracy, you know, when you go from tape to tape to tape to tape, it degrades.
00:32:12It's a much more labor-intensive and capital-intensive project with digital, with the push of a button, you can create a million perfect copies.
00:32:20And by the way, take one of those and push a button, and you can create a million more perfect copies.
00:32:25So digital obviously had a lot of potential for the industry, but it also had the potential for, you know, piracy and theft.
00:32:35And that was the ostensible justification of why Congress gave us this limited digital right.
00:32:41One of the interesting things I always come back to on the show, if you've listened to most of the episodes, I've come back to this like probably three or four times,
00:32:49is that the primary or popular methods of consumption really do drive the kind of music that is made in the industry at that time.
00:32:58So for a while, radio was so dominant and so important for the music promotion process that, yeah, you did want to make a song that was three minutes, 30 seconds, cleanly fit into a radio format.
00:33:08I did this really interesting cover story on the artist Levy.
00:33:12Are you familiar with Levy?
00:33:14Not completely. I've heard that.
00:33:15Okay. Yeah, yeah, yeah.
00:33:16So she has like kind of a jazz pop blend to her music.
00:33:20And I did this cover story where I interviewed some of the people on her team about why she's become so successful now.
00:33:27And a lot of them were talking about how right now is a really interesting time for artists that don't fit cleanly within a certain genre.
00:33:37And I think, you know, historically, terrestrial radio, you had your few different formats that you could fit into.
00:33:42And Levy is not one of those people, like realistically, it would have been really hard for her to fit into one of those formats as someone who's blending jazz and pop, almost like a Nora Jones style kind of stuff.
00:33:54And they were saying that they're really grateful that she came up in a time of streaming.
00:33:58And that was a time that really allowed her to just be herself and not have to conform to any of that.
00:34:03But I feel like radio is getting more niche.
00:34:07With SiriusXM, I was exploring some SiriusXM stations in preparation for this interview because I haven't been on in a minute.
00:34:14I was listening to John Mayer's artist, you know, centered radio station, the Beatles radio station.
00:34:20What are your normal SiriusXM presets?
00:34:23Okay, so I don't have SiriusXM, but my mom does.
00:34:26I'm sorry, what?
00:34:27I know.
00:34:29I'm sorry.
00:34:30You must not have a car.
00:34:31Well, I am in the car a lot.
00:34:32I'm kidding.
00:34:33I'm listening to my own podcast, you know.
00:34:35Of course, that's true.
00:34:36Podcasts are...
00:34:38It's basically talk radio.
00:34:40Yeah.
00:34:402.0, to be quite honest.
00:34:42I'm no different from...
00:34:43Talk radio with optionality.
00:34:45You can listen to it when you want.
00:34:46Yes.
00:34:47Yeah, yeah.
00:34:48But I was in my mom's car just home for Thanksgiving and I was scrolling through all the channels
00:34:52and I was shocked by just how many niches that they offer now.
00:34:57I'm wondering, do you think that that offers more opportunities for artists who are kind of
00:35:02not more traditional genre-specific artists?
00:35:06Absolutely.
00:35:07Again, you were spot on.
00:35:09You know, the old radio formats were very limited and remember when, you know, such a
00:35:13big story of someone crossed over, right, from country to pop or from, you know, or from,
00:35:18you know, gospel to country or whatever it may be.
00:35:20That was this big, big thing.
00:35:21And that's, like, artists don't fit into neat little tiny boxes.
00:35:26They never have.
00:35:27And they sure as heck don't want to be fit into neat tiny boxes.
00:35:31So I agree with you that you kind of needed that to get on radio historically because they
00:35:39need to know where to place you.
00:35:40You don't need that on any of these other platforms.
00:35:41You know, another interesting thing is you got to get people quicker because if you don't
00:35:48have something that, you know, hook early on or, I mean, sometimes if people don't like
00:35:53the first 10 seconds of a song, there's a lot more incentive to switch around because
00:35:58there's so many options.
00:36:00So I think artists, you know, short-form video is, that's much shorter than a, you know,
00:36:05four-minute song or three-and-a-half-minute song is up and coming.
00:36:08And I think there's good and bad to that.
00:36:09You know, we could talk about that.
00:36:12It's just an observation.
00:36:14Short-form, quicker hits, and not having to fit into a defined, predefined genre.
00:36:20You know, genre is a tricky thing because even genres, what genre something is or how
00:36:27many genres there are is a subjective assessment.
00:36:32Some people think in terms of, you know, five or six or eight radio formats.
00:36:36Other people think in terms of 15 genres, but you could probably find some place that
00:36:39has 150 genres because to try to cover all the differences.
00:36:45Yeah.
00:36:45So you were just talking about how there are so many options now.
00:36:49So you have to hook listeners really quickly.
00:36:51One thing that I have noticed in kind of looking over like media-based charts and trying to
00:36:56kind of examine where radio is at right now, it feels like radio stations, from my vantage
00:37:01point, are getting more and more safe with the choices that they make of what they put
00:37:05on the radio.
00:37:06It feels like the top 10 songs are just played over and over and over again.
00:37:11And especially if you look at like comparing number one to number 10, that number one song
00:37:15gets played all the time.
00:37:17And I imagine it wasn't always that way.
00:37:20When did you start seeing a shift where there was more kind of consolidation of like the
00:37:25tracks that were being played on radio?
00:37:28Well, if you mean when did SoundExchange start seeing it, we've never had that because the
00:37:34interesting thing about SoundExchange, we have, you know, 3,500 services that report to us
00:37:38every month.
00:37:40And the beauty of the internet among many things is you don't have limited real estate, right?
00:37:44So if you live in a city and you want to get on an FM station, there's only so much bandwidth
00:37:49that the FCC has, you know, said can be for the music, commercial music radio station.
00:37:55And there's a limited number of slots and they're often owned by big corporate radio giants.
00:37:59And it's really hard to get into those.
00:38:01You don't have that real estate limitation on the internet.
00:38:04So if you're in New York and you want to listen to, I don't know, you know, Zydeco.
00:38:09There's probably not a Zydeco station in New York City.
00:38:12But guess what?
00:38:13You can listen to it now online.
00:38:15So we've never, you know, SoundExchange, we've always had a huge variety.
00:38:20But, you know, you are right.
00:38:23There is, at least my observation is there is less variety.
00:38:28And I think part of that is due to radio consolidation.
00:38:30You know, back in the days of where DJs were permitted to sort of make their own decisions
00:38:36and, you know, you would go literally from DJ to DJ.
00:38:40You know, if you've seen some of the movies about the record industry in the 50s and 60s,
00:38:43they would go DJ to DJ to DJ to DJ.
00:38:45Well, that's not really possible anymore because very few DJs have that type of discretion.
00:38:50More and more programming is coming out of, you know, the central server of a big radio conglomerate
00:38:56and fed out to their affiliates.
00:38:58And I think that naturally leads to less variety over the air.
00:39:03Yeah.
00:39:03This is a bummer, by the way.
00:39:05Yeah.
00:39:05Yeah.
00:39:05I mean, is it becoming more data-driven, just like everything else, where they're looking at
00:39:09the stats of like, okay, people tend to stay on the radio station if we play this
00:39:13song, we're going to keep playing this one.
00:39:14I think so.
00:39:15Yeah.
00:39:15I don't have any direct evidence of it, but how can it not be?
00:39:17I mean, the whole world's more data-driven now.
00:39:20Definitely.
00:39:20And at the end of the day, you know, most of these, especially these big commercial,
00:39:24you know, the iHearts of the world, they're driven to maximize profits, you know.
00:39:30And so I can't imagine that they're not looking at that type of data.
00:39:34Yeah.
00:39:34And when did radio consolidation start to come about?
00:39:37Because you've been referring to that a few times, but I don't exactly know when it went
00:39:41from radio stations being quite local to being something that is more of a national network.
00:39:45Yeah.
00:39:46Well, I'll tell you, there was a telecommunications bill, I think it was 1996, that lifted a lot
00:39:51of the ownership caps.
00:39:52So historically, for public policy reasons, there were limits on how many radio stations
00:39:58you could own in a single market or how many stations and newspapers, you know, thinking
00:40:02that they didn't, they wanted to make sure there was a variety of sources for people to
00:40:06get music, to get their information, to get their news.
00:40:10So for public policy reasons, the FCC and others have always had limits on how much.
00:40:17And in 1996, they lifted those limits to allow greater consolidation.
00:40:21And it's a fight that's still happening.
00:40:22And if you look at some of the National Association of Broadcasters, the NAB, some of their higher
00:40:28priorities right now on the radio side is to try and achieve even more consolidation.
00:40:34Or, you know, there are also limits, and I forget the term, but there's limits on overlapping
00:40:39programming, right?
00:40:40So how much of the same programming you can play in different DMAs, you know, radio markets
00:40:46that overlap.
00:40:47Um, and there are limits on that as well, again, to try to foster variety and diversity
00:40:51and, you know, allow more music to get on the air.
00:40:53And I think the NAB is also, um, trying to, uh, to loosen that so they can do more consolidation
00:41:02there as well.
00:41:03And they would probably say if they were in this chair, they're being forced to do that
00:41:07because of the, you know, the industry.
00:41:09And there's all these other competing platforms and for commercial reasons, you know, uh, it's
00:41:14in their commercial interest to try to allow more consolidation so they can compete better
00:41:17with the online platforms and things like that.
00:41:19So I suspect that would be what they would say if they were sitting here.
00:41:22Yeah.
00:41:22I don't know if you caught this article, but there is a really interesting story in Rolling
00:41:26Stone.
00:41:27Um, I think it was a couple months ago where, um, it was basically profiling this radio station
00:41:33in Iowa.
00:41:34It was a heavy, like hard rock station.
00:41:36And they were giving some of their overnight shift slots to an AI radio personality.
00:41:42Yeah.
00:41:43Uh, it was a, it was a, it was this, um, AI radio personality called DJ Tori and they
00:41:49even made an image for her, which I don't even think you need for radio, but they did
00:41:52it anyway.
00:41:53Um, where she has like tattoo sleeves and piercings, like trying to make her look like
00:41:57a rocker, like DJ person.
00:42:00Um, and I, I have to admit, I read that article and I thought long and hard about it and I was
00:42:04like, okay, you know, is this going to be something that we see more and more as these smaller
00:42:11market radio stations struggle, um, or increasingly find it difficult to fill these slots.
00:42:18I'm wondering from your vantage point, what do you think?
00:42:21Do you think that this will be a growing trend of people trying to cut costs by automating
00:42:25out radio personalities?
00:42:27Um, I think there's definitely a risk of it.
00:42:29Uh, and I don't say that with any, you know, zeal.
00:42:32Um, I think that's not great for radio.
00:42:34It's not great for the industry.
00:42:35It's not great for American culture.
00:42:37But again, when you think that some of these big conglomerates are driven, you know, to
00:42:41maximize profit, cut costs.
00:42:43And again, I'm not saying that's a bad thing, but if they're able to swap out human beings,
00:42:48you know, this is happening in every industry, right?
00:42:50It's not just radio.
00:42:51It's, can robots, you know, build things at Amazon, right?
00:42:55Um, or, uh, you know, I, I used, I use Waymo when I'm out here in LA.
00:43:01We didn't need a driver.
00:43:01It's a crazy experience.
00:43:03It is.
00:43:03I just tried it.
00:43:04It is an interesting experience.
00:43:05Um, so I do think that's a danger.
00:43:07And, you know, that's, um, that's not a great thing, especially because, especially
00:43:13if there's a danger of them, you know, mimicking existing talent.
00:43:18In fact, that's one area, uh, you know, the broadcasters and the, and sound exchange,
00:43:24one area that we agree on, uh, as does most of the industry.
00:43:27Um, there's a bill in Congress being pushed right now called the No Fakes Act to try to
00:43:31minimize or prevent the ability to take someone's name, image, likeness, voice.
00:43:38And I mean, you know, really popular DJs should are on that list and have an interest as well.
00:43:42We share the desire to protect the human creativity.
00:43:46AI is a complex issue, which we can talk about for another hour, I'm sure.
00:43:50And, you know, it's got some interesting things it brings to the industry, but the threat it
00:43:54brings of usurping real human creativity is a real one that I think we need to, we need
00:43:59to work against.
00:43:59Everybody needs to work against it and, and preserve American culture, American craft,
00:44:04American music.
00:44:06Um, you know, at some point, if all you have is a bunch of, of machines, just regurgitating
00:44:11variations of all the stuff that's already been created, is that really a world we want
00:44:14to be in?
00:44:15I don't think so.
00:44:15Yeah.
00:44:16Yeah.
00:44:16Yeah.
00:44:16And an interesting story that I just wrote about was, um, I heart radio, um, just announced
00:44:22that they have this new program called guaranteed human.
00:44:25And basically they're going to be plugging this on their radio stations and reminding
00:44:30people that this is part of their policy.
00:44:31But basically the policy is that they will not play AI songs.
00:44:36They will not have AI radio personalities, and they will also not, um, allow for any AI podcasts
00:44:41within their network.
00:44:43Um, this is really the first company that I've seen.
00:44:45I mean, just take a hard no stance against AI.
00:44:49I think there's a lot of music companies right now that are kind of like, if it's responsible,
00:44:53then like, maybe we could do it.
00:44:55But I heart really came out and put, you know, a flag in the ground, said what they wanted
00:44:59to say.
00:45:00They say, we're not playing any AI songs.
00:45:02Um, I'm wondering, do you think that that can stand as AI continues to develop and we start
00:45:08to get more and more AI songs?
00:45:10I'm sure some of them will climb the charts.
00:45:12We already are seeing the start of that.
00:45:13Um, do you think that this is a policy that they can maintain as the future progresses
00:45:18with AI?
00:45:18It's a great question.
00:45:19And I think, um, and good for them for doing that.
00:45:22You know, again, we, we have our differences with I heart, but we also have many things
00:45:25we agree on.
00:45:25You know, we are, um, you know, there's the symbiotic relationship between radio and the
00:45:30industry, uh, in some ways.
00:45:31And then in other ways we're like competing cousins, but, um, I think it could stand, you
00:45:38know, one of the things I've, I've think about sometimes is think about consumer decisions
00:45:44that have been made on, you know, ostensibly ethical grounds.
00:45:47For instance, uh, no blood diamonds or blood-free diamonds, you know, or, um, uh, coffee that
00:45:54comes from, you know, a certain area because it's, it's raised more ethically, or I don't
00:45:58want my genes manufactured by children in, in a faraway country at, you know, at slave
00:46:03labor rates.
00:46:04Imagine a world where human only is something a consumer makes an election to do.
00:46:12You know, I don't want AI music.
00:46:14I want human music.
00:46:15And that could be a differentiating factor for some of the products four years from now.
00:46:19Um, I don't think AI is going to disappear.
00:46:23I mean, AI is here and I do think there will be AI creations.
00:46:26And as I said, there are very interesting things that I can do, you know, like, um, there's
00:46:31a K-pop band a couple, couple of years ago who, you know, dropped on the same
00:46:34day, a record in six different languages.
00:46:36Oh, yes.
00:46:37Manat, I believe.
00:46:38Manat, yeah.
00:46:39Midnat?
00:46:40Maybe it's Midnat.
00:46:41I don't know.
00:46:41Sorry, maybe it's Midnat.
00:46:42I don't know.
00:46:43Um, it's kind of a made up word, but I think, yeah.
00:46:45You know, that's really cool.
00:46:46So, M-I-D-N-A-T-T.
00:46:47Or Randy Travis, you know, um, Randy Travis, a great friend of the industry, had a stroke 12
00:46:52years ago, can't sing anymore.
00:46:53He released his, you know, his, a new, a new record last year because of AI.
00:46:57So there's some really cool things they can do, but, but, you know, we've got to make
00:47:02sure that AI doesn't display the role for, for human creators.
00:47:06Yeah, I, I agree.
00:47:08I, so I posted about this new iHeart plan on Instagram and I always get a lot of comments
00:47:15whenever I talk about AI on social media and people were overwhelmingly very excited.
00:47:20I don't know if I just hit a certain corner of the internet with that post or not, but
00:47:24people seemed really excited by this idea to do the Guaranteed Human program and to certify
00:47:28that all the music that was going to be played on iHeart and all the radio personalities
00:47:32and all the podcasts were going to be Guaranteed Human.
00:47:35Um, I think the interesting thing for, for me is, um, Deezer recently released some numbers
00:47:41saying that 97% of people can't tell the difference between AI music and human made music.
00:47:49And I mean, I hope that iHeart's detection tool is really strong and can differentiate if
00:47:55they're trying to enforce this policy.
00:47:57They said that that's how they're going to do it.
00:47:58They're going to screen songs, put it through an AI detection tool that they have.
00:48:03I'm not sure which one, but, um, that will be the way that they determine whether or not
00:48:08something can be played.
00:48:09And the, but the fact that we're already at a place where 97% of people can't tell just
00:48:13by listening is crazy to me.
00:48:17It is crazy.
00:48:17And, you know, you may be right, um, that nine, I mean, I think you are right that, that,
00:48:21and it's, and it's only going to get worse by the way.
00:48:23I mean, as that gets better, but back to my, you know, my, my example, you can't look
00:48:29at a diamond and know, did it come from a war region?
00:48:31You can't necessarily look at genes and know where they, where they built by, you know,
00:48:35children in horrible factory conditions.
00:48:36So maybe one of the things we need to think about as an industry, and by the way, this
00:48:41isn't just music is requiring AI companies, requiring people to put AI content, to identify
00:48:46it, to label it.
00:48:47You know, maybe if you're pushing AI out and not being clear that it's AI, maybe that should
00:48:52be considered an unfair trade practice or somehow deceptive.
00:48:56You know, part of what's being talked about in Congress as well are not just the, you know,
00:49:00the No Fakes Act and the name, image, likeness, voice, but labeling issues, detection issues,
00:49:06you know, should, should the AI companies be required to embed in their products something
00:49:11that a, that a sniffer or a, some other, you know, some other detection mechanism can
00:49:16pick up.
00:49:17I think it's true that, you know, they can detect a lot of AI work now.
00:49:21It's an open question about as AI gets better and better, are they, you know, 10 years from
00:49:25now, is it going to be, it's going to be a lot harder to detect what is AI.
00:49:28So I think disclosure, metadata, labeling, you know, being open about what's AI and what's
00:49:35not is something we should think about as an industry.
00:49:38Yeah.
00:49:38I mean, already I'm starting to, well, I'm starting to talk to some of these AI detection
00:49:43tools and sometimes I'll send them songs that I'm like, it sounds like AI to me, but
00:49:47also I never want to accuse someone of using AI without fully vetting and making sure.
00:49:51And some of these tools are having a hard time, like giving me a clear answer.
00:49:56They're like 70% sure that this is AI.
00:49:58I'm like, well, that's not good enough.
00:49:59I can't, I can't just go on with that.
00:50:01And what does AI mean?
00:50:02I mean, if you talk to, like when you go to South by and you talk to the brand new artist
00:50:07up and coming, to them, AI is just another tool.
00:50:09It's no different than, you know, any other tool they use.
00:50:12And I think even the industry and certain U.S. copyright law, like if you use some AI
00:50:16to help create something, but at the end of the day, it's kind of a human made product,
00:50:21that's a very different thing than something that's spit out of a machine based on nothing
00:50:25but code with no human input.
00:50:27So even, you know, when we talk about AI music, where's that line?
00:50:33Where does, where does the human created thing become an AI thing that we would consider not
00:50:38human?
00:50:38That line is yet to be drawn.
00:50:41Yeah.
00:50:41So I'm wondering with SoundExchange, I imagine there's not too many cases where in, quote
00:50:46unquote, AI artist or an AI song would be generating a ton of royalties with SoundExchange quite
00:50:52yet.
00:50:52But do you guys have any policy about a song that you know is 100% generated by an AI model?
00:50:58Are you still paying out on those songs?
00:51:00So great question.
00:51:02First of all, we don't get a ton of them because if you think about it, if you're a streaming
00:51:06service that has to pay royalties to SoundExchange or anybody else, and if you had, and you're
00:51:10in the U.S. and it is a 100% generative AI creation, under U.S. law, that's not copyrightable.
00:51:18You can't copyright.
00:51:19And if it's not copyrightable, then it probably doesn't need to have a royalty.
00:51:23And if it doesn't need to have a royalty, why would they report it to us?
00:51:26So if they're able to scrape it out and decrease their royalty load, in fact, that's a dirty
00:51:31little danger I worry about as well.
00:51:33Are a lot of the big platforms who we all know the names of going to sort of slowly start
00:51:38slipping in AI stuff so that, you know, they decrease their royalty load by 1%, 2%.
00:51:42But if we have something that has come in that we expect is generative AI created, either
00:51:50due to the metadata, or sometimes, you know, there's press on it, right?
00:51:57There's some very famous AI creations.
00:51:59Yeah.
00:51:59We will not pay out on it.
00:52:01We basically, and it's not, it's a minimal amount of money, but we basically hold that
00:52:09money and we will wait.
00:52:11If someday this thing that we think is generative AI turns out is ruled by the copyright office
00:52:16to have enough human input to be copyrightable, then we'll pay out on it.
00:52:20But for now, if we suspect it's fully generative AI, and if, in which case, it doesn't merit
00:52:26a royalty, we won't pay out on it.
00:52:28Got it.
00:52:29But we're not making a decision of whether it's copyrightable or not.
00:52:32We'll let the copyright office do that.
00:52:34Yeah.
00:52:34I think that's smart to hold on to the money and just wait and see.
00:52:37Everything is still so new and things are developing so fast.
00:52:40And, you know, and there's all these lawsuits related to it that are going to take many
00:52:43years to flesh out.
00:52:44And as I said, it's not a material amount of money.
00:52:47So it's not a huge issue for our business, but it could be for others.
00:52:52Yeah.
00:52:53Especially, as I said, you know, some of the bigger streaming services that we all have on
00:52:57our phone, you know, imagine if even if they could shave off just shave off just a few
00:53:02points from their from their their royalty costs.
00:53:05It could happen.
00:53:05It could.
00:53:06Yeah.
00:53:07To end off our conversation, I wanted to make sure that we touched on the American Music
00:53:11Fairness Act.
00:53:11This is something that you've been working on for a while now.
00:53:14So can you tell us about what the American Music Fairness Act is?
00:53:17Sure.
00:53:17The American coming full circle.
00:53:19Yes.
00:53:19As a good storyteller that you are.
00:53:21I try.
00:53:22We started off talking about, you know, terrestrial radio not paying.
00:53:26AMFA is a bill supported by Sound Exchange and the whole Music First Coalition to basically
00:53:31try to get FM radio to pay for the sound recordings the same way every other platform and the same
00:53:38way every other country does.
00:53:39It's basically it's a basic fairness issue.
00:53:42Radio makes 14 billion dollars a year off the recordings that drive their business and they
00:53:47share none of it with the artists.
00:53:48So it's it's it it is simply an effort to make FM be treated like all the other platforms
00:53:55out there.
00:53:56And, you know, and one thing I want to definitely say about it is, you know, we take precautions
00:54:04to protect local radio.
00:54:05It actually helps local and small radio.
00:54:08You know, if you're a smaller radio station, that's not part of a big, huge conglomerate.
00:54:12So if you're truly a small mom and pop or someone who owns, you know, just a handful of stations,
00:54:16you can basically get a royalty for five hundred dollars a year, all the music you can pay.
00:54:22And if you're certain nonprofits or educational that can go down to one hundred or even in
00:54:26some cases, ten dollars.
00:54:27So this bill is about the big commercial radio stations making the bulk of the money off the
00:54:36artists back and the labels back.
00:54:39Local radio was protected and certain, you know, educational radio is protected.
00:54:44Yeah.
00:54:44And it would be help them because now they would have this protection in federal law.
00:54:48Interesting.
00:54:49Yeah.
00:54:49I mean, you kind of anticipated what my follow up question was going to be, which is, you
00:54:55know, is this going to damage local radio further than it already has?
00:54:59But it sounds like you'll have some some rules built into that.
00:55:02We do.
00:55:03And, you know, indeed, I mean, what you see happening out there is the local radio that is
00:55:06struggling.
00:55:07They are prime candidates to be plucked off by the big the big, you know, behemoths.
00:55:11Um, so the big radio conglomerates are getting bigger as these smaller radio stations struggle
00:55:18more and more.
00:55:19So this bill, yes, it does say there's a royalty.
00:55:23But, you know, I think five hundred dollars for, you know, if you're if you're a radio station
00:55:27making one and a half million dollars and you can pay five hundred dollars for your primary
00:55:31input, that's that's that's a very fair deal to strike.
00:55:36And, you know, we're getting more and more, more and more momentum on this bill.
00:55:41You know, earlier this year, 300 A-list artists put a letter out to Congress.
00:55:47There's actually a hearing next week in the Senate on the bill.
00:55:52Gene Simmons of Kiss fame will be will be testifying.
00:55:55Huge.
00:55:55Will he be on full makeup or no?
00:55:57I suspect not, but I haven't actually asked that question.
00:56:01You know, but he's he's a great spokesperson and a perfect example of what this is all
00:56:06about, because, yes, Gene Simmons is obviously very successful.
00:56:08And but he's but, you know, you'll hear, I think, next week he certainly said this to
00:56:14us.
00:56:14He's very passionate about this issue and it's not about him.
00:56:17It's about his kids.
00:56:18You know, he has a couple of kids who are in the music industry and he looks at what's
00:56:22facing them, the challenges facing them.
00:56:24And, you know, if they have the type of exposure that he had, I mean, think of all the radio play
00:56:29that Kiss got in this country and Gene Simmons and his bandmates, you know, made little to
00:56:34nothing as artists.
00:56:35Right.
00:56:36So for him and for a lot of the artists we talk to, it's not about them and their personal
00:56:40situation or their personal revenue.
00:56:44It's really about setting up.
00:56:47The industry for the up and coming talent, the up and coming artists, because it's hard.
00:56:52It's it's always been hard to be an artist.
00:56:54It's, you know, long days on the road, long drives in a van in the early days, crashing
00:57:00on friends' couches.
00:57:01It's always been hard to be an artist.
00:57:03And in some ways, it's harder now than ever.
00:57:06You know, there's some things that make it easier.
00:57:07There are more there are more platforms you can be on.
00:57:10There's more DIY products that can help you get your stuff out.
00:57:13But to really break through and to make it, you know, a career where you don't have to
00:57:18do a side gig, it's harder than ever.
00:57:20And it's all the more reason why, you know, one of the oldest distribution platforms in
00:57:27our country should no longer get away with making $14 billion and paying absolutely zero
00:57:33to the people who make the music.
00:57:35Well, this has been super interesting.
00:57:37Before I let you go, I do want to do what I do with all my guests here on the record.
00:57:42I ask everyone to make me a playlist of three songs based on three prompts.
00:57:48So three songs playlist.
00:57:49Okay, yeah, rapid shot.
00:57:50Okay, all right.
00:57:51I got a drink for this.
00:57:52The drink of water.
00:57:55Okay, so the first prompt is a song that you can no longer gatekeep.
00:57:59So a lesser known song.
00:58:01What's your pick?
00:58:02You know what I discovered recently that I really like?
00:58:04It's by a band called Vultpeck, V-U-L-P-E-C-K.
00:58:07They're like a sort of a funk soul band out of Michigan.
00:58:12There's a great song called Animal Spirits.
00:58:14I love the song.
00:58:15It's I love funk.
00:58:16It's one of my favorite genres, if we're going to talk about genres.
00:58:20Yes.
00:58:20But it's, you know, it's got a lot of keyboards.
00:58:23It's got a lot of vocals.
00:58:23It's got a really powerful bridge.
00:58:25Love the bridge that really sort of builds and then comes down like a hammer.
00:58:29So check it out.
00:58:30Do you know Vultpeck?
00:58:31I do.
00:58:31I've heard that their concerts are incredible.
00:58:34They've got to be.
00:58:35Yeah.
00:58:35So the recent discovery of mine, I mean, they're a great band, but that's one that, you know,
00:58:40I'm new to.
00:58:41Love it.
00:58:42Okay.
00:58:43A favorite throwback?
00:58:44Favorite throwback.
00:58:45That's easy.
00:58:45I used to play keyboards.
00:58:46I don't have chops anymore, so don't ask for a sample.
00:58:50But so I've always been a big Billy Joel fan.
00:58:52And I would say Vienna by Billy Joel, Stranger Album.
00:58:58That was my senior quote in high school, you know.
00:59:00Wow.
00:59:01I love it.
00:59:01There's some great quotes in that song.
00:59:03Billy Joel's an amazing artist.
00:59:05He is.
00:59:06And what is a guilty pleasure for you?
00:59:08It's really risky for someone to say what a guilty pleasure actually is.
00:59:12It's not one song.
00:59:13It's basically the soundtrack to Pitch Perfect.
00:59:16Oh, oh, that's a perfect pick.
00:59:18I love it.
00:59:19I love it.
00:59:19The cup song.
00:59:20The cup song, you know, I mean, great songs, acapella, great harmony.
00:59:25I'm a sucker for harmony.
00:59:26Wait, so are you an acapella?
00:59:27Did you, like, watch, did you watch Glee?
00:59:30Like, how deep into acapella are you?
00:59:32I did not watch Glee.
00:59:34I was never part of an acapella group.
00:59:36I thought about trying to join.
00:59:37I went to UVA, and they had the Hullabahoos, I think, was the acapella group in Virginia.
00:59:41I never did that.
00:59:43But Pitch Perfect is a pretty good movie.
00:59:47Sorry for, you know, sorry for calling it a guilty pleasure.
00:59:50But it is.
00:59:51No, I think that's a perfect pick.
00:59:53Well, Mike, thank you so much for coming to On The Record.
00:59:55This has been so much fun.
00:59:56This has been a blast.
00:59:57Thank you for having me.
00:59:58I look forward to our next installment.
01:00:00Amazing.
01:00:02Another special thank you to Mike Huppie for coming on the show and talking to us about
01:00:05the evolution of radio.
01:00:07Up next, we're going to be diving into our charts roundup, where we'll highlight this
01:00:10week's biggest movers and shakers.
01:00:13Here is the top 10 of the Hot 100 chart dated December 13th.
01:00:18Coming in at number 10, it's It's the Most Wonderful Time of the Year by Andy Williams.
01:00:23The Christmas song Merry Christmas to You by Nat King Cole comes in at nine.
01:00:29Eight this week is Santa Tell Me by Ariana Grande.
01:00:32Number three this week is Rockin' Around the Christmas Tree by Brenda Lee.
01:01:01Number two is Last Christmas by Wham.
01:01:09And finally, number one on the Billboard Hot 100 chart for the week of December 13th,
01:01:14It's All I Want for Christmas is You by Mariah Carey for its 19th week at number one.
01:01:20Thanks for listening to this week's episode of On The Record.
01:01:23And another special thank you to my guest, Mike Huppie, for coming on the show.
01:01:26If you liked our episode today, please consider hitting us with a rating or a follow
01:01:30or a thumbs up or all of those good things.
01:01:33They really help our show to grow and to reach new audiences.
01:01:37Again, I'm your host, Kristen Robinson.
01:01:39And tune in next week for another peek behind the curtain of the music business.
01:01:42I'll see you then.
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