The bill amends Title 17 to treat all ‘‘audio transmissions’’—digital, analog, or otherwise—as within the sound‑recording public performance right, expressly bringing traditional terrestrial broadcast radio under the statutory licensing framework that long covered digital services. It substitutes the word ‘‘audio’’ for ‘‘digital’’ across numerous provisions, defines ‘‘audio transmission,’’ and requires the Copyright Royalty Judges (CRJs) to promptly set rates for non‑subscription broadcast transmissions effective through December 31, 2028.
The measure also creates special low flat annual royalties for small, low‑revenue terrestrial stations ($10, $100, or $500 depending on status and revenue thresholds), prescribes a 50 percent forwarding rule when a copyright owner directly licenses a transmitting entity that would otherwise qualify for the statutory license, and directs CRJs to consider promotion value when fixing rates. Those changes reallocate how money flows to featured and nonfeatured performers and impose new compliance and administrative tasks on broadcasters and collectives—while explicitly preserving songwriters’ public performance rights for musical works.
At a Glance
What It Does
The bill expands the sound‑recording performance right to cover all audio transmissions and folds terrestrial (over‑the‑air) radio into the statutory licensing regime in section 114. It directs the Copyright Royalty Judges to begin proceedings promptly and sets default royalty treatments for small stations, while altering how royalties from direct licenses must be split with the statutory collective.
Who It Affects
Terrestrial broadcasters (from single‑station mom‑and‑pops to national groups), record labels and performing artists (featured and nonfeatured), the nonprofit collective that distributes section 114 receipts, and the Copyright Royalty Judges and their regulated proceedings.
Why It Matters
This is a structural rewrite of who gets paid and how for radio airplay: artists and labels gain a clearer path to performance royalties from over‑the‑air broadcasts, small stations get sharply discounted flat fees, and licensing markets for direct deals must now account for mandatory forwarding to the statutory collective.
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What This Bill Actually Does
The bill creates a single, technology‑neutral performance right for sound recordings by replacing multiple references to ‘‘digital audio’’ with ‘‘audio transmissions’’ and by defining ‘‘audio transmission’’ to include digital, analog, or other formats. Practically, that means traditional over‑the‑air radio is brought within the statutory architecture that governs online and satellite transmissions: statutory licenses, CRJ rate proceedings, and collective distribution rules now explicitly apply to terrestrial broadcasts.
To accelerate implementation, the bill requires the Copyright Royalty Judges to commence a rate‑setting proceeding as soon as practicable and to set rates and terms for non‑subscription broadcast transmissions effective from enactment through December 31, 2028, with five‑year repetition thereafter. The bill delays the initial payment obligations tied to those proceedings until the first royalty payment date established under the CRJ determinations, limiting immediate cashflow shocks to broadcasters pending final rates.Recognizing concerns about burden on local outlets, the statute prescribes fixed, very low annual royalties for qualifying small terrestrial stations: $10/year for stations with under $100,000 in prior year revenue; $100/year for public broadcasters with $100,000–$1.5M revenue; and $500/year for non‑public stations with $100,000–$1.5M revenue.
Eligibility depends on station and owner/operator revenue caps (station under $1.5M; owner/operator and affiliates under $10M) and a signed certification to the designated nonprofit collective.On distribution, the bill requires that when a copyright owner directly licenses a transmitting entity that would otherwise be eligible for the statutory license, that entity must forward 50% of the total royalties required under the direct license to the statutory collective; the collective must distribute those amounts to performers and rights holders according to the statutory allocation scheme. Finally, the bill instructs CRJs to account for whether radio play substitutes for or promotes sales and other revenue streams when setting rates, and it states explicitly that nothing in the Act reduces public performance rights or royalties owed to songwriters of musical works.
The Five Things You Need to Know
The bill defines ‘‘audio transmission’’ to include digital, analog, or other formats and applies the sound‑recording public performance right to that full category.
CRJs must commence proceedings promptly to set rates for non‑subscription broadcast transmissions effective from enactment through December 31, 2028, and repeat the proceeding every fifth year.
Qualifying small terrestrial stations pay fixed annual royalties of $10, $100, or $500 depending on prior‑year revenue and public‑broadcast status, subject to owner/operator aggregate revenue caps ($10 million).
If a copyright owner directly licenses a transmitting entity that would otherwise be licensed under section 114(f), that entity must pay 50% of the total royalties payable under the direct license to the statutory collective, which then distributes those funds per section 114(g)(2)(B)–(D).
The bill bars using the small‑station royalty rates as precedent or evidence in future CRJ or other government proceedings that set or adjust royalties or recordkeeping requirements.
Section-by-Section Breakdown
Every bill we cover gets an analysis of its key sections.
Technology‑neutral 'audio transmission' performance right and conforming edits
This section amends section 106(6) and multiple provisions in sections 112, 114, and the definitions in section 101 to replace ‘‘digital audio’’ with ‘‘audio’’ and to add a compact definition of ‘‘audio transmission.’' The effect is to make the performance right agnostic to transmission medium and to bring terrestrial broadcast transmissions explicitly within the scope of section 114 statutory licensing constructs. Practically, broadcasters that previously relied on the absence of a federal sound‑recording performance right for over‑the‑air radio will now fall under the same framework that governs online and satellite services.
Cleanup of cross‑references and expansion of covered signals
This subsection performs sweeping word substitutions and cross‑reference fixes throughout Title 17 so that ‘‘subscription digital’’ references become ‘‘subscription’’ and multiple places that referenced ‘‘digital signal’’ are changed to ‘‘signal.’' It also explicitly fold retransmissions of broadcast transmissions into the defined scope. Those changes remove textual distinctions that courts or agencies might have used to exclude particular transmission types, reducing ambiguity but increasing the scope of the statutory license.
Immediate CRJ proceeding and rate effective period
The bill adds a directive to the CRJ timing statute requiring an expedited commencement of a chapter 8 proceeding to set royalty rates and terms for non‑subscription broadcast transmissions, with rates effective from enactment until December 31, 2028. It also states that payments under section 114(f)(1)(D) (the special small‑station rates) are not due until the first royalty payments established by CRJ determinations—introducing a deferral mechanism that affects timing of cash flows while leaving rate setting to the CRJs.
Flat, low annual royalties for small terrestrial broadcast stations
This section creates three discrete fee tiers for individual terrestrial stations based on prior year station revenue and the station owner/operator’s aggregate revenue: $10/year for stations under $100,000 revenue; $100/year for qualifying public broadcasters with $100,000–$1.5M revenue; and $500/year for non‑public stations with $100,000–$1.5M revenue. Eligibility requires the owner/operator and related entities have aggregate revenue under $10M and a signed annual certification to the nonprofit collective. The clause also says these statutory small‑station rates cannot be used as evidence in future rate proceedings, insulating CRJs from being bound by these administrative floors.
50% forwarding rule for direct licenses and collective distribution mechanics
This new paragraph in section 114(g) requires that if a copyright owner directly licenses a transmitting entity that would otherwise be eligible for the statutory license, that licensed entity must forward 50% of the total royalties it owes under that direct license to the nonprofit collective that distributes statutory licensing receipts under subsection (f). The collective will allocate those forwarded amounts according to the statutory distribution percentages for featured and non‑featured artists and rights holders. The provision aims to prevent circumvention of statutory distributions when direct deals are made.
Songwriters preserved; CRJs must consider promotional value
Section 6 explicitly states the Act does not diminish public performance rights or royalties payable to songwriters and owners of musical works, insulating musical‑work stakeholders from unintended harm. Section 7 instructs CRJs to consider economic, competitive, and programming evidence, including whether broadcasts substitute for or promote sales and other revenue streams, when setting rates for terrestrial radio—formally making promotional value a factor in rate determination.
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Who Benefits
- Small terrestrial broadcasters (independent AM/FM stations and qualifying public broadcasters): receive sharply discounted, fixed annual royalty rates ($10, $100, or $500) that keep licensing costs predictable and minimal for low‑revenue stations.
- Featured and nonfeatured performing artists and record labels: gain an explicit statutory pathway to performance royalties from terrestrial radio through the expanded performance right and the statutory collective’s distribution of receipts and of forwarded direct‑license funds.
- The nonprofit collective designated to distribute section 114 receipts: will receive new revenue streams (statutory receipts plus 50% of certain direct‑license royalties) and, consequently, greater centrality and administrative responsibilities in distributing payments to performers and rights holders.
Who Bears the Cost
- Large broadcast groups and national radio networks: face newly material royalty exposure once CRJs set rates for terrestrial transmissions and cannot rely on historical nonpayment for sound recordings.
- Record companies and copyright owners who prefer direct licensing: may see their direct‑license economics altered because 50% of signed direct‑license royalties to qualifying transmitters must be forwarded to the statutory collective.
- Copyright Royalty Judges and the designated collective: will bear increased administrative and adjudicative workload to run expedited proceedings, design certification requirements for small stations, and implement the 50% forwarding and distribution processes—potentially requiring new rules, audits, and enforcement resources.
Key Issues
The Core Tension
The bill seeks to balance two legitimate objectives—ensuring performers and sound‑recording owners receive compensation from the continued commercial exploitation of their recordings on radio, and preserving the economic viability and promotional role of local terrestrial radio—yet every tool that secures payments (broad statutory scope, forwarding rules, expedited rate setting) also risks raising costs for broadcasters or changing incentives for direct licensing; the central dilemma is how to compensate performers fairly without extinguishing radio’s promotional value or forcing small stations into financial distress.
The bill resolves a long‑running policy gap by treating terrestrial radio as a source of payable performance royalties for sound recordings, but it leaves multiple implementation choices to the Copyright Royalty Judges and to rulemaking by the collective. The CRJs must convert a policy directive into workable rate schedules while weighing promotional offsets and competitive effects; the statute’s instruction to consider promotion value is necessarily qualitative and will require the CRJs to build a factual record on substitution versus promotional impact.
That evidentiary work is complex: quantifying how many record sales or streams a spin generates—and crediting that against royalties—will shape ultimate rates.
The 50% forwarding rule for direct licenses could rewire the licensing market. It prevents certain direct deals from undermining statutory distributions, but it also creates an arbitrage question: copyright owners and large labels may alter upfront license fees, change contractual terms, or restrict which transmitters they will license directly.
The bill’s low, flat fees for small stations create administrative eligibility tests (station vs. owner/operator revenue thresholds, certifications to the collective) that invite both disputes and potential gaming (e.g., restructuring ownership to meet caps). Finally, the provision that small‑station rates are inadmissible in future rate proceedings removes one path for broadcasters to argue for lower rates in CRJ settings—but it also raises questions about how CRJs will view the market when a statutory low‑fee class is carved out but excluded from precedent.
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