Media Centre > News Releases > Archive > 1996 > May 29, 1996

Radio, music's biggest booster, shouldn't pay twice

TORONTO, May 29, 1996 - Broadcasters' contention that local radio should be fully exempted from neighbouring rights in the government's new copyright bill gains strong support in an Angus Reid study released today.

Contrary to music industry claims, the study shows that free airplay generously compensates performers and producers for the use of their music. It further reveals more people first learn about new music on radio than from all other sources combined.

Conducted in early May, the study confirms that Canadians in every age group and all regions of the country believe 'hearing it on radio' is, by a wide margin, what most influences their record buying decisions.

When asked about their music purchases in the last six months, 45% of respondents named radio as the most important influence, outstripping all other factors by almost 3 to 1. Video/television was second, influencing just 16% of music buyers.

Supporting several earlier studies, the Angus Reid findings fly directly in the face of music industry claims radio doesn't sell recordings anymore. A powerful coalition of music associations used that argument to persuade the government to impose neighbouring rights on the struggling radio industry.

"Our new evidence proves convincingly the government was misled and made the wrong decision," stressed Michael McCabe, President of the Canadian Association of Broadcasters (CAB), at a special news conference in Toronto. "The copyright reform bill unfortunately ignores the long and successful partnership between radio and the music industry."

Added McCabe: "The bargain is we play their music and, as a result, our listeners buy their CDs and cassettes by the millions. But the music industry wants to break the deal by demanding even more from radio - on top of free airplay and
$22 million a year in music fees."

The poll of 1,002 Canadians age 16 and over shows radio is number one in influencing record purchases across all age groups and music station formats. Sixty-three per cent of record buyers also recommend music to others after hearing it on radio.

"The music industry wants to charge us for airplay that clearly benefits their artists," stressed McCabe, noting that airplay alone has traditionally been considered fair compensation. Artists benefit further from radio airplay because it helps to sell concert tickets and spin-off products, he added.

Private radio can't afford new music fees, says CAB. Neighbouring rights would further tip the scales in favor of the booming recording industry, leading to lost radio jobs, reduced local service and even station closures. Local radio needs a full exemption, similar to that enjoyed by American broadcasters.

Canadian radio lost $180 million over the last five years and might barely break even this year. In contrast, the music industry recorded profits of $587 million in the same period.

The CAB represents the vast majority of Canada's local-serving, advertising supported radio and television stations.

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(Background material available on request.)

Please contact:

Susan Tolusso
Director, Communications
(613) 233-4035 ext. 331
(stolusso@cab-acr.ca)