Radio Silence in the USA?

Posted on 21. Jul, 2010 by in Blog, Commentary

RBR-TVBR recently drew attention to one of the best examples we have of the lasting impacts of performance fees: In India, radio stations are going silent to save on royalty costs, turning off completely during the overnight hours.

RBR-TVBR questions the wisdom behind this decision:

The bottom line is that you really have to wonder about a policy that makes silence the better option for a broadcast station.

When radio stations go silent, the jobs go with them. This loss of jobs would be in addition to money-saving cuts at other radio stations and other economic impacts that will be felt over the long-term as a result of the performance tax.

This all underscores a greater issue – how do the radio and record industries deal with the continued repercussions of the economic recession?

Consider a recent report released by the Center for Economic and Policy Research that says the jobs hole created by the recession could persist for decades.

Write CEPR’s John Schmitt and Tessa Conroy:

Even if the economy creates jobs from now on at a pace equal to the fastest four years of the early 2000s expansion, we will not return to the December 2007 level of employment until March 2014.

As Congress continues to pass legislation aimed at creating jobs, they also debate implementing a performance fee that would destroy jobs existing employment opportunities.

Shutting down some stations completely and putting staff out of work at others are only some of the unintended side effects of the performance tax – side effects that would only serve to exacerbate the lasting impacts of the recent economic downturn.

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