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Subcommittee Discusses Developments in Audio Distribution

Press Release

Location: Washington, DC

The Subcommittee on Communications and Technology, chaired by Rep. Greg Walden (R-OR), today heard from a musician, broadcast and Internet radio providers, and representatives of the songwriting, record label, wireless and consumer electronics industries, about how advances in technology are changing the way Americans gain access to and consume audio content.

Recognizing the fast pace at which the audio industry is evolving, Chairman Walden outlined the many different ways audio content can be distributed. He said, "On the one hand, this means today's songwriters and performers have a wealth of options for reaching music lovers. On the other, it means securing a critical mass of listeners may be harder as audiences fracture. Are artists liberated by the digital age or finding it harder to cut through the cacophony? Is it ironically easier to start a career but harder to make a living in the music business today? Is the pie getting larger or is everyone nibbling on each other's slice? One thing is certain. Experimentation will be critical as new technologies challenge existing business models."

Energy and Commerce Committee Chairman Fred Upton (R-MI) added, "Not only has the ability to access a world of professional audio content gotten easier and more universal, the ability for people around the world to produce and distribute their own works over the Internet has changed major industries: music, journalism, and entertainment to name a few."

Cary Sherman, Chairman and CEO of the Recording Industry Association of America, echoed Upton and Walden's comments. Sherman said, "The bottom line is that the music industry today has transformed how it does business, and we expect the industry to continue to evolve, enabling new artists to prosper and allowing consumers to enjoy their works in many different ways."

Steven Newberry, President and CEO of Commonwealth Broadcasting, explained the challenges facing his business are due to the rapidly changing audio environment. "Technological changes over the past decade have led to exciting new developments in the radio industry," said Newberry. "Streaming, podcasting, HD radio, mobile devices and other new platforms present both opportunities and challenges for radio broadcasters. Digital distribution is still only a small part of overall audio consumption, but it is providing innovative ways for us to reach and serve our listeners."

"As mobile broadband becomes more ubiquitous, the mobile platform -- whether accessed by phone, by tablet, or by some other connected device -- provides a compelling opportunity for artists and entrepreneurs to deliver, and consumers to access, all sorts of audio products. Whether their interests lie in music, in news, in sports or even in politics, consumers can and will be able to access content of their choosing, tailored to their preferences of the moment," added Christopher Guttman-McCabe, Vice President for Regulatory Affairs at CTIA. "With the right combination of good spectrum policy and regulatory restraint, reliance on the innovative capabilities of American entrepreneurs, and trust that consumers know what they want, the future of audio is, and should remain, bright."

Gary Shapiro, President and CEO of the Consumer Electronics Association, explained, "The audio marketplace for music and information is incredibly vibrant. Remarkable innovations are entering the market at a rapid pace, and thriving new business models are being created. The winners are US consumers, who have unparalleled access to news and information from a multiplicity of sources."

Following on the heels of the recent announcement by Clear Channel and Big Machine to enter into an agreement to share over-the-air revenue while also trying to grow the online market, Upton stated, "It looks to me like an agreement that might break a log jam that has plagued this space and help advance online radio. Best of all, it did not require legislation or regulation."

"I, for one, encourage the private sector to negotiate deals without government involvement," added Walden. "It is much better for stakeholders to solve their own business matters than for us to try to solve them for them."

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