Entercom Communications will share terrestrial radio revenue with Nashville record...
Entercom Communications will share terrestrial radio revenue with Nashville record label Big Machine, home of Taylor Swift, Tim McGraw and other artists, the companies said Thursday. The agreement, first of its kind for Entercom will “align their business interests and…
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accelerate growth and innovation in digital radio to the benefit of music fans and radio listeners everywhere,” the companies said. They said Big Machine’s artists would “directly participate” in the agreement, a nod to continuing rancor between artists and their labels over how new revenue streams get split. “While the deal comes with some significant costs and risks, we believe that by working with the labels and the artist community to establish a new business model, we will ultimately enhance the opportunities for all parties concerned,” said Entercom President David Field. Entercom is “seeing where listeners are going in regards to how radio is being used now and where and how it will be used in the very near future,” said Big Machine President Scott Borchetta. “Among the many choices in the audio entertainment landscape, radio is now portable again thanks to smartphones and soon-to-be ubiquitous Internet streaming in the car.” NAB President Gordon Smith also addressed such deals between labels and radio stations at the Radio Show in Dallas late Wednesday. “We must have the courage to face our future head on and ask ourselves, ‘What do we want to be?'” he said. “Is it terrestrial, or streaming or both? If both, how do we shape a strong future for both revenue streams?” Clear Channel “bet on the future of streaming” through its Big Machine terrestrial revenue-sharing deal earlier this summer (CD June 7 p11), which some called “risky” and others “bold and forward looking,” Smith said: “I believe each company must evaluate its future and make its own bold decisions. Indeed, the agreement between Clear Channel and Big Machine may ultimately answer many questions about whether the future is streaming.” What “we can all agree on” is that “radio’s future lies in being incorporated into every new device,” he said. “And uniting in our advocacy will ensure we achieve that goal,” just as broadcasters united against performance tax legislation in 2010, Smith said. “When government decisions threaten radio’s future and broadcasters’ ability to serve listeners, we must continue to speak with one voice and unite when the need arises."