Grammys are latest forum for fight over music payments

Last night’s Grammy Awards served up the usual hoopla and back-patting. But a policy plea from singer Jennifer Hudson also underscored how 2015 is likely to be the year when a long-brewing fight comes to a head over how — and how much — musicians should be paid.

At the show, Hudson announced the launch of an artist group called the”Grammy Creators Alliance” that will advise the government on royalty issues, while One Republic singer Ryan Tedder told the audience “music activism is coming at exactly the right time. From the Turtles to Taylor Swift, longtime established and new generations are speaking out.”

While the speeches were short on specifics, a website for the group echoes recent rhetoric from the recording industry, and appears intended to pressure Congress into passing bills like last year’s proposed “Respect Act,” which called for awarding a windfall to older musicians.

The Grammys plea also comes after the Copyright Office last week published a 245-page report that suggests dramatic changes to the music royalty system in the U.S. These could include removing consent decrees that set a cap on how much radio stations, streaming services and cover bands must pay songwriters to play their works.

The combination of industry lobbying and Grammy-style star power means the music industry is likely to get at least some of what it wants. But many of the proposed measures could also means higher prices for consumers, and new uncertainty for popular digital music services like Pandora and Spotify.

Currently, the digital services pay a far higher percentage of their revenue for royalties than do traditional AM/FM outlets, and are struggling to make money. Nonetheless, the services are regularly vilified by the music industry, which is calling on them to pay even more.

Meanwhile, the debate over what digital radio services should pay is also before the courts, in major cases concerning songwriter royalty rates. Members of the band The Turtles are leading class action cases that demand new money for old recordings.

Underlying all of the disputes is the ongoing economic disruption confronting the music industry over lost CD sales. Meanwhile, all sides appear in favor of simplifying the current mishmash of royalty regulations that draw major distinctions between digital and non-digital services.

Boxing in Pandora

While Warner is the first major record label to sign such a broad royalty deal its arrangement with Clear Channel is already being looked to as a template for a broader detente between the record companies and broadcasters.But it may not be a template Pandora can follow.