Chapter 1: What is the main topic discussed in this episode?
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Bloomberg Audio Studios. Podcasts. Radio. News. We zero in specifically on the connection between Washington and the music industry. Regulation. And I'll point you no further. Then an op-ed in the Washington Post, the headline, Congress, I have a plea for you. It was written by Gene Simmons. Yes, that Gene Simmons, who was on stage at the Kennedy Center last weekend, the Kennedy Center Awards.
You saw him in the Oval Office with Donald Trump. And you also saw him testifying on Capitol Hill yesterday before the Judiciary Committee for something called the AMFA Act. This is about music fairness, royalties. Listen to what he said.
How do we dare come in second to Russia, an alleged country led by a despot, when they do a better job of paying our king of rock and roll, and we're going to stand by and not pay today's artists and fans?
future artists because let's face it our children are tomorrow's stars it got to change this now for our children and our children's children and i know you will the president will sign this once all you guys respectfully get your act together and put this across the board let's do the right thing god bless america
He's talking about the American Music Fairness Act's proposed legislation that may or may not get a floor vote. But of course, with the support of the president, that would go a long way. It's got the support of Gene Simmons, and he's with us right now in studio. You spent the week in Washington. Thanks for making us part of it.
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Chapter 2: What is the American Music Fairness Act and why is it important?
And I've been knocking around the radio business for a minute. We hear about BMI and ASCAP fees. Has this always been the case, or was it simply an exchange? You play my music for exposure, for publicity, and I sell tickets and I sell albums, and that's now out of balance.
Is that what happened? Artists are not interested in negotiating how their careers are built. Understood. Radio needs recording artists. Where did the ASCAP BMI fees go? ASCAP and BMI specifically relates to writers and publishers, which doesn't affect the masses whatsoever. So is this radio's fault or your contract with the record company? How come the middleman isn't giving you money?
Nothing to do with the record company because they make money when they sell records. and writers and producers. This is the actual recording artist. You like Elvis, you like Sinatra, when you hear that song on the radio, the people we tune in for actually never get paid. Amazing. Everybody else gets paid. The writers and the publishers and the advertising dollars.
Radio last year made $14 billion. You know how much of that went to the Sinatra estate or Tame Impala or all the new bands?
I think I'm getting it. Zero. Yeah. Okay, that's in contrast to satellite radio, digital platforms. But we're not talking about that. No, I know, but I just want to square that you're suggesting the radio industry is behind the times because all of these other platforms are paying attention.
I'm not suggesting anything. I'm stating fact that AM, FM radio is, well, I want to use language that doesn't get anybody legal involved. In the patois of the street, it's criminal.
Yeah.
You cannot, America is based on the premise that if you work hard, you should get paid. So everybody's getting paid. When a radio station, AM and FM broadcasts, the executives get paid, the advertisers pay money, the billboards on the street which use our name and likeness for free. If you use my name and likeness otherwise, I would take your firstborn and your house.
But radio is allowed to do that. They keep $14 billion. And the new artist, by the way, who's trying hard to make it, is not going to make those precious pennies to help them survive. And that's, as far as I'm concerned, my opinion is, it's criminal.
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Chapter 3: How does Gene Simmons describe the current state of artist compensation?
Nobody gets this much time, Gene Simmons. Okay, so you've said a lot. Well, we consider the future of the music business. Do you worry about AI regulation? Do you worry about these FACO bands coming up? Speaking of algorithms, and by the way, Mike Bloomberg is not only the boss here, but founder and chairman of Bloomberg LP. That's right.
AI is a worry for you or not? AI is a concern if left unregulated. Anything, a beautiful horse that you just bring in, if it runs wild, you've got to have some parameters that we control instead of AI. Right now there's a country and western star that's got a number one record of sorts on some chart, doesn't actually exist. Yeah. What do you think of that? Well, let me just go.
The major problem here, potentially, hypothetically, and otherwise, is that if states have the right, and this has to be settled right away, the government must get involved. A federal law that encompasses all of AI to get some sanity out of this.
Because if you can do AI legally in Delaware, where you have all your companies so you pay less taxes, because you're a very bright man besides being good looking. Why should they want to do real music and real art in New York when they can just go to Delaware and do AI? No, you need a federal law that encompasses the entire country.
And I would highly recommend and I would hope the entire planet... really gets together. It's an issue for the UN to get a world body to accept it because it's going to happen to the same thing that happened to the unions in America. You charge too much here, so we'll do business in China.
No, you want to address the AI issue worldwide so we can control what the rules are, the comings and the going, and what's the income stream, who owns the IP, who's the owner of the trademark ad information. And I'd like to announce that I'm running for...
If you were a kid, you bought a guitar, you wanted to get in the music business, what would you tell them, turn and run?
Well, I would tell anyone to do as I did, which is to say to have a fallback position. Because anything that you pour your heart and soul into has a pretty good chance, and that means likely 95% or more. You will fail. And in my case, I became a sixth grade teacher and an assistant to the editor of Vogue magazine, Kate Lloyd, and
the assistant to the Puerto Rican Interagency Council, Magdalena Miranda for the Boricua community, where I did work for a government research and demonstration project, ad infinitum ad nauseum. In other words, if your thing doesn't work out, What's the backdrop? Like, I know you took ballet lessons. If this doesn't work out, you can get up and do your thing.
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Chapter 4: Why are artists not paid for their music on AM and FM radio?
It's pretty cool for you to be here, and I appreciate it very much. It is the American Music Fairness Act. That's what he came here to talk about. You don't need me to tell you. Gene Simmons. The forces shaping markets and the economy are often hiding behind a blur of numbers. So that's why we created The Big Take from Bloomberg Podcasts, to give you the context you need to make sense of it all.
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