Rival Industry Groups Endorse FM Chip Mandate

Published September 7, 2010

The National Association of Broadcasters (NAB) and the Recording Industry of America Association (RIAA) temporarily halted their bitter feud over the Performance Rights Act long enough to jointly endorse a federal mandate for placement of FM radio receivers in all handheld electronic devices.

The Consumer Electronics Association (CEA) opposes such a measure, however.

The proposed mandate stems from a bipartisan Congressional letter signed by 60 members, addressed to the Department of Homeland Security and the Federal Communications Commission.

The letter, dated September 8, 2009, stressed the public safety benefits of increased access to FM’s emergency alert system.

Temporary Truce

The common ground claimed by NAB and RIAA on the FM chip issue is a truce of sorts in their ongoing war of words over the Performance Rights Act. The proposed legislation would require broadcasters to pay performance royalties to recording artists. Currently, only songwriters receive broadcast royalties under U.S. copyright law.

The CEA opposes the measure, claiming it would place an unfair financial burden on stations broadcasting music. The RIAA supports the bill on the grounds it would create another revenue stream for artists receiving airplay.

The two sides agree on supporting a government mandate to add FM chips to mobile handsets because radio receivers could give cell phone subscribers “a direct sales point for music and cell phone providers with a new revenue stream,” says Dennis Wharton, NAB executive vice president of communications.

The Safety Debate

Another rationale NAB gives for supporting the initiative is to allow wireless phone users to access local radio during emergencies.

“Cell phones and other mobile devices are increasingly ubiquitous,” said Wharton. “It makes perfect sense to have radio-enabled chips in these devices, particularly from a public safety perspective.”

Wharton continued: “If 257 million cell phone users in the U.S. have radio access during an emergency, the information provided by local radio stations would be far more beneficial than any text-based system limited to 90 characters.”

However, CEA Director of Communications Megan Pollock notes she receives text messages more specific to her location than FM could manage.

“The broadcast range of the FM frequency is pretty wide,” she said. “I live in Virginia, and I don’t need to know about a tree falling over the road somewhere in Baltimore. On the other hand,” she said, “I regularly receive text messages about traffic snarls and extreme weather that directly pertain to where I live.”

‘Believers in the Marketplace’
“Mandating that a manufacturer build a radio into every portable electronic communications device?” asked Scott Kahn, editor-in-chief of MusicPlayers.com. “Americans aren’t even required by law to own a telephone, nor a radio, so requiring manufacturers to build a radio into every portable electronic communications tool has got to be one of the most absurd things ever proposed. Maybe it’s to make sure that in the event of an emergency, everyone can listen to commercials from radio advertisers.”

Pollock said CEA opposes the mandate because the market is already providing what the government wants to require.

“We’ve done research and found that there are already 20 phones on the market that have FM reception capability,” she said.

“Furthermore, we’re big believers in the marketplace, and don’t think mandating anything is ever beneficial,” she continued. “It’s not good for the consumer, and it’s not good for the industry.”

Bruce Edward Walker ([email protected]) is managing editor of Info Tech & Telecom News.

Internet Info:

“Radio, RIAA: mandatory FM radio in cell phones is the future,” Ars Technica, August 16, 2010: http://arstechnica.com/tech-policy/news/2010/08/radio-riaa-mandatory-fm-radio-in-cell-phones-is-the-future.ars

Congressional letter to Homeland Security and the Federal Communications Commission, September 8, 2009: http://www.heartland.org/infotech-news.org/article/28356/Congressional_letter_to_Homeland_Security_and_the_Federal_Communications_Commission_September_8_2009.html

“A Fact-Based Response to the Critics of Radio-Capable Cell Phones,” National Association of Broadcasters Policy Blog, August 25, 2010: http://blog.nab.org/2010/08/25/cell-phones/