Radio again seeks to include FM tuners in mobile phones

Congressional lawmakers today will hear how new tech is affecting distribution and consumption of audio content.

Tim Westergren, one of the cofounders of Pandora, is among those expected to testify today at a House subcommittee on 'The Future of Audio.' James Martin

In the case of a major earthquake, terrorist act or some other disaster, cell phones will be useless, according to radio broadcasters.

Today at a congressional hearing in Washington D.C., broadcasters are expected to tell lawmakers that in emergencies, cell networks become clogged and have proven to be unreliable. What people need are FM tuners built into their handhelds that will enable them to receive radio reports.

That's what Jeff Smulyan, chairman and CEO of Emmis Communications, which owns AM and FM radio stations, is expected to make this argument when he testifies before a House subcommittee on Communications and Technology. But many from the tech sector are warning Washington not to be fooled. They argue this is a cheap attempt by radio to piggyback on cellphones and avoid becoming more irrelevant in the digital age.

This is just one of the topics we'll hear about today during the subcommittee's hearing on "The Future of Audio." The committee is studying how new technology is affecting distribution and consumption of audio content.

Tim Westergren of Pandora, Cary Sherman of the Recording Industry Association of America (RIAA) and Christopher Guttman-McCabe from CTIA, the international association for the Wireless industry, are also expected to testify.

We're likely to hear about performance rights. The major record companies want radio broadcasters to start paying fees for the music they play -- just like the Webcasters do. The labels can now point to a groundbreaking deal announced yesterday in which Clear Channel, the nation's largest owner of radio stations, agreed to share revenue with a country-music label that represents Taylor Swift, Tim McGraw and Reba McEntire.

RIAA CEO Cary Sherman says music industry has gone from $190 million in digital revenue in 2004 to $3.5 billion last year. Greg Sandoval/CNET

We're likely to hear Sherman play up the progress made by the four largest record companies in distributing music online.

"CDs are no longer the primary format for the music business or the primary way the industry generates revenues," Sherman said in his written testimony, a copy of which the RIAA distributed this week. "Digital is not just our future, it is our present. In 2004, the first year we had any meaningful digital revenues, the industry earned a grand total of $190 million from digital services. Last year, we hit nearly $3.5 billion."

But the issue that may bring the most heated debate is about the FM tuners.

"We view this mandate as an assault on the rights of artists to be fairly compensated for their creativity and a severe blow to American technological innovation," wrote Gary Shapiro, CEO of the Consumers Electronics Association, in a letter to members. "The broadcasters' proposed FM Chip mandate has nothing to do with emergency broadcasts and has everything to do with big radio expanding their special interest loophole at the expense of smartphone innovation, minority artists and the music community."

Dennis Wharton, a spokesman for the National Association of Broadcasters, says some on the electronics side are trying to spread misinformation. He denied that broadcasters are asking Congress for a mandatory inclusion of the FM tuner.

"We think it makes perfect sense from a public safety perspective," Wharton said. "Only in America are listeners prevented from accessing radio from cell phones. It's standard feature in Europe and Asia. And the reality is cell carriers would prefer selling apps to their cell phone users rather than provide a free over-the-air service to their listeners."

Note: The hearing will be Webcast at 7:15 a.m. PT. You can watch it via Webcast here.

 

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