NAB reports (Jan-Dec 1941)

The IRNA board was authorized by the membership to take such action as in its judgment will be effective in carrying out the spirit of the resolution on the monopoly report. Later, at the organization meeting of the Board of Directors of IRNA, the resignations of Samuel Rosenbaum as Chairman and Paul W. Morency as Vice Chairman, were rejected by the Board, and they were requested and agreed to continue to serve until the next meeting of the Board to be held at the call of the chair. The Board adopted the following resolution: “The Officers are directed to prepare and submit a plan for approval by the Board and for IRNA to support such offers as will be organized by any and all agencies in the industry to endorse the White Senate resolu¬ tion and endeavor to obtain its passage.” The Board also authorized the officers to submit a recommen¬ dation for the engagement of a paid representative to conduct negotiations with the networks in further offers to obtain adoption of the changes in network operating practices recommended by IRNA for the past three years. Wednesday, May 14 At the morning session of Wednesday, Neville Miller introduced for the presentation of BMPs picture, the following speakers: Merritt E. Tompkins, Vice President and General Manager, Carl Haverlin, Director of Station Relations, Sydney M. Kaye, Vice President and General Counsel, Mr. Tompkins gave an account of the physical operations of BMI. He pointed out that BMI had within one year built up an organization which employed 323 persons. Mr. Tompkins said: “BMI under contract has acquired for its licensees performance rights in the catalogues of 111 affiliated music publishers. ... I have not broken down the exact number of titles involved, but a con¬ servative estimate would place the grand total in excess of 400,000 different compositions. . . .” He read to the meeting letters from music publishers expressing their gratitude to BMI for enabling them to popularize their music which had hitherto been barred because of the ASCAP monopoly. Said Mr. Tompkins: “Since our inception, commercial phonograph record companies have sold in excess of four millions of records of BMI copyrighted titles. Add to this an additional six million records of the music of our affiliated publishers, and we have a grand total of in excess of ten million phonograph records sold.” Mr. Tompkins further said: “From October 1, 1940 to April 30, 1941, we averaged in sales 52,250 copies weekly. For the first quarter of 1941, we have aver¬ aged 74,600 copies a week. I contend that this in an all time high record of sales from the catalogue of one publisher.” Carl Haverlin reported to the convention that during the first license period of BMI, radio stations had bought 73,692 shares of stock, which, with the BMI license fees, brought total revenue to BMI of $1,849,050. “It is significant,” Haverlin declared, “that, quite to the contrary of ASCAP’s statement that BMI is controlled by the networks, only 18j^% of BMI stock was bought by the networks and 82% of BMI stock was purchased by independent radio stations.” The BMI renewal period which commenced April 1st of this year, he added, saw an increase in the number of stations sub¬ scribing to BMI. Over 654 stations have this year agreed to pay BMI for their license fees $1,973,500. Haverlin pointed out that BMI was created during a series of district meetings of the National Association of Broadcasters in the winter of 1939 and spring of 1940, and that every promise made by the organization to the radio stations had, according to these stations, been completely fulfilled. BMI took as its premises that there is a direct relation between radio performances of popular music and its popularity and sale, he explained, and that it was perfectly feasible by exploring hitherto untapped fields to bring to the public a fresh source of music supply. Special emphasis was laid by the BMI station relations director on the solidity of the industry during BMPs first and second license period, particularly among the lower income radio stations. Of this group, numbering over 400, with incomes below $50,000 per annum, 67%, or 270 stations, are BMI stockholders. It is interesting to note, he concluded, that this BMI group of 270 exceeds one-third of all the commercial stations in the United States. Sydney M. Kaye, \'ice President and General Counsel of BMI. pointed out that not only had broadcasting maintained its full advertising revenues but that listener interest in popular as well as concert music programs had. according to recent surveys, actual!)’ increased from January, February and March of 1940 to January, February and March of 1941, a period during which BMI music was exclusively on the air. Mr. Kaye pointed out that it had been conclusively established that radio performances, contrary to ASCAP’s previous statements, did not hurt music sales but helped them. Said Kaye, “We have not only paid our composers well, but we have paid them honestly and on a scientific basis in exact proportion to the use which radio has made of their works. This has never been done before in this country, and BMI is proud of it,” Mr. Kaye saici, “The importance of radio as a medium for the exploitation of music carries with it the social responsibility not to leave that field in the hands of .ASC.\P. an organized monopoly. It is a fallacy to say, as .ASC.^P has repeatedly said, that it is none of radio’s business where its money goes or how it is divided among writers. The only way to encourage creation of music is to pay for it, and the only way to do that is to see that the money which radio pays for music gets into the hands of the people who create it.” Mr. Kaye pointed out that BMI, during its first year of activity, during which it had acquired offices, fixtures, furniture, catalogues and other permanent assets, had spent $1,800,000, or less than ASCAP spends annually on the mere administrative duty of col¬ lecting license fees and paying them out again. He pointed out that BMI's income from license fees for its second year was in excess of $2,000,000. “It is perfectly obvious,” he said, “that we can do the same job for less money during the second year than we did it during the first year. We do not have the same capital investments to make nr the same emergency situation to face on time limit. BMI will be able to continue an undiminished service to you at a substantial decrease in the rates you pay. The reductions of 33J^% which can be made in your present contract will mean that our rates will commence from 1% and will range up to 1^3%, dependent upon station revenue. This means that BMI can do its full job for the coming year at approximately $1,400,000, a rebate to the broadcasting industry of approximately $600,000.” Mr. Kaye also reported on the per program basis of paymenf which, unlike ASCAP's. involves no guaranties. Per program rates for BMI music range from 37c to 5;^% on commercial pro¬ grams which use BMI music and from ^2% to 1% on sustaining programs. “I am almost afraid to mention these rates to you for fear that someone will think we are depreciating the value of our catalogue or thinking of cheapening our service, but that is what can be done when there is no exaggerated overhead, and no desire to fix prices on anything but a competitive and economic basis, doing full justice to authorship.” Mr. Kaye pointed out the necessity of maintaining BMI as a May 23, 1941 — 439