The House Judiciary Committee’s Subcommittee on Courts, The Internet and Intellectual Property passed H.R. 4789, the Performance Rights Act, on a voice vote. The bill, as currently written, limits royalties to $5,000 a year for stations making less than $1.25 million in revenue annually, while major companies such as Clear Channel could end up paying millions.

Although radio does pay royalties to music publishers and songwriters, stations do not pay royalties for the actual music they play. Congress has considered this issue three times during the last half of the 20th century, each time deciding that there is a trade-off in the radio / music industry relationship where artists and their labels receive free promotion when their songs are played.

The fight to pass this bill is shaping up to be one helluva fight between the recording industry and the radio biz with both sides slinging the rhetoric far and near in hopes of capturing the hearts and minds of lawmakers as well as the public.

“All other music platforms – satellite radio, Internet webcasts, and cable television music stations – pay artists and musicians to use their music. It’s only fair that terrestrial radio be held to the same standards,” said musicFIRST Coalition Executive Director Doyle Bartlett.

“Today’s vote comes as a complete non-surprise, given the House IP Subcommittee’s history of support for the RIAA-backed tax on local radio stations,” said National Association of Broadcasters Executive VP Dennis Wharton. “Despite today’s action, there remains broad bipartisan resistance to the RIAA tax from embers of Congress who question whether a punitive fee on America’s hometown radio stations should be used to bail out the failing business model of foreign-owned record labels.”