This situation is clearly something that few understand. We have two different aspects of copyright here On one hand we have ASCAP and BMI as well as Harry Fox Agency who have responsibilities to handle the income from radio play on behalf of their member songwriters and their publishers.
However due to an exemption granted by US Congress around 1937 terrestrial radio was granted a limited reprieve from paying the owners of the sound recordings (not publishers, who get paid) any royalties in order to build their broadcasting networks. You would think that by now they have built them after almost 80 years?
To add insult to injury, because this ruling prevents foreign copyright owners from collecting any performance royalties from their material being broadcast by US radio, these countries around the world reciprocate and deny US owners of sound recordings any income from music they own that gets played on radio stations around the globe, which unlike the US typically do pay sound recording owners for the use of this material.
Clearly, most if not all radio stations around the rest of the world do pay sound recording owners for use of songs in their catalogs, and still manage to thrive.
But the lobbying power of the NAB (National broadcasters' association) and the dizzying amounts of money they've spent spreading FUD on making US radio like the rest of the world would be the death of them -> the famous campaign "The Day They Killed The Music" which should really be renamed "The Day They Killed Fat Corporate Profits To Radio Mega-Conglomerates".
Because even though terrestrial stations across the entire planet have managed to thrive and survive while paying such fees to sound recording owners for all of these years, somehow in the US enacting this legislation would make them die off. Well, one thing for sure: they'd make less profits because they would have to share some of the income with the very people who created the sound recordings; yes, those that they have gotten in the habit of using for free.
It used to be that "one hand washes the other" because radio play ensured such massive sales that those who got their music played reaped a huge windfall in record sales. So it was tolerated, and no one in their right frame of mind would have dared challenge this. But now that record sales are down to a trickle of their former glory, it's looking as if the exemption has run its course and it doesn't make sense anymore to let radio stations benefit from this anachronistic advantage that hurts sound recording owners doubly by also denying them income from play of their masters overseas.
Again: sound recordings, not the musical compositions themselves nor the publishers who represent the interest of those who wrote them.
Lastly, a few years ago terrestrial radio was obviously quite keen on forcing Internet radio startups (unwanted competition) to pay these royalties to sound recording owners they themselves are exempt from. Surely they could anticipate that by doing this, someone was going to eventually challenge their hegemony, and call for fairness across the whole spectrum of broadcasters. Classic case of pot calling the kettle back.
They've gotten away with it for so long, and built empires from this exemption. It's time for this anachronistic advantage to be erased. One thing we can be sure: they'd rather spend billions making sure it never turns into law rather than spending the same paying it to the owners of the sound recordings whose catalogs they built their business model around, by using them for free for so many decades.