In the news recently is a story, apparently breaking on the technology blog ArsTechnica, suggesting that Congress may soon consider the question of whether or not cell phone manufacturers should be required to include FM radios in all of their devices.¹  Required, as in, Congress is going to pass a law making FM radio receivers mandatory.  Even for this current Congress, where payoffs, bribery, and corruption runs rampant, this entire move is somewhat incredible.

As I understand the story right now, the FM radio mandate is part of a proposed compromise between two special interest groups lobbying hard in Washington over the relatively obscure issue of broadcast radio royalties.  Under current copyright law, radio broadcasters are only required to pay performance royalties to songwriters, not to artists or recording labels, but internet radio broadcasters are required to pay all three.  Suffice it to say, internet radio broadcasters don’t like this scheme because it places them at a competitive disadvantage, and the recording labels and artists don’t like this scheme because they don’t get paid.  Both groups have been lobbying hard in Congress to change the law to force broadcast radio to pay all three royalties; broadcast radio, of course, prefers the current system.

Congress, being Congress, is apparently considering doing what it does best:  Bailing out special interests with payoffs using our money.

In this case, the scheme involves mandating FM radios in cell phones.  Under the deal, broadcast radio would need to pick up the tab for all three royalties, up to a certain monetary cap.  In exchange, Congress will mandate that FM radio receivers be placed in portable devices including cell phones, presumably along with MP3 players and their ilk as well.  In this way, the artists and labels get their money and FM radio gets receivers in more places which should increase the number of listeners.  Everybody wins.

Everybody, that is, except for people who want to buy one of these devices.

It should go without saying that FM receivers don’t come free.  There’s circuitry involved, an antenna, and given the digital nature of most portable electronics, software to be written as well.  It’s difficult to say how much money it would cost to add FM radios to cell phones, but it’s clear from the overwhelming lack of FM-enabled phones that, whatever it costs, it’s more than people would be willing to pay.  But, with a congressional mandate, the people wouldn’t be left with a choice.  Manufacturers will pass along those costs, and consumers will still need to buy cell phones.

The good news is that this so-called compromise appears to still be pretty far away from making its way into law.  For the love of free markets, I hope it stays that way.

1. Ars, so far, appears to be the only one with this story, with other sources around the Internet simply referring back to their article.  As someone who follows their blog, I have generally found their technology-related writing to be accurate, so I’m inclined to believe that their post reflects something that is actually happening.  Even so, the lack of other sources is worth noting. [↩]

Tags: free markets