New Net Radio Rates

[Neal Pomea]

The entire "problem" revolves around the erroneous assumption that web stream radio tranmissions are a music delivery system, as in everyone who listens is using the system to download and store music, which led to rules where station's can't play more than four selections by a featured artist in a three hour period, post their playlists in advance, or otherwise do what radio has always done. And now the station's are being charged as if everyone who listens is actually a buyer. The "recording industry" has been trying to do this at least since cassette tapes ...

I agree. Capturing the streaming audio via Internet is comparable to a listener capturing a radio broadcast on cassette. I am surprised by the arrogance of the CPR board to not even hold hearings, certain that they are in the right about this. They are just plain wrong, IMO.

[Lazaro Vega]

The only recourse now is to write your congressmen. Sound Exchange is. They have e-mail alerts set up on their site and are trying to convince people to send out e-mail blasts. This grass roots messaging does work.

[ghost of miles]

I think one of the House co-sponsors of the bill Clem refers to above is the rep from my district (Baron Hill-D):

Internet Radio Equality Act

Edited May 3, 2007 by ghost of miles

[Lazaro Vega]

Cut n paste or click on the following link to petition your congressional

representative to lower the proposed high cost of streaming royalties that

will make it difficult for many smaller radio stations and other web

streamers to continue with their streaming in the future.

http://www.kcrw.com/music/music-royalty-rates

[ghost of miles]

It's not looking good. And it may not just be streaming that's affected--we may have to pull the Night Lights archive offline if there's no resolution for public radio by the end of the week. (OTOH we may just barely slide under the new "cap".) But small webcasters are going to be absolutely devastated by this. The RIAA and SoundExchange are going to kill the goose that laid the golden egg, etc. (And there's another HUGE issue coming down the pike for commercial radio--the attempt to start charging performance royalty fees for each play of a recording.)

Lazaro, what's the word up at Blue Lake?

[ghost of miles]

The ironic thing is that Clear Channel's streaming will possibly survive, and NPR's might as well.. but guys like the country-juke broadcaster over at AAJ are out of business. Anybody who tries to set up a small radio show online is probably putting his/her fiscal life at risk if the RIAA and SoundExchange get wind of it... is there any way we can starve those guys to death?

[JSngry]

This only for America, right? So what's to keep netcasts from popping up all over the globe, and what's to keep americans from getting their progamming placed there?

[Lazaro Vega]

Ghost,

Paying a $500 a year fee won't put us out of business, and our stream is capped at 75 listeners or so. As an established small stream this should not kill us -- the new rules as I was reading them a month ago are more costly to web casters with huge audiences.

Has something changed?

[Shawn]

Noncommercial webcasters playing LESS than 159,140 aggregate tuning hours

per month (less than approximately 221 listeners in any given hour) are only

required to make the minimum $500 payment.

Now, if we're talking an average of 20-50 listeners at night to a jazz or other "under the radar" style of music...then those stations can still grow to 4 times their current size and still fall into the 500 per year payment.

In fact, that's maybe the ticket. Get a coalition going amongst internet radio, set up sites but cap the transmission to not allow more than minimum to stay under the $500 cap. That's how you starve the fuckers...don't let them collect their big fat fees...nickel and dime them to death. Of course this might be fantasy...but I'd give it a shot if I was running an internet radio station.

in addition...

There is no earthly reason why internet radio should pay a cent more than regular on air stations. It's just plain fucking OBSCENE! The record labels have NEVER had a clue about what just MIGHT be good for them.

Edited July 11, 2007 by Shawn

[Lazaro Vega]

Right. And, when we have to follow the rules for web streaming we're sticking it to the FM audience. That is our FM audience has been fed a steady diet of traditional jazz features for more than 20 years -- each hour contains about 20 minutes of historical jazz, or at least recordings by a single artist (tonight is Tomasz Stanko), which the DMCA disallows. That law says only 4 selections by the same artist in a three hour period. You can get a waiver of those rules, and we have, yet the majors won't sign off. So, for the 25 people listening on-line we are expected to follow those limitations? Bass ackwards.

[mgraham333]

Concord Radio is on the web. I wonder if it will last.

[Lazaro Vega]

This just came across the Jazz Programmer's List:

(Quote)

Some news recently announced....this is apparently true so good news for webcasters.

At today's Congressional hearing...... SoundExchange, which was scheduled to receive the new royalty payments on Monday morning (since the enforcement date falls on a Sunday), made a startling statement.

The SoundExchange executive [Jon Simson, executive director] promised -- in front of Congress -- that SoundExchange will not enforce the new royalty rates. Webcasters will stay online, as new rates are hammered out.

Tim Westergren expressed relief that Pandora wouldn't have to shut down on Sunday in response to the new rates. He said, "It was getting pretty close. I always had underlying optimism that sanity was going to prevail, but I was beginning to wonder."

He said everyone who called their Congress person about this should feel that they had an effect on the process: "This is a direct result of lobbying pressure, so if anyone thinks their call didn't matter, it did. That's why this is happening." The flyer DiMA distributed to Congress today probably helped a bit too, but overall, it appears Congress intervened due to pressure from web radio listeners.

-----

Update: Another source -- close to the situation although not inside today's closed-door hearing -- confirmed the following: Pandora was there; "progress was made"; the minimum fees are indeed off the table; and SoundExchange and the webcasters that were part of the Copyright Royalty Board hearings are going to have another chat about the rates.

However, the source said the big question right now is whether webcasters not part of the CRB hearing might still have to pay the rates set by the board, minus the minimum fees.

Basically, this news qualifies as a reprieve, but internet radio won't be truly saved until negotiations result in a workable royalty rate.

Another Update: This story has been confirmed by Kurt Hanson of RAIN.

-----

Westergren had more to say, lending insight into a process that was largely opaque to non-participants. Apparently, the per-channel minimum fees mandated by the Copyright Royalty Board were never taken very seriously by those involved. They've now been taken off the table completely, saving Pandora, Live365, and other multicasters from their most imminent threat. Instead, per-station minimums will be capped at $50,000 per year.

"No one thought those per station fees were remotely rational. It only makes sense that they're being taken off the table."

As for the Copyright Royalty Board? They're entirely cut out of the process, having set the rates and then refused a rehearing. Going forward without the royalties being collected, SoundExchange and webcasters will negotiate a new royalty rate with Congress looking over their shoulder -- "and last but not least, the public looking over Congress's shoulder." Alternatively, Congress now has time to consider the Internet Radio Equality Act, which would set webcaster royalties at 7.5 percent of revenue and allow them to continue operating pretty much as they have been.

Either way, this is a big win for webcasters and their listeners. Again, this is a reprieve, and internet radio can't be considered saved until new rates are set that everyone can live with.