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A decision by the Copyright Royalty Board is likely to shut down smaller radio stations

Internet radio broadcasters suffered a setback after copyright judges on the Copyright Royalty Board denied requests by public and private broadcasters to reconsider a recent ruling that increased royalties to musicians and record companies.

The group of radio broadcasters includes radio stations, National Public Radio, small startup companies and online sites such as Yahoo, all of whom have objected to the royalty increase that took place on March 2.  The panel of copyright judges also upheld a May 15 date in which all new royalties will be collected.  While the new royalties are still about a month away, many smaller radio stations have already started to feel the squeeze.

Starting in 2008, webcasters will have to begin paying royalties based on a per-song, per-listener basis.  Furthermore, traditional radio stations that stream programming on the Internet will have to pay online rates along with normal payments for broadcasting over-the-air -- a move that could force larger corporations to change the way they do business.

The new rates  by the CRB are likely to shut down smaller Internet radio stations, according to analysts.  Before the ruling, it was possible for small webcasters and public radio stations to pay a flat fee that ranged close to 12 percent from revenue in royalties.

It is likely that companies and radio stations will again file objections against the ruling by the CRB.

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?
By alifbaa on 4/18/2007 12:19:38 PM , Rating: 3
How does raising fees such that many broadcasters stop broadcasting help increase profits? It sounds like they are not being reasonable.




RE: ?
By Talic on 4/18/2007 12:46:08 PM , Rating: 2
Yeah its stupid, but right now you can listen to radio for free. The stations can work with just donations and sometimes without any commercials.

I'm personally dreading the day when this comes into effect, I don't know about you guys but I find one of the great things about the internet is radio stations that don't have commercials.

Greed is such a horrible thing.


RE: ?
By feraltoad on 4/18/2007 10:56:44 PM , Rating: 2
ME pay for "pay for play"? Like hell.


RE: ?
By Scorpion on 4/18/2007 12:47:51 PM , Rating: 2
Of course not. How many times do the media companies appear to make reasonable judgments regarding copyright or licensing? These decisions ensure that only the large conglomerates survive and the little guys get squeezed out, which is precisely opposite from what I would prefer.

It stifles niche markets and new innovation, which in essence reduces truly creative competition. I could only image where we'd be now if such restrictive laws existed in the last century and were as enforceable as they are now.

Eventually someone is going to have to get away with circumventing the rules for the "next big thing" to come along and be gobbled up by the mainstream entertainment machine.


RE: ?
By Scorpion on 4/18/2007 12:56:37 PM , Rating: 5
What I don't get is how one institution can accept royalties for everyone. What about stations like DI.fm? A large portion of their music comes from independent labels and foreign labels which are not represented by the RIAA et. al. Where do the royalties go for this music when they are paid to the CRB? Into the pockets of the lobbying and oversight groups? Or is a disproportionate amount eventually given to the original labels of this music? What about unlicensed music? There's so many "what if"s that I don't know the answer to, but it doesn't seem like a truly fair system.

How are they able to set one fee that applies to every label? It seems that the station themselves should be allowed to negotiate the pricing with the labels associated with the music they play. That seems like the reasonable thing to me.


RE: ?
By AstroCreep on 4/18/2007 3:17:57 PM , Rating: 2
Come on man, this has to do with copywrites and the recording - they don't care about making money!


Pandora
By RyuDeshi on 4/18/2007 12:44:20 PM , Rating: 3
Does this effect Pandora?

I love that site!




RE: Pandora
By Vanilla Thunder on 4/18/2007 12:51:09 PM , Rating: 3
Pandora is a kick ass site, and I would hate to see this put the squeeze on them. I've stumbled across bands/artists that I would have never heard about if it weren't for Pandora. But I digress. Online radio/broadcasting is one of the few places where you can actually hear free form radio as it used to/should be. Every major broadcasting radio station is owned by one of four corporations that control everything you hear while you turn the dial. Choice is an illusion. So take the time to think about these smaller stations, and support them if you dig what they do.

Vanilla


If done right this can kill the RIAA
By Mitch101 on 4/18/2007 2:21:55 PM , Rating: 2
If done right this can kill the RIAA.

The solution should be to use bands that currently do not have contracts with large media companies. This helps the garage bands and frees them of the media giants who put a strangle hold on them.

We might discover new bands this way or more importantly we might find bands that you want to buy thier music instead of the crap the RIAA shoves down our throughts.

We might find that bands make the money instead of the music companies taking all the coin.

Bands might discover they can market their own media and make more money this way. If I recall the average artist doesnt make 5 cents on a downloaded song. If undiscovered bands were able to charge 10 cents a song they could make twice as much as todays artists who have sold thier soul or sell half as many to make just as much.

Undiscovered bands need an outlet for their music and it looks like Internet radio needs bands. This could be the biggest mistake the RIAA has made if the Internet radio stations capitalize on it. Heck they can do a mix one band we all know then several undiscovered.

Did you know one of the biggest money making bands is the Greatfull Dead and they encourage you to bring recording media to thier concerts?

This is the perfect opportunity to bite back the greed of the RIAA.




RE: If done right this can kill the RIAA
By oTAL (blog) on 4/19/2007 6:26:52 AM , Rating: 2
I agree with most of your post and I enjoyed the thought. However, there is one thing you have not taken into consideration. It is not cheap to professionally create music. It is a lot cheaper than it used to be, but it's still not cheap. Most bands sign a contract with a label that provide them with the resources they need to make a record. Yet, if you can further lower the price of making an album, I believe the internet model for music artists would be possible. You create the music and have your agent directly make the deals to sell it, and the money goes into all the right places instead of lining the pockets of people with no talent. I bet music would be better, more original, and less restricted.


By Mitch101 on 4/19/2007 9:31:24 AM , Rating: 2
Smaller recording studios could scout for the new talent and sign them even possibly selling thier product online similar to the way other services do it.

Plus there are some very good recording equipment for the PC today that a band could produce thier music pretty well today. Nothing wrong with live recordings as well which could be rebroadcast through internet radio.

This is a great opportunity for someone else to start doing the pushing around. Get internet radio to be something new instead of playing the same crap I can hear on the radio played every hour on the hour.


sounds like the end of somaFM
By RamarC on 4/18/2007 3:15:24 PM , Rating: 2
Dang I liked those guys... the only way I could hear some cool stuff (legally). But they've been struggling for a couple of years. This will surely do them in.

And the funny thing is, I don't think most of their listeners will subscribe to any site that conforms with these new rules. So I'll bet that the rules will actually reduce the overall royalty payments!




By DonkeyRhubarb on 4/18/2007 6:23:29 PM , Rating: 2
I really love Soma FM. Its the essence of what radio should be. I listen to it 24 / 7. I even have it as a widget in vista.

This is yet another step in commercialism taking over. Its so unfortunate that these stations that mean so much to a relative few cannot go on as they once were.

Artists lose royalties when they close, fans / listeners lose a great station.

The only winners are the royalty people. They have leveled the playing field so that only the big nobs can compete.

Im gonna listen to www.somafm.com every minute I can for the next while. I suggest you do too!


Regarding Pandora...
By pyrosity on 4/18/2007 3:22:10 PM , Rating: 3
I saw a couple of comments wondering how this might reflect Pandora, so here's some insight into that (and other similar Internet radio sites):

quote:
Hi, it's Tim from Pandora,

I'm writing today to ask for your help. The survival of Pandora and all of Internet radio is in jeopardy because of a recent decision by the Copyright Royalty Board in Washington, DC to almost triple the licensing fees for Internet radio sites like Pandora. The new royalty rates are irrationally high, more than four times what satellite radio pays and broadcast radio doesn't pay these at all. Left unchanged, these new royalties will kill every Internet radio site, including Pandora.

In response to these new and unfair fees, we have formed the SaveNetRadio Coalition, a group that includes listeners, artists, labels and webcasters. I hope that you will consider joining us.

Please sign our petition urging your Congressional representative to act to save Internet radio: http://capwiz.com/saveinternetradio/issues/alert/?...

Please feel free to forward this link/email to your friends - the more petitioners we can get, the better.

Understand that we are fully supportive of paying royalties to the artists whose music we play, and have done so since our inception. As a former touring musician myself, I'm no stranger to the challenges facing working musicians. The issue we have with the recent ruling is that it puts the cost of streaming far out of the range of ANY webcaster's business potential.

I hope you'll take just a few minutes to sign our petition - it WILL make a difference. As a young industry, we do not have the lobbying power of the RIAA. You, our listeners, are by far our biggest and most influential allies.

As always, and now more than ever, thank you for your support.

-Tim Westergren
(Pandora founder)


I received that email yesterday. Pretty scary stuff--I am very fond of Pandora and its services. To so drastically alter the copyright & royalties laws seems, from this perspective, thoroughly and completely unfair. In the very least a more staggered roll out of increases over a greater amount of time would be better.




*sigh*
By MadAd on 4/18/2007 4:43:47 PM , Rating: 2
Oh well thats intelligent- Not. Have they forgotten that the internet is global? Itll just drive programming overseas and boost pirate stations listenerhip.




By BladeVenom on 4/18/2007 5:57:22 PM , Rating: 2
I guess no one on the board or in the music industry has read The Goose That Laid the Golden Eggs.




My wife is gonna flip
By jlanders646 on 4/19/2007 3:03:06 AM , Rating: 2
All she listens to is internet radio at work, broadcasted locally from a very small but popular radio station.... She's gonna freak is she's gotta find another one! Oh well time for the free satellite radio that comes with my car subscription.




By kilkennycat on 4/18/2007 2:22:46 PM , Rating: 1
This ruling should drive a bunch of internet radio stations offshore to jurisdictions with a more fairminded interpretation of the law. Or at least until the copyright holders finally decide to behave in a fair-minded fashion themselves. Reminds me of the UK offshore pirate stations of the 60's and 70's. Hopefully the offshore locations are beefing up their internet infrastructures :-) :-)




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