SoundExchange Talks to Webcasters About a New Royalty Plan
July 16, 2007 5:04 PM
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SoundExchange puts a stop on its royalty hike and decides to hash a new plan with webcasters
Several days ago,
online radio industry was about to meet its end
when the D.C. Circuit Court of Appeals declined to put a stop on a new royalty scheme. Championed by SoundExchange, the new royalty scheme increases money flow for artists and labels.
Despite the court decision to go ahead with the new scheme,
SoundExchange announced the new royalty scheme will be postponed
, without any indication it will be continued. According to SoundExchange Executive Director Jon Simson, the group is in debate with online radio stations on an alternative plan, one that will allow them to continue their operation while compensating artists and labels.
The outcry by online radio stations was heard several weeks ago when a large
number of stations banded together to protest against SoundExchang
e. While the government in large ignored the complaints, SoundExchange did listen -- even though it was the last entity on any stations' mind that would listen.
Pandora, one of the four largest online radio companies was one of many stations that took a stance against SoundExchange. Pandora founder Tim Westergren said users who called into Congress to voice against the changes all helped.
"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," said Westergren in a blog on
SoundExchange said it will now work closely with webcasters, large and small to form a new plan.
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RE: A Miracle? I think not.
7/17/2007 2:14:02 PM
Couldn't agree with you more.
Fact of the matter is:
1.) They were greedy.
2.) They bluffed.
3.) Internet radio stations called their bluff.
4.) They caved.
Although they state they're going to work on a new plan to create a "fair compensation" for artists represented, the truth is that this is clearly a case of "what the market was willing to bear".
They have absolutely no negotiating power whatsoever now - either they accomodate the current profits they recieve from this industry, or they destroy the industry. I only wish this scenario could be replicated in the fight on-going between the RAB and similar greed-driven representation groups.
"Google fired a shot heard 'round the world, and now a second American company has answered the call to defend the rights of the Chinese people." -- Rep. Christopher H. Smith (R-N.J.)
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