Reprieve for Internet Radio

[OpenMike]

Reprieve on Royalty Increase Being Pursued for Internet Radio

By JEFF LEEDS
Published: July 14, 2007

Internet radio programmers who warned that a dispute over royalties could cause the death of their medium have received a stay.

A substantial increase in the royalties that online stations must pay for playing music was set to take effect tomorrow. But amid an outcry from online listeners and Congressional pressure, representatives for the recording industry indicated this week that they might not demand all the payments called for under the new royalty program, which was established in March by the federal Copyright Royalty Board.

Previously, Internet radio stations paid 0.0762 cent per play of each song, and small Webcasters, who generate little or no advertising, were charged based on a percentage of their revenue to relieve them of onerous royalty bills. But the new rate system eliminated that protection and called for the rate per play to more than double by 2010. It also required a separate fee of $500 a station, a potentially hefty charge for big Webcasters that offer thousands of customized stations.

In a new proposal disclosed yesterday, SoundExchange, an industry-backed organization that collects royalties for record labels and artists, said that it would agree to cap the minimum fee at $50,000 a year — if Webcasters provided more data about which songs they play and take steps to prevent listeners from using their computers to copy or store the radio streams.

But the two sides still disagree on other aspects of the new rates. Big Internet companies that offer online radio, including Yahoo and RealNetworks, had been battling the planned increase. National Public Radio, which streams music and other programming online, had also rallied listeners to protest the rates.

The reprieve came as federal lawmakers had begun discussing legislation that would enact reduced fees. But there had been no indication of when the legislation would come up for a vote.

The stations also lost a separate bid to delay or stop the new rates in court. A federal appeals panel this week declined to put off the rates — a decision that had appeared to seal the fate of Webcasters who worried that the royalty charges would put them out of business.

[skyvalleyradio]

here's the latest info on this issue:

http://www.wired.com/entertainment/musi ... face_music

while it seems to be a temporary reprieve, U.S. based webcasters still aren't breathing easy. In the past few weeks the SoundExchange & RIAA have done a number of "about-faces" and disseminated plenty of misinformation, so many are distrusting of any long-term truce between both sides of the issue