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Day of Silence On the Internet
Posted by
kdawson
on Tue Jun 26, 2007 02:14 PM
from the silence-speaks-louder-than-tracks dept.
from the silence-speaks-louder-than-tracks dept.
A number of readers sent in stories about Net radio going dark for a day. Not all of it, but according to the Globe and Mail at least 45 stations representing thousands of channels. The stations are protesting a ruling establishing royalty rates that will put most of them out of business on July 15. "The ruling... is expected to cost large webcasters such as Yahoo and Real Networks millions of dollars, drive smaller websites like Pandora.com and Live365.com out of business and leave a large chunk of the 72 million Net radio listeners in the dark." SaveNetRadio has a page where US residents can locate their senators and representatives to call them today.
Related Stories
[+]
New Royalty Rates Could Kill Internet Radio 273 comments
FlatCatInASlatVat writes "Kurt Hanson's Radio Internet Newsletter has an analysis of the new royalty rates for Internet Radio announced by the US Copyright Office. The decision is likely to put most internet radio stations out of business by making the cost of broadcasting much higher than revenues. From the article: 'The Copyright Royalty Board is rejecting all of the arguments made by Webcasters and instead adopting the "per play" rate proposal put forth by SoundExchange (a digital music fee collection body created by the RIAA)...[The] math suggests that the royalty rate decision — for the performance alone, not even including composers' royalties! — is in the in the ballpark of 100% or more of total revenues.'"
[+]
Technology: A Reprieve for Internet Radio 108 comments
westlake writes "In the wake of Internet Radio's Day of Silence, SoundExchange has proposed a temporary $2500 cap on advance payments 'per channel/per station.' The Digital Music Association responded immediately in its own press release that it would agree to this, but only if the term for the new arrangement were extended to 2010 — or, preferably, forever. On another front, SoundExchange seems aware in its PR that it will have to concede something more to the non-profit webcaster, if it is to avoid Congressional action."
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I too... (Score:5, Funny)
It's not going so well so far... argg... must... stop... posting...
The people, united... (Score:5, Funny)
Parent
How about a day of EXPLANATION?!?! (Score:2, Insightful)
Is this the result of a ruling, a law, or a company decision? Who exactly has to pay and who doesn't? What do they have to pay? Why do they have to pay it? To whom do they pay it, and why them? Where they paying before? Is it a matter of amount or are they challenging having to pay a
Re:How about a day of EXPLANATION?!?! (Score:5, Informative)
The Copyright Royalties Board recently (March 2, 2007) enacted new regulations which increase the "royalties" owed by internet broadcasters; instead of paying
From what I understand, the "per song streamed" is calculated not by just how many songs you broadcast, but also how many listeners you had for each particular song. So if 10 people listened to a 30 Seconds From Mars track, it would count as 10 songs, not 1.
Who gets the money? SoundExchange. Under such protest, the generously offered webcasters the gracious offer of being able to pay the reduced rates for a little longer than originally scheduled. How nice of them!
Basically it boils down to the fact that terrestrial broadcasters pay no royalties whatsoever to the recording companies, but the recording industry wants to extort as much money as they can from the internet music business. Which, in turn, will most likely drive most internet radio out of the game.
Parent
Re:How about a day of EXPLANATION?!?! (Score:5, Interesting)
One thing I don't understand is why the terrestrial broadcasters don't pay royalties in the US. AFAIK then do in most other counties. They certainly do in the UK. Anyone know?
Parent
Re:How about a day of EXPLANATION?!?! (Score:5, Informative)
So much so that there have been many, many "payola" scandals, including in the past year, where the broadcasters are paid kickbacks (through tickets, cash, gifts) to play particular songs and artists.
The fact that this system would probably work out for the music industry when it comes to internet music is being ignored -- as has long been noted here on slashdot.
Parent
Re: (Score:3, Informative)
Running a net station means reaching fewer people and paying more per listener.
Having more net stations helps ensure a roughly equivalent user base to terrestrial.
I like the "hard to apply payola" theory.
They probably just want less choices on the internet.
I'm sure getting royalties that they don't deserve:
http://www.dailykos.com/story/2007/4/24/141326/870 [dailykos.com]
doesn't hurt either.
Re: (Score:3, Informative)
The basic reasoning behind this is that it is a mutually beneficial situation where airplay increases record sales for the label and tour attendance for the artists.
Re:How about a day of EXPLANATION?!?! (Score:5, Interesting)
I have a feeling that the NAB (National Association of Broadcasters) that represent terrestrial radio is partially behind this. Recently, they've seen competition increase significantly with MP3 players like the iPod, satellite radio, and Internet radio. The NAB is already trying to limit their competition by lobbying against the merger of the satellite radio companies, Sirius and XM, which are both taking massive losses. I wouldn't be surprised if they're behind an attempt to kill Internet radio.
I don't know about you guys, but I've completely stopped listening to regular radio. To me, regular radio has degenerated into commercials and the same 10 songs in repeat. Now I listen to my iPod on my commute to work. I'm very sure that many people are doing the same.
Parent
Re:How about a day of EXPLANATION?!?! (Score:4, Interesting)
Parent
Re: (Score:3, Insightful)
For the record, groups I've found because of them, that I recommend: Sigur Ros, Mogwai, Electralane, Raspu
Re: (Score:3, Interesting)
What if I write, perform, and record my own music? Can I make that available to the internet radio stations on my own more favorable terms (assuming it might be good enough for them to like, which is probably stretching a rubber band to the moon). Or do I have to use this Copyright Royalties Board rule? Do artists have to use the CRB or is that just a general choice made by the corporations that so many artists have signed their soul over to?
What about having internet radio playing indie music instead?
Re:How about a day of EXPLANATION?!?! (Score:5, Insightful)
Not sure if it is or not, but it is perfectly possible for copyright holders to bypass SoundExchange and negotiate (lower) royalty rates directly with the Internet Radio stations.
And that, friends, is ultimately the solution. If Internet Radio stations would just drop music that hasn't been made available to them at reasonable, practical, rates then (a) they'll continue to survive and (b) SoundExchange will need to review its rates or face oblivion. The only way it would benefit SoundExchange and its members to continue to charge high rates is if they don't want their music played on Internet Radio stations at all.
The real question here is why the various groups representing Internet Radio aren't doing this.
Parent
Re:How about a day of EXPLANATION?!?! (Score:4, Insightful)
Internet Radio.. Well, I'm sure that there's a few million pretty eclectically oriented people out there that'll match your music tastes exactly.. Maybe just a few tens of thousands in the world.. But that's enough to keep a small radio station going.
Who knows, that could slowly grow to be the next "Popular Music" in time. Every popular 'Formula' expires in time. Then it's up for grabs who engineers the next one.
Given enough groups of 'eclectic', small stations that serve a few tens of thousands, there's a good chance that one of those will hit the next 'magic formula' that could well knock the current record labels on their behinds. Stuck on the outside of the next "Rock and Roll" as the younger business model steam rollers them into history.
And being as they're broadcasting on the net.. They can reach the world, not just a hundred miles or so from their broadcasting station.
Personally, I'm all for a small station that fits my needs.. I no longer listen to the 'big boys' as they just don't cater to what I like.. It'd be refreshing to hear new, good stuff rather than listen to my existing collection over and over again..
Parent
Re:How about a day of EXPLANATION?!?! (Score:5, Interesting)
Now here is my question. If you are not a SEx member, how the hell can they be collecting fees for your copyrighted works if they hold no copyright on your works? Something about this systems seems a bit screwed up.
Parent
Re:How about a day of EXPLANATION?!?! (Score:5, Informative)
That's the payoff that comes from being able to afford lobbying. This money, which isn't yours, gets channeled to you and unless someone pays a fee to you to be able to collect their money from you, you get to keep it. Win win! You can finance more lobbying, off of the backs of people who may disagree with your entire viewpoint, hence one possible reason why they're indy.
Gotta love how it all works, huh?
Parent
Re:How about a day of EXPLANATION?!?! (Score:5, Informative)
- A fee is levied to a broadcaster, per song per listener. The fee also increases every year (as far as I understand, there was a fee previously, but it is being increased).
- The fee is retroactive to January 2006, due immediately when the rate increases go into effect.
- There is a minimum fee of $500 per year.
Because of these changes (which are not applicable to terrestrial or satellite radio broadcasters), many webcasters will be forced to shut down on July 15 because they will not have the revenue to pay the new fees (ie. they will go bankrupt).Instead, the Internet Radio Equality Act [wikipedia.org] proposes a lower royalty fee (0.33 cents per hour per listener) or a revenue sharing agreement.
Parent
Re:How about a day of EXPLANATION?!?! (Score:4, Interesting)
Keep in mind that both XM and Sirius have contracts with the RIAA that requires them to pay a percentage of subscription fees. So no, they're not paying the same fee, but they do pay a significant fee.
Parent
Re:How about a day of EXPLANATION?!?! (Score:4, Informative)
Parent
Re: Ex-post facto (Score:3, Informative)
From the Cornell Law School Wex:
Ex post facto
Latin for "from a thing done afterward." Ex post facto is most typically used to refer to a law that applies retroactively, thereby criminalizing conduct that was legal when originally performed. Two clauses in the US Constitution prohibit ex post facto laws: Art 1, 9 [cornell.edu] and Art. 1 10 [cornell.edu]. see, e.g. Collins v. Youngblood, 497 US 37 (1990) and California Dep't of Corrections v. Morales, 514 US 499 (19
Here's the short, short version AFAICT (Score:5, Informative)
In the beginning. Prior to 1995, you could 'perform' music in public, via digital broadcasting, without paying any royalties on it. I'm a little fuzzy on exactly what you used to have to pay royalties for (Wikipedia says there was "no performance right" for artists, but that doesn't make a lot of sense, I remember performance-rights cases prior to '95; I think it was just a digital thing), but anyway, in 1995 Congress passed a law granting rightsholders control over the digital 'performance' of their works. The upshot of this was that anyone distributing music digitally now had to pay 'performance' royalties for it.
Obviously, trying to pay royalties directly to the owner of each piece of music that you might play on a radio station would be problematic. It would require negotiating a license with each rightsholder, for each work, for every station. The paperwork and negotiations would be crippling. So a provision was made for so-called 'statutory licenses,' basically blanket licenses that you buy from an organization who takes the proceeds and divides them up among artists. (Blanket broadcast licenses like this aren't a new thing, but this extended them to digital broadcasting.) In return, you can play whatever you want, without worrying about negotiating individual contracts. The cost and rate structure of these licenses is set, theoretically, by the U.S. Copyright Office.
Enter SoundExchange. The RIAA [1] has a division/subsidiary/department-of-evil called "SoundExchange", which is designated, by the U.S. Copyright Office, as the sole supplier of "statutory licenses" for digital music. So if you wanted to run an internet radio station or other digital broadcast, and weren't going to stick to just playing independent artists who have relinquished some of their rights to public performance, you needed to go to SoundExchange and buy a license. While philosophically objectionable to many (including many artists!) because of the metrics they use to distribute the fees, SoundExchange had licensing terms that weren't horrific, including some that were based on a percentage-of-revenue (I've heard 10-13% quoted). So if you were running a small-time internet radio station, the fees wouldn't break the bank. This has been the status quo for a while now.
The Rubber Stamp. The current controversy started a while back, when SoundExchange proposed, and the Copyright Office approved, a dramatic rate hike. Among other things, the new rates eliminated the percent-of-revenue model, replacing it instead with a per-song-per-listener model, combined with a minimum per-channel fee, and a bunch of other onerous terms (including making the fees retroactive to some point in the past, which would instantly force any station without large cash reserves out of existence). The bottom line was that under the new fees, most small internet radio stations -- particularly those who have lots of channels tailored to particular musical tastes or genres -- just wouldn't be able to pay the bills. The effect as far as I can tell, would be to make Internet radio much like terrestrial broadcast radio: dominated by a few corporate-backed players (e.g., Last.fm), with a small number of channels playing basically the same thing. The new rates, if nothing happens to forestall them, go into effect around the middle of next month.
[1] Okay, allegedly it's "independent" now. Riiight...
Parent
Re: (Score:3, Insightful)
This sucks. (Score:5, Insightful)
Re: (Score:2, Insightful)
While I sympathize with you, you don't exactly have the rights to listen to music for free unless the copyright holder gives it to you. If you don't like it, you can get back at them by not pay
Non-American listeners? (Score:3, Interesting)
Thanks.
Re: (Score:3, Insightful)
Re: (Score:3, Interesting)
I received this yesterday:
"Dear Dr. XXXX:
This letter acknowledges receipt of your communication about internet radio.
The Copyright Royalty Board (CRB) recently announced new statutory royalty rates for certain digital transmissions of sound recordings for the period January 1, 2006, through December 31, 2010. Implementation of these new rates marks the expiration of a previous royalty rate agreement specifically designed to benefit "small" web casters.
I support an artist's right to be
Re: (Score:2, Informative)
To start the ball rolling...
www.planetrock.com (UK) Playing some Genesis as I write this. (June is Genesis Month)
www.bbc.co.uk/radio and select your station
If the USA conglomerates are so determined to cut their own throat then so be it. These companies do need to understand that the internet allows us to listen to broadcasters from all over the world. Shutting down US based stations
Re:No taxation without representation. (Score:4, Insightful)
Parent
Just a day? (Score:2)
I dont really use online radio, but if I did I wouldn't miss it for a day.
We need more days like this... (Score:4, Funny)
One day? (Score:2)
Re: (Score:3, Insightful)
Except that this day of silence is to draw attention to the issue, much like the read people stop buying gas for a day. Has nothing or at least, very little to do with making them lower their prices. This will make a lot of people aware that the net radio stations are being extorted, a few of those people will be driven to do something about it that otherwise were unaware. If even a thousand people write to their congress critters about the issue, considering 72 million listeners that seems like a reasonabl
KUOW is joining in (Score:2)
It will just go underground.. (Score:4, Insightful)
OR
use an SSL tunnel to a server in a country without those laws.
I wonder what they do to Net radio stations with "ALL TALK" or ALL News" format?
Damned stupid over-bribed politicians.
Close to the business. (Score:4, Interesting)
He can afford paying the royalties, if he must. The smaller shops will pay about the same.
Here are the issues as he pointed out.
1. He is going to have to pay 10x what he would have in the past.
2. The artists don't even know the cut they are going to get.
2a. The artists are beginning to catch on.
move outside the US (Score:3, Interesting)
In Soviet Russia (Score:5, Funny)
I know I know, I can't believe I just posted that, I also can't believe it's not butter.
Congress People (Mine? Hrmph) (Score:5, Informative)
Interesting Strategy (Score:3, Interesting)
It seems to me that they do not care about sustaining the revenues from these small operators, merely getting them hit out of the market completely. Not because they think its logical and valid but because these small stations allow for a lot more EXPOSURE to different musics. The Recording industry seems to be heart-set on controlling the united states listener market, indoctrinating them into their current "top 40 for your genre of choice" way of thinking. By keeping the royalties as a per-channel issue, the more styles people try to put out there, they have a direct incentive not to diversify. This allows the usual gang (CC, etc) to keep control of what music people are being exposed to.
How often to people buy cd's of bands they dont know? and if they manage to kill Fair-Use by the end of the day, they'll have it enforceably illegal to share with friends (in a MAFIAA perfect world).
Then all thats left is to mass produce more of the same crap, ensure its all the target market is exposed to, and guaranteeing revenue without need for unimportant points like "taste" or "quality". Seems to me the RIAA is slowly giving up on affecting the world and are instead trying to create a fortress out of the USA.
My Congressman's Response (Score:4, Interesting)
" Thank you for contacting me regarding H.R. 2060, the Internet Radio Equality Act. I appreciate hearing from you on this important, and I am pleased to tell you that I am a cosponsor of this bill.
As you know, on March 2, 2007, the Copyright Royalty Board (CRB) dramatically raised the performance royalty rates for webcasters. The CRB eliminated the percentage of revenue fee that many small webcasters used to determine their performance royalty. The move from a percentage of revenue to a per-song rate hits small webcasters the hardest. Royalty rates would increase over 300% for the largest webcasters and as much as 1200% for the smallest webcasters. This kind of rate hike would mean the end of many Internet radio stations that would not be able to stay in business under the crushing new royalty rates. Therefore, I have cosponsored H.R. 2060, the Internet Radio Equality Act. This bill would render the CRB ruling ineffective and would reinstate the percentage of revenue royalty payments. This bill has referred to the U.S. House Committee on Energy and Commerce and the Committee on Judiciary.
Thank you for contacting me about this important issue. I will continue to be a strong voice for you in Washington.
Sincerely,
Mike McIntyre
Member of Congress"
Re:ahem (Score:5, Funny)
Parent
Re:No effect (Score:4, Informative)
Then how come I get the following message if I try to listen to any stream?
" LAUNCHcast Is Off the Air - It's a Day of Silence
LAUNCHcast Radio and other webcasters are silent today, from
12 midnight EST to 11:59 pm EST. A recent COPYRIGHT ROYALTY decision will impose punishing fees that could shut down most online radio.
You can do something about it. Go to www.savenetradio.org to find out more, and call your congressional representative before JULY 15th.
Today is only one day of silence -- but if you don't speak up, this could be the only sound we'll hear from online radio. "
Looks like involvement to me...
Parent
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Re: (Score:2, Insightful)
The local stations may not care or may even be supportive of the bans seeing as internet radio competes with them.
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and, AFAICT, they are exempt from these new rules. they get to stay with the same rules as they currently have with terrestrial radio, so they get to have their current market and keep the new market all to themselves.
then again, i could be wrong, so someone please correct me if i am.
Re:Play independent music (Score:5, Informative)
Parent
Re:Play independent music (Score:5, Interesting)
Parent
Re:Play independent music (Score:5, Informative)
It's called a compulsory license, and it's a pretty well-understood legal structure. Interestingly, this is what makes allofmp3.com legal in Russia. The terms are just different.
The goal is to make it easier for broadcasters to secure rights to the material they're broadcasting, as they can choose to make use of the compulsory license, rather than negotiating a deal with each artist individually. This is, of course, assuming the fees are fair. And note, this doesn't preclude broadcasters from securing rights from the artists themselves... it's just a pain in the ass.
If they are collecting money for bands that aren't even affiliated with them, then they aren't giving these bands any money either, so basically they are just taking money
a) The bands are "affiliated" with them because the government chose SoundExchange as the arbiter of the royalties. Complain to the CRB if you don't like that.
b) The bands are free to secure their royalties from SoundExchange at any point. The CRB website has links to the necessary forms, IIRC.
However, if I sing "jingle bells" on air, will they now require that I pay them?
If the song is under valid copyright, yes, unless you've secured rights from the copyright holder directly.
What about the opening musical jingle to my radio talk show?
Presumably you've already secured rights.
What about if I'm a band and I let my fans stream my songs from my website for free?
Well, you own the copyright in that case, don't you? So you're free to do what you wish with the material.
In the end, compulsory licensing, as a concept is a very very good idea. Assuming reasonable royalties, it reduces overall costs for broadcasters, since they only end up dealing with a single entity.
The problem comes in when the CRB and SoundExchange agree to modify the rates in a fashion which is clearly discriminatory. In this case, it seems pretty clear that SE is acting in the interests of the entrenched music oligopoly. And the CRB has apparently chosen to kowtow to those same interests.
Parent
Re: (Score:3, Interesting)
Why? Because WREK streams to the internet as well as using its website to host archives of the past week's music. Missed the Hour of Slack or dozed off during your favorite techno show? No problem, it's waiting for you! It's not even different from the terrestrial radio; just packaged a little nicer for your PC.
How does forcing collegiate radio to pay excessive royalty rates help ANYBODY but these SoundExcha