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60-Day Reprieve For Internet Royalty Rate Hike

Posted by kdawson on Thu May 03, 2007 08:58 AM
from the breathe-easier-then-mobilize dept.
Media Music The Almighty Buck
Chickan writes "The Copyright Royalty Board has officially posted its ruling on Internet royalty rates in the Federal Register. However, the organization has pushed back the due date for royalty payments to kick in from May 15 to July 15. The publication of this information also begins the official 30-day period for appeals. NPR is slated to file an appeal in this timeframe."
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[+] Your Rights Online: U.S. Court Denies Webcasters' Stay Petition 264 comments
Michael Manoochehri writes "Reuters reports that a "federal appeals court has denied a petition by U.S. Internet radio stations seeking to delay a royalty rate hike due July 15 they say could kill the fledgling industry." This royalty rate hike, put forth by the US Copyright Royalty Board, will increase royalty rates for webcast music tremendously, in some cases to more per year than many webcasters bring in from revenue. Save Net Radio, a coalition of webcasters, is telling listeners that "We are appealing to the millions of Internet radio listeners out there, the webcasters they support and the artists and labels we treasure to rise up and make your voices heard again before this vibrant medium is silenced.""
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  • The Rich get richer... (Score:5, Insightful)

    by Mockylock (1087585) on Thursday May 03 2007, @09:04AM (#18971849) Homepage
    If the appeal doesn't take hold, all the little guys will be forced out and the majority of stations will play NOT ONLY tons of advertisements, but also only popular music that brings mainstream listeners.

    If they base it on PROFIT gained by advertisements, rather than per song, per user... it will GREATLY improve the chances of smaller bands to be recognized. The only people benefitting are those grabbing the cash, and the already popular musicians and stations... the little guy will get pushed out.

    The majority of stations online aren't even making a lot of money, rather than entertaining a specific genre of music.

    Please, write your senators.

    • Turnabout is fair play (Score:5, Funny)

      by UbuntuDupe (970646) * on Thursday May 03 2007, @09:18AM (#18972027) Journal
      How about instead of rejecting the eventual return of royalties, we "support it", but keep extending the future date when they are supposed to start applying?

      You know, like Disney always seems to manage with copyright expiration.

      • Re:Turnabout is fair play (Score:4, Interesting)

        by SupermanX (1042838) on Thursday May 03 2007, @10:45AM (#18973531)
        Well, I think you have the right idea...
        However THIS is what I would suggest.

        Require RADIO to pay these fees as well, and remove any option for a negotiated deal with individual studios. Make everyone pay the same fees...

        Terrestrial Radio has a much bigger lobby, and if they had to pay similar fees, they would fight this every step of the way. This would force the established media to fight for the rights of the new media... because they have been lumped together.
    • Or maybe the stations can negotiate the deals directly with whatever artists are not signed up with major labels. Frankly, I no longer see the need for the labels altogether. It would costs the artist a few % to have a professional negotiate with the radio stations that want to play their music, but now they'd get at least the majority of the profit, versus virtually nothing, which is what they get right now.

    • Re:The Rich get richer... (Score:4, Interesting)

      by bishiraver (707931) on Thursday May 03 2007, @10:14AM (#18972977) Homepage
      Dude, I've purchased more music since listening to Pandora than I had in the previous four years. I've found some really interesting off-the-wall/radar artists with their service, and have spent approximately $130 in iTunes and amazon (via the pandora affiliate links so they get some c-c-c-cash) on their albums in the past 8 months. The RIAA gets their money, maybe, but I want my music. It's anecdotal, but it proves a certain point: internet radio helps people find obscure music; obscure but good music drives sales; sales make more money. In the long run, it will only be good for the music industry: too bad the RIAA is looking out for the suits who want to bolster the status quo this quarter instead of looking to what will make profits rain down six quarters or six years from now. Mainly because they're smelly old men who are only going to live for a few more years anyways, so who cares about future profits? GIMME MY LEAR JET NOW!

      • Re: (Score:2, Interesting)

        by Mockylock (1087585)
        The only reason I'm really concerned is that my friend actually runs a radio station that promotes local and upcoming bands. They send in music to them, they play NO profit gaining advertisements and send all of their extra CD's and gathered donations (posters, pictures, etc) to the troops.

        They ALSO have an air radio station that's low wattage that runs the same music around Pittsburgh.

        Now, if this appeal doesn't stop them.. My friend will have to pay an unGodly amount of money per month EVEN for music
        • I completely agree! I don't know of any online radio stations that promote local NYC bands, although I'm sure there are hundreds - I don't fall into the hipster crowd anyway, so it probably wouldn't matter ;) I'm just pointing out that my anecdotal experience turns the RIAA's push to get this regulation legitimized on its head. If they killed Pandora, record companies would lose over $200 in sales to me over the next year. Is it really worth that to them? I'm sure I'm not the only one who finds new music w
    • The corporate studios don't sign that many artists and (according to a Chicago Tribune article I read some years ago) a lot of the artists they sign are indebted to the label for many albums. So long before the listener gets any chance to hear the artist, the label has them under their thumb. The RIAA's legal antics against listeners (often bringing cases before researching evidence against them) is covered here on /.. I'm left to wonder why I should write anyone in support of making it easier to help these labels by making it more likely that their music will be played.

      I'm left to think that we should let them raise the rates as high as they think the market will bear. I'd rather work with artists who license their recordings to me so that I may non-commercially share them verbatim with others in any medium. I stopped listening to radio (online and over the air) because what I was hearing is only the "popular music that brings mainstream listeners" (in other words, as far as I can hear that's what they're playing now before any new fee schedule). This is not what I want to hear. Often the online stations I heard were merely retransmissions of what was being played over the air.

      Contrary to what FreePress.net is claiming in their emails, I don't believe this means the end of Internet radio. I think it means the end of RIAA tracks on Internet radio and it opens the way for unsigned artists and tracks from labels that don't screw the artist (like Magnatune).
      • You are not being asked to lobby in favour of just "the RIAA's clients." The "performance royalty" is collected for all songs played, regardless of whether the artist is signed with an RIAA-affiliated label or not. An Internet broadcaster's choice is to either pay royalties at the rates prescribed by the CRB to SoundExchange for each song played times the number of listeners, or to negotiate separate deals with the copyright holder of every song they play.

        The rates are so onerous that they threated to make
      • You really don't understand what SoundScan is. It's not RIAA music that's covered by SoundScan. It's *ALL* music. SoundScan is being set up to handle the royalties from a *compulsory* license for music. It doesn't matter if you don't want to be covered by SoundScan. It doesn't matter if you signed up to a major label deal. Your music, if it's covered by copyright in the US, will have its royalties handled by SoundScan.

        That's why I find all the complaining about the RIAA in these threads kinda silly:
    • Maybe not.

      If it becomes too expensive to play mainstream/signed artists, then perhaps we'll see a boatload of Internet radio stations spring up that exclusively play indie music.

      Hmmmm...I'd better go research streaming audio feeds -- I think I see a potential opportunity here =D

  • The retroactive part (Score:5, Interesting)

    by i_should_be_working (720372) on Thursday May 03 2007, @09:11AM (#18971935)
    This whole thing is disgusting.

    But I have a question about the retroactive part. It seems that not only will stations have to pay more in the future, but they have to pay more for the past year or so. How is that legal? Also, does anyone know how it would be enforced? If a station just shuts down and doesn't pay for the past year, then what?

    • Re:The retroactive part (Score:5, Funny)

      by Rob T Firefly (844560) on Thursday May 03 2007, @09:13AM (#18971959) Homepage Journal

      If a station just shuts down and doesn't pay for the past year, then what?
      That's when the RIAA hop into their souped-up DeLorean, zip back into the past, and make sure your parents never met.

    • Re: (Score:2, Informative)

      by laughingcoyote (762272)

      The last time I checked, ex post facto laws were prohibited. It's a bit like the IRS retroactively regulating that you really owed an extra $2000 on your taxes for the past five years, even though at the time you didn't.

    • AFAIK, the original royalty agreement expired at the start of 2006; they've been operating ever since in limbo since a new agreement hasn't gone to in effect. The new agreement then is retroactive because it includes the period of time where they didn't have an agreement because they were tied up in negotiations.
    • Wait what? What the fuck?

      Retro active law? Where the is your constitution now?

      No State shall enter into any Treaty, Alliance, or Confederation; grant Letters of Marque and Reprisal; coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts; pass any Bill of Attainder, ex post facto Law, or Law impairing the Obligation of Contracts, or grant any Title of Nobility.

      (emphasis mine)

      This is gut wrenching.

    • It seems that not only will stations have to pay more in the future, but they have to pay more for the past year or so. How is that legal?

      The old rates expired in 2005. Stations continued to pay those rates knowing they would owe whatever the difference was between the old rates and the new rates once they were announced. The trouble is, the old rates were based on the station's revenue, while the new ones are based on the number of listeners times the number of songs played. And they represent a HUGE incre

  • internet radio (Score:4, Informative)

    by elmCitySlim (957476) on Thursday May 03 2007, @09:12AM (#18971943) Homepage
    I work at a volunteer run radio station in CT. One of our DJs also runs an internet radio station with several volunteer DJs as well. He has to shut down due to this rate hike. He said it went from about 700 dollars a year to 15g a year.

  • Or... (Score:4, Funny)

    by bigtomrodney (993427) * on Thursday May 03 2007, @09:14AM (#18971977)
    ....61 days for those of you using the modern Gregorian Calender.

    • ....61 days for those of you using the modern Gregorian Calender.
      Yes, makes your Gregorians nice and glossy [reference.com].

      "You know what this'll cost you? Thirty days... hath September, April, June, and Montana. All the rest have cold weather, except in the summer, which isn't often!"

  • Voice your unhappiness! (Score:4, Informative)

    by u-bend (1095729) on Thursday May 03 2007, @09:14AM (#18971981) Homepage Journal
    Go here [capwiz.com] to protest this bullcrap.

    • Re:Voice your unhappiness! (Score:4, Interesting)

      by Otter (3800) on Thursday May 03 2007, @09:41AM (#18972393) Journal
      I'm constantly posting here to explain why copyrights and patents are vital for continued innovation and creativity, and why you "Music and movies suck so that's why I have to steal them!" people are idiots. And I wrote to my representatives the minute Pandora sent me the above link. All the music I've purchased over the last few years is stuff I've learned about from Pandora, Live365 and Garageband, and keeping it legal is what allows me to talk down to you whiny thieves.

      If you don't take action on this, you've forfeited your right to ever post moronic "Teh RIAA is suing teh singal mothers!" comments again.

      • If you don't take action on this, you've forfeited your right to ever post moronic "Teh RIAA is suing teh singal mothers!" comments again.

        Hey, I'd love to, because there are some great US-based internet radio stations I love to listen to. Could you remind me who my Congressman/woman is here in London, England? Oh, wait, I'd come under foreign affairs, wouldn't I? Secretary Rice seems terribly busy right now, I'll just have to keep posting those moronic "Teh RIAA is suing teh singal mothers!" comments anyway.

      • I purchase all of my music. Every song on my computer, iPod, every burned CD, is a copy of music that I own. I do listen to internet radio stations and I enjoy them. I do not, however, enjoy much pop music. No rapper of the day, none of today's best country or whatever. I'm not a big fan of the advertisement based radio either. And I'm rather aggressive with people who just download everything. It pisses me off.

        I do support copyright and patent for innovation. Now, I've tried to educate myself about

      • I'm constantly posting here to explain why copyrights and patents are vital for continued innovation and creativity

        I agree with this, but only to a point. I don't believe that infinite copyright is vital for continued innovation, and I don't think that fair use should go out the window just because violating copyright got a little easier. I don't mind copyright one bit, but I want to be able to copy my DVDs to a central file server so that I not only have a backup, but I can watch them from anywhere in the world without carrying the DVD with me. I also don't think that copyright should enable companies to restrict c

      • Re:Voice your unhappiness! (Score:5, Insightful)

        by acherusia (995492) on Thursday May 03 2007, @10:24AM (#18973131)
        Damnit. I'm forfeiting mod points to respond, but you hit a major pet peeve of mine there.

        You do not get to define the terms of a debate. You do not get to say "If you do not take a particular action that I like you to take, you have lost the ability to debate this without being a flaming hypocrite." You can also lay off the self-aggrandizing holier-than-thou soapboxing, but I don't really care about that.

          I'm probably not going to contact my representative on this issue. I may, because I think this is as much bullshit as everyone else, but frankly I have so much shit going on in my life right now that I just have absolutely no desire to do so. On the other hand, I decided years ago that I wouldn't give the RIAA or the MPAA a single cent, nor would I give them mindshare by pirating. I'm not going to say I've never broken that, but only twice. (It helps that I prefer books and videogames to music and movies.) And you're saying that if I don't take a single action you think I should take I lose the right to bitch about the RIAA? Um. No.

        Personally, I'm also not convinced that patents and copywrites are entirely vital to creativity, but that's another debate entirely.

        • You do not get to define the terms of a debate. You do not get to say "If you do not take a particular action that I like you to take, you have lost the ability to debate this without being a flaming hypocrite."


          I agree. It's like people who say "if you don't vote you don't get to complain." What a load of crap. I pay taxes, so I'll comment on the actions of my elected officials regardless of whether I voted or not.
      • I am a lot like you - I would not listen to most of the mainstream big label music if it was free (oh wait broadcast radio is, and I refuse to listen to it), yet I buy more CD's today than I did 10 years ago. Why? di.fm - chillout channel plays great music, 90% of it from small independent European labels. If they go off the air, I don't know how I'll find new music to listen to (well that's not entirely true, I can rely on the artist sand labels I have come to love to provide me with new music).
  • Can't Internet radio stations just simply refuse to play RIAA music then? This would be great. We'd get stations full of independent artists and labels. I want to see billboard music disappear with what they're doing. They're trying to cripple and control the Internet instead of working with it. They need to learn that this will only lead to their downfall.

    • Can't Internet radio stations just simply refuse to play RIAA music then?

      Through SoundExchange, they'll still collect [dailykos.com] from the Internet radio stations anyway.

    • Unfortunately due to the wonder of the compulsory license, that is not an option unless you individually contact every copyright holder and make a deal. This is because the RIAA (or SoundExchange to be more specific) has been given the (questionablly) legal right to collect royalties on any song played on internet radio if the broadcaster does not already have a deal with the copyright holder. Artists then have to contact SoundExchange and pay them an "administrative" fee to collect the royalties convenie

      • An alternate solution? (Score:4, Insightful)

        by Rob T Firefly (844560) on Thursday May 03 2007, @10:03AM (#18972795) Homepage Journal
        Maybe I'm nutty, but would it be possible for an Internet broadcaster to switch to some sort of submission-based format? In that way, artists can submit their own work to the station. Through this process they'd not only hook their submissions to the info on where to send the royalty check (bypassing the RIAA/Soundexchange scam) but also agree to some actually sane royalty rate, terms-of-service style. On an Internet where MySpace, MP3.com, and the like are full of people who are already putting tracks out there for free, where countless bands with their own actual websites are paying hosting fees out of their pockets to put their free downloads out there, and where most of these people would love the chance to get themselves heard on popular Internet radio stations, it seems to me a broadcaster could build up a respectable playlist in this manner.
      • I call bullshit. That is unenforceable. If, for example, I had a band, and we wanted to stream OUR music and our music only...how can RIAA possibly lay claim to any of that? It's not like I'd be 'broadcasting' in the sense of radio on the public airwaves.

      • Re: (Score:3, Interesting)

        by Gonarat (177568) *

        This may be a dumb question, but could independent "label" sites such as CD Baby or DMusic (home of boycott-riaa.com, not to be confused with Emusic) set up an easy way to allow internet radio stations to play music from their artists at a better price? It would be a pain in the ass to have to contact every band or singer that you want to play on your internet radio station, but being able to play any group from say CD Baby and pay them directly would be doable. The site could even create weekly or monthl

  • Here's hoping! (Score:4, Interesting)

    by Jugalator (259273) on Thursday May 03 2007, @09:29AM (#18972191) Journal
    I really, really hope the Internet Radio Equality Act [arstechnica.com] will go through ASAP for this, or it'll likely become a devastating blow to most serious Internet radio stations out there. :-/
  • Congress needs to smack the shit out of the Copyright Board for this stunt. As in abolish them entirely and make the payment returns retroactive. And to revoke laws that help entertainment monopolies like the RIAA. That'd be sweet justice AND help America by revoking needless laws AND give consumers more choice. The only loser would be the RIAA.
    • Given past performance of the US Congress when intelligence in legislative action is required involving the entertainment industry, we can expect Congress to not only NOT intervene, if they do it will likely NOT be in the consumers' favor.
      • Given past performance of the US Congress when intelligence in legislative action is required involving the entertainment industry, we can expect Congress to not only NOT intervene, if they do it will likely NOT be in the consumers' favor.

        At some point this knee-jerk "they're all crooks" stuff becomes self-defeating. The worst of the crooks push this notion hard because it essentially lets them off the hook for what they've done, and it simultaneously casts doubt on any reformer who is not a crook, or is a
    • True. But in a capitalistic system that ran amock, the big bucks get to make the laws and buy justice.

  • Everything old is new again... (Score:3, Insightful)

    by Anonymous Coward on Thursday May 03 2007, @09:42AM (#18972407)
    Local DJ-driven radio is all but dead at this point anyway. The idea of using radio to actually engage listeners, as opposed to playing a rather fixed set list of "hits", is something most stations have given up on. Up here, the Detroit NPR affiliate, WDET, went so far as to eliminate most of its music programming (including the phenomenal Alternate Take, hosted by Liz Copeland, and some legendary jazz shows that have been staples for that community) in favor of becoming a clone of another NPR affiliate that we already receive in the same area.

    Radio and the larger music labels have given up their role as taste-makers in lieu of pandering to more conservative audience taste. A local DJ can afford to challenge you. A large multi-station enterprise has little choice but to play it safe. Even the satellite radio stations have woefully "safe" playlists, for all the chatter about endless choice.

    I dare say most people reading slashdot gave up on the idea of finding new music on the radio a while ago - and the rest of the public is only half a step behind. The unfortunate consequence will be the larger record labels and the multi-station radio networks are going to fight technology tooth and nail for a fight they already gave up on twenty years ago.

    Payola used to be a scandal. Now it's merely a business model.
    • Two words: college radio. They can play anything they want, and they do. That's about all I listen to anymore, including lots of online streaming college radio stations, and they've turned me onto lots, and lots, and lots of new music, precisely because they're not playing the same 45 songs all the mainstream radiostations are playing.

      Cat Power, Arcade Fire, Electralane, Goldfrapp, Gotan Project, Jane Jensen, Leona Naess, Elliott Smith, Robert Miles, Tal Klein, DJ Chebi Sabah, 18th Street Lounge, Sea

  • Pandora [techdirt.com] is being forced to block non-US listeners.

    From the article:

    Pandora.com, a popular streaming music recommendation service (which is already facing some challenges due to the new webcaster rates) is being forced to block all non-US users of its service. This is because the recording industry wants Pandora to sign separate licensing deals in every country where it has listeners -- a nearly impossible task.

    You have to wonder how much longer the RIAA will get away with its ignorance and greed.

    • I seem to remember pandora requires a zip code to verify you're American. If you live abroad just put in 000000 and you're set! At least you could, I don't know if they still accept it, but they did when I signed up.
    • I assume you mean 'contact'.

      The only artists interested in overthrowing the RIAA are the ones that don't benefit from their tactics. If you expect mainstream artists to overthrow the RIAA, you're going to have to PROVE to them that the RIAA is bad for them. Nobody has managed yet. Common sense and numbers won't do jack. They need proof.

      Having said that, Apple's recent anti-DRM speeches have definitely been a step in the right direction. As more people realize how much more they can do with their songs

    • If Internet radio is turned into the playground for rich corporations, they'll be locked into the RIAA for the foreseeable future. Who benefits from that?

      Let's see:

      Shareholders of RIAA & big media companies (Clearchannel, etc).
      Boardmembers and execs at RIAA & big media companies.
      Politicians and political parties who take donations from the RIAA and RIAA & big media companies.

      What do these have in commom? They are already the ones vested in positions of power. They have no interest in reducin

    • Re: (Score:3, Informative)

      by Dr. Eggman (932300)
      Coln. Mustard in the kitchen with the revolver.

      In other news, Congress continues to sluggishly review sluggishly review [loc.gov] H.R.2060: Internet Radio Equality Act. If you write a senator (or actually, house member) perhaps one should mention support for this.

      While your writing, put in a bad word about this one [loc.gov]. Colleges don't need to be wasting time and money trying to stop software piracy on campuse. Oh, and maybe this one [loc.gov], too.
      • butt technology.. i made myself laugh on that typo.. what the hell is butt technology?!

        Those of us in at the Tp Research Institute for Environmental Responsibility think making sure that a single square of TP is sufficient for every bathroom visit is nothing to laugh about.

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