Copyright Office Publishes Final Webcasting Rates

Ghaleon writes: "The Copyright Office just released the final rates for webcasting. Looks like the rates are lower than the CARP recomendations, though I'm no webcaster so I'm not sure if these rates are good or not ..." nbrimhall points to a bit more at soma fm as well. Update: 06/20 21:54 GMT by M : See our last story for background information. The final rates are nothing to cheer about: most webcasters will not be able to afford them. Update: 06/21 03:13 GMT by T : An anonymous reader points out the continuing coverage at kurthanson.com, including reactions from Reps. Boucher and Inslee.

Bye-bye

[sulli]

Bye-bye Groove Salad [somafm.com], it's been nice knowing you!

This is already hitting us...

[ZorinLynx]

Tag's Trance Trip [tagstrance.com], one of my favorite internet radio stations of all time, just went down.

We'll probably see a lot more stations go down. Underground internet radio and offshore stations will be all that's left.

AP article

[Anonymous Coward]

It ain't karma whoring if you're AC:
(comment: the author thinks this is a victory for webcasters - he must listen to Clear Channel and think it's excellent)

Rates set for royalties on Internet music broadcasts

DAVID HO, Associated Press Writer Thursday, June 20, 2002

(06-20) 14:42 PDT WASHINGTON (AP) --

In a victory for Internet music broadcasters, the government on Thursday decided that songs delivered online will be charged royalty fees at a rate that is half of what was originally proposed by an arbitration panel.

Webcasters will be charged at a rate that amounts to 70 cents per song for each one thousand listeners, the U.S. Copyright Office announced on its Web site.

Librarian of Congress James H. Billington, who oversees the Copyright Office, found that the original proposal that set a higher rate for Internet-only programs than the radio rate "was arbitrary and not supported by the record of evidence," said spokeswoman Jill Brett.

In May, Billington rejected a government panel's rate proposal -- up to $1.40 per song heard by one thousand listeners. That was double the rate for broadcasts sent out simultaneously on radio and the Internet.

"It's good news for a number of Internet webcasters who will now likely be able to stay on the air," P.J. McNealy, research director with the analyst firm, GartnerG2.

Opponents to Thursday's ruling can appeal to the U.S. Court of Appeals for the District of Columbia Circuit within 30 days. The court could modify or set aside the decision if it finds the ruling was highly unreasonable.

Internet radio, either simulcasts of traditional over-the-air radio or Internet-only stations streamed through the Internet to computers, is becoming more popular as people get high-speed connections at home.

Webcasters said the rates initially proposed were too high and would cost larger Internet radio broadcasters hundreds of thousands of dollars annually, more than they get from advertising or listener contributions. Many webcasters said the fees, which would be retroactive to 1998, would force them to shut down.

The record industry had sought higher royalties, saying more was needed to compensate artists and music labels for using their songs.

Webcasters, as well as over-the-air radio stations, already pay composers and music publishers royalties for the music they play, based typically on a percentage of their revenues.

But traditional radio broadcasters have been exempt from paying the royalties for each song played -- the standard that is now being applied to webcasters. Broadcasters successfully argued before lawmakers that they already were promoting the music.

After the recording industry failed to impose those new royalties on traditional broadcasters, the industry turned to webcasters -- and a 1998 law granted the industry its wish.

bankrupting on-air as well as webcasters

[pjones]

this ruling includes a retroactive charge going back to October 28, 1998 that is due in full by October 20, 2002. so if you were webcasting or simulcasting since 1998 (or before) you OWE for 4 years IMMEDIATELY!
since the rates are relatively unchanged (completely unchanged for non-commercial), you are out of business because you racked up a debt unknowingly for those 4 years.
if you are a non-commercial station, college or community, you may have to shutdown both castings and give up.

not ignorance...

[OpenMind(tm)]

..but conscience action. As seen in this snippet, they know they will be putting small operators out of business to make sure the RIAA gets what it wants:

Webcasters and broadcasters asked that the Librarian reject the CARP's approach and provide them with an option to pay a rate based on a percentage of their revenues, rather than a per-performance rate.

...

Finally, the CARP noted that because many webcasters are currently generating very little revenue, a percentage of revenue rate would require copyright owners to allow extensive use of their property with little or no compensation.

the only options

[GoatPigSheep]

1. stop playing riaa music. This will help independant artists (such as myself) alot, but will cause people to not hear the music they want to hear at first.

2. Don't host in the US, use overseas servers. The riaa will probably try and make their laws apply to other contries (stupid), but I doubt it will work on all countries.

CNN calls it a "victory"

[ryants]

Over at CNN the headline is:

Netcasters win ruling

U.S. rules songs delivered online will be charged royalty fees at half that originally proposed.

Here's the link. [cnn.com]

Some victory... instead of cutting off both arms, you get to keep one. :(

This is bullshit!

[Newer Guy]

I've worked in radio and the music industry for over thirty years. Today I'm embarrassed to admit it. This is yet another exapmle of the big fish swallowing up the little ones. The broadcast industry DOES NOT HAVE to pay these rates for over the air treansmission. All they pay is ASCAP and BMI fees, which are a percentage of their gross billing. Noncommercials pay a flat rate of about $1500-$2000 per year. Also, these fees go to the composers ....NOT the RIAA as the new fees will. This fee does not benefit the musician one single bit...all it does is fatten the coffers if the 'big five' record companies. The irony is that this fee is likely to result in less music purchased, and less music broken into the marketplace...again hurting the smaller, independent companies and artists NOT the RIAA and it's ilk! Finally, here's the total arrogance of the RIAA for you: Comment of Cary Sherman, President, Recording Industry Association of America (RIAA) On Librarian's Decision On Internet Radio Royalty Rates June 20, 2002 "The import of this decision is that artists and record labels will subsidize the webcasting businesses of multi-billion dollar companies like Yahoo, AOL, RealNetworks and Viacom. The rate, which cannot be squared with the decision of the arbitration panel, simply does not reflect the fair market value of the music as promised by the law. This decision will certainly reinforce the steadfast opposition of copyright owners to compulsory licensing." These assholes STILL aren't happy!!! They've trashed Internet broadcasting and they STILL want more! I don't know about you, but I've purchased my LAST CD from the 'big five' record companies! I suggest that you do the same...

Re:bankrupting on-air as well as webcasters

[pjones]

yes CPB stations cut a separate deal possibly creating a CPB monopoly. but some of the most interesting on-air community stations in say boulder, berkeley, and in chapel hill including classical stations and student stations are not CPB stations and never will be.

Alternative Sources of Music

[AZPhysics]

There are other ways of getting music. Unfortunately, they are not as convenient as internet radio. First, is direct exchange. My brother let me borrow some CD's. I made some "backup" copies for him on my computer. Today, I mailed him back his CD's along with ~5 CDs I burned of stuff I had. I hope he keeps my "off-site backups" safe. ;-) I've also made back-up copies for freinds and even my mother-in-law.

A second source of music is your local library. Virtually every town of over 3000 people in the US has a library with a collection of CDs. Usually, there is a large selection of classical CDs, which are hard to find on the internet. Your taxes have purchased them, so make yourself some backup copies.

A third source of music is your local free performances. Your local university and high school will often have free recitals. Also, most major metropolitan areas have symphonies. Go ahead and check them out. Remember, if you have to pay for the performance, probably none of the money goes to the RIAA.

A fourth source is free internet archives of various sorts. This is most common classical and folk as opposed to pop. One site I'd recommend for folk is Roger McGuinn's Folk Den at http://www.ibiblio.org/jimmy/folkden/ . McGuinn posts a new song, freely downloadable, every month since November of 95. Also, he testified on behalf of file sharing during the Senate hearings.

While not a free source of income, a good thing to do is to contact your favorite independet artists. Tell them about the problems with webcasting, and the chances they have to be widely heard. Tell them to band together. Send them the adresses of your favorite webcasters. Get the word out that they can make deals with these stations. I promise to email some of my favorite indie artists, and I would encourage you to do the same.

Re:Civil disobedience

[startled]

Actually, it's time to stop listening to corporate music.

Civil disobedience? I'm supposed to think it's worth risking prison so I can listen to major label music?

Maybe some of you are out in the middle of nowhere, but here near San Francisco I can find all sorts of shows, unsigned artists selling their CDs for what it cost to make them, and DJs spinning tunes off indie labels that would be thrilled to have people stream their stuff over the net.

I've stopped buying CDs from any RIAA member; hell, I basically don't buy CDs. On the one hand you clamor against the RIAA, but on the other hand you can't wean yourself from their product? Why are you encouraging artists to limit access to their work by signing with these people?

Civil disobedience? Hmm, rather than go to jail, how about I listen to Free Music. Check out somesongs.com and songfight.com for starters.

An internet broadcaster's opinion

[detroitindustrial]

I run Detroit Industrial Underground [detroitindustrial.org]. My station has a 20 simultaneous listener capacity, and I've been broacasting for 3.5 years. To give you an idea of the small scale of most internet broacasts, DIU is currently ranked 222 out of around 2800 stations on the Shoutcast directory for total time spend listening (TTSL).

Some thoughts, based on what I've read here:

Terrestrial radio stations with webcasts are as unhappy with these rates as internet broadcasters are, and they'll be lobbying against this as well.

Some people have said that these rates won't apply to stations which only play non-RIAA material. While common sense would suggest that, it has not been proven yet, and common sense doesn't seem to apply to anything involving the RIAA and U.S. Congress.

Ephemeral recordings are "temporary" recordings made solely for broadcast purposes. In the case of internet radio, they're referring to MP3s. In practice, its an excuse to add another 8.8% fee on top of the per listener per song $0.0007.

Moving outside the U.S. won't save internet radio. U.S. based Broadcasters can be tracked through ISP's and billing relationships with hosting companies. Also, other countries have licensing bodies which are just as rapacious as the RIAA. In Canada, SOCAN is pushing Tariff 22, which imposes a $0.25 per unique listener per month fee. This adds up to more than the RIAA + BMI/ASCAP/SESAC fees, and forces listener tracking/subscriptions for auditing purposes. See the Stop Tariff 22 [rantradio.com] website for the details.

The battle isn't lost yet. On the Shoutcast list, we're working on our response to this. In the meantine, check out Save Internet Radio [saveinternetradio.org] and the Radio and Internet Newsletter [kurthanson.com]. Finally, write your reps in Congress, and include your snail mail addresss so they know you're a constituent.

Re:the only options

[BrookHarty]

Where can I get good non-riaa streaming techno? I listen to http://www.digitallyimported.com/ [digitallyimported.com]
every day at work, and I love it. I even started saving streams, worried that it would shut down. I would even pay a subscription if it would keep them in business. Thou at 7 cents a song, about a buck an hour is quite steep, more than my cable bill a month.